accounted for in accordance with FAS Statement No. 141R which was codified under the “Business Combinations topic of the FASB ASC. Describe how the purchase price was allocated to assets acquired and liabilities assumed based on the estimated fair value at the date of acquisition. The allocation of purchase price included identifiable intangible assets and goodwill which was valued at the date of acquisition by an independent valuation firm, [Insert Valuation Firm Name Here] using generally accepted
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inflation, income tax and interest rate. Firstly, Using the Present Value Function we can calculate the compound interest of the lump sum ($334.1m) in relation to the total value of the annuity payout ($500m). Based on the PV Formula: PV = FV/(1+i)n 334.1 = 500/(1+i)29 500/334.1 = (1+i)29 29√1.49 = 1+i 1.0139 – 1 = i Interest Rate = 1.4% To meet the $500m Future Value of the annuity payout, Lucky Ducky would have to gain 1.4% compound interest
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social security payments will increase with inflation, but the interest on his investment portfolio will not. Advice Mr. Road‘s social security would adjust for inflation. But his earning from accumulated saving is in nominal terms. Since some values are in nominal terms and some are in real terms, it is advisable to perform all calculations in real terms
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| Mergers & Acquisitions | Acquisition Case Study: Amazon’s acquisition of Zappos, November 2009 | | Stephen Greening | 26/04/2014 | WORD COUNT: 2489 Contents Executive Summary 3 Introduction 4 Amazon Overview 4 Amazon’s Previous Acquisitions 5 Zappos Overview 6 Acquisition of Zappos 9 Strategy 11 Why Amazon wanted to acquire Zappos 11 Regulation 14 Valuation 15 Comparable Company Analysis (Comps)
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Assignment 3 Solve the following problems showing your work: Q1. If you have a credit card with 14.4% APR a. What is your monthly interest rate and what is your annual effective interest rate? ia (monthly) = 14.4%/12 = 1.2% ia (annual effective interest rate) = (1 + .144/12)12 – 1= 15.39% b. If you have an outstanding balance of $1,800 on that card what would be the balance if you skipped 4 months payments (ignore credit card fees and penalties) 1800(1.012)4= $1887
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for the Craddock Cup to generate enough money annually for the Craddock Youth Soccer League to reach their field-acquisition goal. The first step would be to revise the overhead-expense allocations. Because Rivaldo is employed by CYSL full-time with a fixed salary, it would be benefitial for the tournament if none of it is allocated to the Craddock Cup. This is also true for the Rent and utilities. The league will be renting 10 soccer fields from the city for 40 weeks regardless of whether
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Question 1 | | 0.25 / 0.25 points | APV = NPV (without expansion option) + Value of the expansion option. | | 1) True | | | 2) False | Question 2 | | 0.25 / 0.25 points | The owner of a professional sports franchise, looking to get a new stadium, would benefit from a put option if the deal falls through. | | 1) True | | | 2) False | Question 3 | | 0.25 / 0.25 points | If you write a put option, you acquire the right to buy stock at a fixed strike price. | | 1) True |
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risk (systematic risk) -results from factors that affect all stocks. -Diversification investing in more than one security to reduce risk -Holding period returns the return an investor would receive for holding a security for a designated period of time. Beta the relationship between an investment's returns and the market's returns. Measurement of nondiversifiable risk. -Portfolio beta the relationship between a portfolio's returns and the market returns. It is a measure of the portfolio's nondiversifiable
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Exercício 1 • You are offered an asset costing $600 that has cash fl ows of $100 at the end of each of the next 10 years. • a. If the appropriate discount rate for the asset is 8 percent, should you purchase it? • b. What is the IRR of the asset? Exercício 2 • You just took a $10,000, five-year loan. • Payments at the end of each year are flat (equal in every year) at an interest rate of 15 percent. Calculate the appropriate loan table, showing the breakdown in each year between principal
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merger between HP and Compaq to occur because they might have been able to collect higher fees. Therefore, they immediately squashed any doubts and gave advice for the merger to happen, even if carrying out such an acquisition would have destroyed value for HP shareholders. 2. For Patricia Dunn, the past successful consolidation mergers are vulnerable but overcome key challenges in the first two years. She believes that the merger between HP and Compaq will ultimately help her company. The
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