IOWA FIN341 2020 JUNE All Weeks Case Studies Latest

FIN341 Corporate Financial Management

Week 1 Case Study

CASH FLOWS AT EAST COAST YACHTS

Because of the dramatic growth at East Coast Yachts, Larissa decided that the company should be reorganized as a corporation. Time has passed and, today, the company is publicly traded under the ticker symbol “ECY”.

Dan Ervin was recently hired by East Coast Yachts to assist the company with its short-term financial planning and also to evaluate the company’s financial performance. Dan graduated from college five years ago with a finance degree, and he has been employed in the treasury department of a Fortune 500 company since then.

EAST COAST YACHTS

2017 Income Statement

Sales      $611,582,000

Cost of goods sold           431,006,000

Selling, general, and administrative         73,085,700

Depreciation         19,958,400

EBIT       $  87,531,900

Interest expense                 11,000,900

EBT         $  76,531,000

Taxes        30,612,400

Net income        $  45,918,600

Dividends            17,374,500

Retained earnings           $  28,544,100

The company’s past growth has been somewhat hectic, in part due to poor planning. In anticipation of future growth, Larissa has asked Dan to analyze the company’s cash flows. The company’s financial statements are prepared by an outside auditor. Nearby you will find the most recent income statement and the balance sheets.

Larissa has also provided the following information. During the year, the company raised $40 million in new long-term debt and retired $22.6 million in long-term debt. The company also sold $24.2 million in new stock and repurchased $35.64 million. The company purchased $59.5 million in fixed assets, and sold $6,718,200 in fixed assets.

 

 

East Coast Yachts Balance Sheet

Larissa has asked Dan to prepare the statement of cash flows. She has also asked you to answer the following questions:

How would you describe East Coast Yachts’ cash flows?

Which cash flows statement more accurately describes the cash flows at the company?

In light of your previous answers, comment on Larissa’s expansion plans.

In addition to your responses to the 3 questions, be sure to also prepare and submit the statement of cash flows.

 

FIN341 Corporate Financial Management

Week 2 Case Study

Instructions

The Week 2 Case Study Assignment is the first part of a series of analytical tasks, spanning several weeks. Your task involves an analysis of general economic conditions or systematic risk, i.e., the risk that affects all industries and companies, in the U.S. macroeconomy. Your goal is to determine in percentage terms an optimal allocation of $1,000,000 among the following three asset classes: U.S. equities, U.S. Treasury bonds, and cash.

The goal is to maximize your expected return over the next 12 months.

Write a 1- to 2-page paper providing your analysis of the asset classes' prospects and your justification of your allocation of monies among them.

In Week 2, submit your analysis of U.S. equities.

Note: In the upcoming weeks, you will submit your analysis of U.S. Treasury bonds and cash.

 

 

 

 

FIN341 Corporate Financial Management

Week 3 Case Study

The Week 3 Case Study Assignment is the second part of a series of analytical tasks, spanning several weeks. Your task involves an analysis of general economic conditions or systematic risk, i.e., the risk that affects all industries and companies, in the U.S. macroeconomy. Your goal is to determine in percentage terms an optimal allocation of $1,000,000 among the following three asset classes: U.S. equities, U.S. Treasury bonds, and cash.

The goal is to maximize your expected return over the next 12 months.

Write a 1- to 2-page paper providing your analysis of the asset classes' prospects and your justification of your allocation of monies among them.

In Week 3, submit your analysis of U.S. Treasury bonds. Keep in mind that the purpose of your analysis is to determine how much money to allocate to each class.

 

FIN341 Corporate Financial Management

Week 4 Case Study

Instructions

The Week 4 Case Study Assignment is the third part of a series of analytical tasks, spanning several weeks. Your task involves an analysis of general economic conditions or systematic risk, i.e., the risk that affects all industries and companies, in the U.S. macroeconomy. Your goal is to determine in percentage terms an optimal allocation of $1,000,000 among the following three asset classes: U.S. equities, U.S. Treasury bonds, and cash.

The goal is to maximize your expected return over the next 12 months.

Write a 1- to 2-page paper providing your analysis of the asset classes' prospects and your justification of your allocation of monies among them.

In Week 4, submit your analysis of the decision to invest your assets in cash. Keep in mind that the purpose of your analysis is to determine how much money to allocate to each class.

 

FIN341 Corporate Financial Management

Week 5 Case Study

Instructions

The Week 5 Case Study Assignment is the fourth of a series of analytical tasks, spanning several weeks. Your task involves an analysis of general economic conditions or systematic risk, i.e., the risk that affects all industries and companies, in the U.S. macroeconomy. Your goal is to determine in percentage terms an optimal allocation of $1,000,000 among the following three asset classes: U.S. equities, U.S. Treasury bonds, and cash.

The goal is to maximize your expected return over the next 12 months.

In Week 5, submit a combined analysis of your allocation among the three asset classes. Combine your analysis from the previous three weeks into one final paper and include a conclusion summarizing your findings over the course of the 3-week project.

 

FIN341 Corporate Financial Management

Week 6 Case Study

Instructions

The Week 6 Case Study Assignment asks that you consider the agency relationship between a corporate financial manager and the shareholders of the corporation.

As a corporate financial manager, you have the opportunity to manage the company's cash on behalf of its owners (shareholders).

Consider the case of Apple, Inc, and the company's cash stockpile. The company's financial managers bear the responsibility of managing the cash reserves on behalf of Apple's shareholders.

Write a 1-2 page paper, using the following guidelines:

In the first half of the paper, research and briefly describe the concept of agency.

In the second half of your paper, imagine yourself in the role of Apple's financial management team. Describe what types of measures you would take to ensure that any decisions made with regards to the company's cash faithfully represent the wishes of the shareholders.

 

FIN341 Corporate Financial Management

Week 7 Case Study

Instructions

The Week 7 Case Study Assignment is an individual assignment that requires you to analyze a select group of alternative industries to determine which is most likely to perform best over the next 12 months. Factors to consider when comparing the industry groups include how the current and prospective economic conditions over the next year will affect them and the current and prospective domestic and global supply and demand conditions in their markets.

Review briefly the list of industries below and pick two major groups to analyze. Submit your choice of industries as your Week 7 Case Study Assignment.

Note: In week 8, you will submit an analysis of the two groups.

Basic Materials:

Aluminum

Major Integrated Oil &Gas

Nonmetallic Mineral Mining

Consumer Goods:

Appliances

Confectioners

Office Supplies

Financial:

REIT-Healthcare Facilities

REIT-Hotel/Motel

REIT-Industrial

Healthcare:

Drugs-Generic

Home Health Care

Hospitals

Industrial Goods:

Manufactured Housing

Pollution & Treatment Controls

Services:

Advertising Agencies

Air Delivery & Freight Services

Drug Stores

Electronic Stores

Home Improvement Stores

Jewelry Stores

Technology:

Computer Based Systems

Long Distance Carriers

Personal Computers

Utilities:

Water Utilities

 

FIN341 Corporate Financial Management

Week 8 Case Study

Instructions

The Week 8 Case Study Assignment requires you to submit your final analysis of the two industry groups selected in Week 7, to determine which is most likely to perform best over the next 12 months. Factors to consider when comparing the industry groups include how the current and prospective economic conditions over the next year will affect them and the current and prospective domestic and global supply and demand conditions in their markets.

Create a 2-page essay that includes your analysis. Submit your work as your Week 8 Case Study Assignment.

Basic Materials:

Aluminum

Major Integrated Oil &Gas

Nonmetallic Mineral Mining

Consumer Goods:

Appliances

Confectioners

Office Supplies

Financial:

REIT-Healthcare Facilities

REIT-Hotel/Motel

REIT-Industrial

Healthcare:

Drugs-Generic

Home Health Care

Hospitals

Industrial Goods:

Manufactured Housing

Pollution & Treatment Controls

Services:

Advertising Agencies

Air Delivery & Freight Services

Drug Stores

Electronic Stores

Home Improvement Stores

Jewelry Stores

Technology:

Computer Based Systems

Long Distance Carriers

Personal Computers

Utilities:

Water Utilities