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The market price of K-T-Lew Corporation's common stock is $60 per share, and each share gives its owner one subscription right. Four rights are required to purchase an additional share of common stock at the subscription price of $54 per share. If the common stock is currently selling rights-on, what is the theoretical value of a right? Answer to the nearest cent.
| 1.2 |
stock_price = 60.0
rights_sub_price_per_share = 54.0
rights_per_share = 4
value = (stock_price - rights_sub_price_per_share) / (rights_per_share + 1)
round(value, 2)
|
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| null |
The following information pertains to Baxter Co: Inventory at beginning of year $200000 Inventory at year end $300000 Cost of goods sold during the year $500000 What was Baxter's inventory turnover for the year? Answer to one decimal place.
| 2 |
beginning_inventory = 200000
ending_inventory = 300000
cost_of_goods_sold = 500000
inventory_turnover = cost_of_goods_sold / ((beginning_inventory + ending_inventory) / 2)
round(inventory_turnover, 1)
|
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| null |
An equipment costs $17,000 with a useful life of five years and estimated residual value of $2,000. The equipment is to be depreciated using the double declining balance method. What is the net book value of the equipment at the beginning of the third year? Answer to the closest dollar.
| 6,120 |
cost = 17000
life_years = 5
residual_value = 2000
remaining_value = 15000
straight_line_depreciation = 1.0 / life_years
depreciation_per_year = (straight_line_depreciation * cost)
ddb_year_1 = (2 * straight_line_depreciation) * cost
book_value_year_1 = cost - ddb_year_1
ddb_year_2 = (2 * straight_line_depreciation) * book_value_year_1
value_end_of_second = book_value_year_1 - ddb_year_2
round(value_end_of_second, 2)
|
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| null |
A 180-day money market instrument is quoted at an add-on rate of 4.76% for a 360-day year. What is the bond equivalent yield of the instrument? Answer as a percentage with two decimal places.
| 4.83 |
add_on_rate = 0.0476
instrument_days = 180.0
days_per_year = 360.0
par_value = 100.0 + (100 * (instrument_days / days_per_year) * add_on_rate)
add_on_rate = (days_per_year / instrument_days) * ((par_value - 100) / 100)
bond_equivalent = (365 / days_per_year) * add_on_rate
round(100.0 * bond_equivalent, 2)
|
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| null |
A nongovernmental, not-for-profit organization held the following investments:
Investment Cost, Fair value (beginning of year), Fair value (end of year)
Stock A (100 shares), $50 per share, $45, $51
Stock B (200 shares), $40 per share, $41, $49
What amount of stock investments should be reported in the year-end statement of financial position? Answer to the nearest dollar.
| 14,900 |
stock_a_cost = 100 * 50
stock_b_cost = 200 * 40
stock_a_end_value = 100 * 51
stock_b_end_value = 200 * 49
investment_value = stock_a_end_value + stock_b_end_value
round(investment_value)
|
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| null |
Hall Co. purchased a machine on January 1 at a cost of $140000. The machine had an estimated useful life of eight years and a salvage value of $60000. Hall chose to depreciate the machine using the double- declining balance method. What was the carrying amount of the machine in Hall's balance sheet at the end of its second year of operations? Answer to the closest dollar.
| 78,750 |
cost = 140000
life_years = 8
residual_value = 60000
remaining_value = 80000
straight_line_depreciation = 1.0 / life_years
ddb_depreciation = 2 * straight_line_depreciation
ddb_year_1 = ddb_depreciation * cost
book_value_year_1 = cost - ddb_year_1
ddb_year_2 = book_value_year_1 * ddb_depreciation
book_value_year_2 = book_value_year_1 - ddb_year_2
round(book_value_year_2, 2)
|
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| null |
An equity analyst is using the market model to analyze the returns to a stock. During the recent year, the market rose by 5% and the stock rose by 8%. The beta for the stock is 0.66 and alpha is 0.02. What is the company-specific return to the stock during the recent year? Answer as a percentage with a single decimal place.
| 2.7 |
market_return = 0.05
stock_return = 0.08
beta = 0.66
alpha = 0.02
company_specific_return = stock_return - (market_return * beta) - alpha
round(company_specific_return * 100, 1)
|
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| null |
Corbet Co. purchased a copyright near the beginning of the current year from an author for $20000. The legal life of the copyright is equivalent to the life of the author plus 50 years. Corbet expects to sell the book for five years. What amount should Corbet report as amortization expense related to the copyright at the end of the current year? Answer to the closest dollar.
| 4,000 |
purchase_cost = 20000
life_of_author = 50
life_of_copyright = life_of_author + 50
amortization_period = 5
amortization_expense = purchase_cost / amortization_period
round(amortization_expense)
|
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| null |
A hedge fund with $120 million of initial investment and 2-20 fee structure earned 35% return at year end. Assuming management fees is based on assets under management at year end and incentive fee is calculated net of management fee, what is the total fees earned by the fund? Answer in millions of dollars to two decimal places.
| 10,320,000 |
initial_investment = 120000000.0
return_per = 0.35
management_fee_per = 0.02
performance_fee_per = 0.2
fund_growth = initial_investment * return_per
management_fee = initial_investment * management_fee_per
performance_fee = (fund_growth - management_fee) * performance_fee_per
total_fees = management_fee + performance_fee
round(total_fees)
|
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| null |
On January 1, year 1, Alpha Co. signed an annual maintenance agreement with a software provider for $15,000 and the maintenance period begins on March 1, year 2. Alpha also incurred $5,000 of costs on January 1, year 1, related to software modification requests that will increase the functionality of the software. Alpha depreciates and amortizes its computer and software assets over five years using the straight-line method. What amount is the total expense that Alpha should recognize related to the maintenance agreement and the software modifications for the year ended December 31, year 1? Answer to the nearest dollar.
| 13,500 |
annual_fee = 15000.0
software_costs = 5000.0
useful_life = 5.0
months_lapsed = 10.0
amortized_expense = annual_fee / 12.0
depreciation_expense = software_costs / useful_life
total_expense = (amortized_expense * months_lapsed) + depreciation_expense
round(total_expense)
|
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| null |
The notes to a company's financial statements disclose the present value of lease payments relating to the next five years as $35,000. These payments concern an operating lease,which the company had entered into two years ago. If the company's total assets and equity are $450,000 and $300,000, respectively, what is the debt-to-equity ratio after capitalizing the effect of the lease transaction? Answer as a percentage to a single decimal place.
| 61.7 |
lease_payments = 35000
total_assets = 450000
total_equity = 300000
debt = total_assets - total_equity + lease_payments
debt_to_equity = 100.0 * (debt / total_equity)
round(debt_to_equity, 1)
|
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| null |
On March 1, 2013 a customer subscribed to a monthly newsletter paying an annual fee of $1,440 on that day. The news agency's financial year ends on December 31, 2013. What is the adjustment required to the company's liabilities with respect to the specific transaction at year-end? Answer to the closest dollar.
| 1,200 |
annual_fee = 1440.0
march_month_number = 3
december_month_number = 12
total_months = (december_month_number - march_month_number) + 1
monthly_rate = annual_fee / 12.0
total_liability = monthly_rate * total_months
round(total_liability)
|
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| null |
An investment project cost $1 million to undertake and will deliver $2 million in five years' time. The discount rate is 10%. What is the project's NPV? Answer to the nearest dollar.
| 241,843 |
initial_investment = 1000000
discount_rate = 0.10
years_until_payoff = 5
payoff = 2000000
pv = payoff / ((1 + discount_rate) ** years_until_payoff)
npv = pv - initial_investment
round(npv)
|
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| null |
Sasha Audrey, a financial analyst, is preparing a report on Vault Managers (VMA), a financial management firm in Chicago, USA. Audrey has accumulated information about the firm to estimate key financial ratios. The following exhibit displays this information. Exhibit: Selective Financial Information of Vault Managers (in thousands of US dollars) December 31, 2011.
Revenues: $405,000
Cost of services: $85,200
Interest: $135,500
Selling, general, and administrative expenses: 75,000
Depreciation: 45,500
Tax Rate: 35%
What is VMA's operating profit margin? Answer as a percentage to two decimal places.
| 49.21 |
revenue = 405000.0
cogs = 85200.0
admin_expenses = 75000.0
depreciation = 45500.0
operating_margin = (revenue - cogs - depreciation - admin_expenses) / revenue
operating_margin_percent = 100.0 * operating_margin
round(operating_margin_percent, 2)
|
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| null |
A $500 par-value convertible debenture is selling at $520. If the conversion ratio is 20, what is the conversion price? Answer to the nearest cent.
| 25 |
par_value = 500
conversion_ratio = 20
price = 520.0
conversion_price = par_value / conversion_ratio
round(conversion_price, 2)
|
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| null |
Box a nongovernmental not-for-profit organization had the following transactions during the year:
Proceeds from sale of investments: $80000
Purchase of property plant and equipment: $10000
Proceeds from long-term debt: $100000
Loss on sale of investment: $5000
What amount should be reported as net cash provided by financing activities in Box's statement of cash flows? Answer to the nearest dollar.
| 100,000 |
sale_of_investments = 80000
ppe = 10000
long_term_debt = 100000
loss_on_sale = 50000
net_cash_finance = long_term_debt
round(net_cash_finance)
|
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| null |
Consider a put option selling for $4 in which the exercise price is $34 and the price of the underlying is $36. If the price of the underlying at expiration is $37, what is the profit for the option seller? Answer to the nearest dollar.
| 4 |
exercise_price = 34
underlying_price = 36
expiration_price = 37
option_price = 4
profit = option_price - max(0, exercise_price - expiration_price)
round(profit)
|
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| null |
Mentor Co. a U.S. corporation owned 100% of a Swiss corporation. The Swiss franc is the functional currency. The remeasurement of Mentor's financial statements resulted in a $25000 gain at year end. The translation of the financial statements resulted in a $40000 gain at year end. What amount should Mentor recognize as foreign currency gain in its income statement? Answer to the closest dollar.
| 25,000 |
remeasurement_gain = 25000.0
translation_gain = 40000.0
foreign_currency_gain = remeasurement_gain
round(foreign_currency_gain)
|
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| null |
Johnson worked for ABC Co. and earned a salary of $100,000. Johnson also received, as a fringe benefit, group termlife insurance at twice Johnson's salary. The annual IRS established uniform cost of insurance is $2.76 per $1,000. What amount must Johnson include in gross income? Answer to the nearest dollar.
| 100,414 |
salary = 100000
fringe_benefit = 2 * salary
insurance_cost_rate = (2.76 / 1000.0)
insurance_non_taxable = 50000
insurance_taxable = fringe_benefit - insurance_non_taxable
insurance_total = insurance_taxable * insurance_cost_rate
gross_income = salary + insurance_total
round(gross_income)
|
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| null |
Laura Martin, CFA, is a British investor currently holding Singaporean equities. She is exploring arbitrage opportunities in the forward foreign currency market. The current GBP/SGD spot exchange rate is 2.1050. She has devised the following strategy: Invest SGD for twelve months in risk-free zero coupon bonds at a rate of 4.5%. At the end of the term convert the SGD to the GBP at an agreed upon forward rate of GBP/SGD 2.0303. What is the return on the strategy in domestic currency terms? Answer as a percentage to two decimal places.
| 0.79 |
spot_exchange_rate = 2.1050
domestic_interest_rate = 0.045
forward_exchange_rate = 2.0303
return_on_strategy = (1/spot_exchange_rate) * (1 + domestic_interest_rate) * forward_exchange_rate - 1
percentage_return = 100 * return_on_strategy
round(percentage_return, 2)
|
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| null |
In the current financial year, a company has paid a dividend per share of $5. The company has always maintained a retention rate of 30% and expects to continue to do so in the long-run. The average return on equity is equal to 15%. The company's shareholders' required return on equity is 20%. What is the company's justified price-to-earnings (P/E) ratio? Answer to two decimal places.
| 4.52 |
retention_rate = 0.3
return_on_equity = 0.15
required_return = 0.2
growth_rate = 0.3 * 0.15
dividend_payout_ratio = 1 - retention_rate
justified_pe = dividend_payout_ratio / (required_return - growth_rate)
round(justified_pe, 2)
|
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| null |
Greene is the sole shareholder of Seagull, a calendar-year S corporation. Greene's basis at the beginning of the year is $15,000. Seagull reported an ordinary loss of $5,000 and $2,000 of municipal bond interest for the year. Seagull distributed cash of $6,000 to Greene on November 1. What is Greene's basis in Seagull at the end of the year? Answer to the closest dollar.
| 6,000 |
beginning_basis = 15000.0
ordinary_loss = -5000.0
bond_interest = 2000.0
distribution = -6000.0
end_basis = beginning_basis + ordinary_loss + bond_interest + distribution
round(end_basis)
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| null |
A company's first IFRS reporting period is for the year ended December 31, year 2. While preparing the year 2 statement of financial position, management identified an error in which a $90,000 loss accrual was not recorded. $40,000 of the loss accrual related to a year 1 event and $50,000 related to a year 2 event. What amount of loss accrual should the company report in its December 31, year 1, IFRS statement of financial position? Answer to the nearest dollar.
| 40,000 |
year1_loss = 40_000
year2_loss = 50_000
total_loss = 90_000
year1_accrual = year1_loss / total_loss * total_loss
round(year1_accrual)
|
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| null |
Carson owned 40% of the outstanding stock of a C corporation. During a tax year, the corporation reported $400,000 in taxable income and distributed a total of $70,000 in cash dividends to its shareholders. Carson accurately reported $28,000 in gross income on Carson's individual tax return. If the corporation had been an S corporation and the distributions to the owners had been proportionate, how much income would Carson have reported on Carson's individual return? Answer to the nearest dollar.
| 160,000 |
c_corp_taxable_income = 400000
total_distributed_dividends = 70000
carson_owned_percentage = 0.40
carson_gross_income = 28000
s_corp_distribution = total_distributed_dividends * carson_owned_percentage
carson_s_corp_income = s_corp_distribution * (c_corp_taxable_income / total_distributed_dividends)
round(carson_s_corp_income)
|
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| null |
Mark Taylor is an equity investor who has recently purchased the stock of a Kenyan enterprise. The risk-free rate of return in Kenya is 4.5% while the expected return on the market index is 7.2%. The correlation of the stocks purchased with the market index has recently increased from 0.6 to 0.8 and the standard deviation of the stock and market index is 25.7% and 16.4% respectively. What is the expected return on the Kenyan stock? Answer as a percentage to two decimal places.
| 7.88 |
rf = 0.045
rm = 0.072
correlation = 0.8
sigma_stock = 0.257
sigma_market = 0.164
expected_return = rf + correlation * (rm - rf) * (sigma_stock / sigma_market)
round(expected_return * 100, 2)
|
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| null |
Vital Corp. is an accrual-basis calendar-year C corporation. Its year 2 reported book income before federal income taxes was $500000. Included in that amount were the following items:
Year 1 state franchise tax refund: $50000
Municipal bond interest income: $7500
What should be the amount of Vital's year 2 taxable income as reconciled on Vital's Schedule M-1 of Form 1120 U.S. Corporation Income Tax Return? Answer to the nearest dollar.
| 492,500 |
book_income = 500000.0
state_franchise_tax_refund = 50000.0
municipal_bond_interest = 7500.0
taxable_income = book_income - municipal_bond_interest
round(taxable_income)
|
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| null |
You bought a limousine for $98,000 and are planning to rent it for weddings, ceremonies and parties at $245 per hour. If you estimate the car will be hired for 2 hours a day on average, with daily costs at about $50, what is the estimated yearly yield on your investment if you work all year round, i.e. every day of the year, including any festivities and weekends? Answer as a percentage.
| 164 |
limo_cost = 98000.0
hourly_rate = 245.0
avg_hours_per_day = 2
cost_per_day = 50.0
avg_rate_per_day = avg_hours_per_day * hourly_rate
net_cost_per_day = avg_rate_per_day - cost_per_day
days_per_year = 365
total_earned = days_per_year * net_cost_per_day
yearly_yield = 100.0 * (total_earned / limo_cost)
round(yearly_yield)
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| null |
Brill Co. made the following expenditures relating to Product X:
Labor and material costs incurred in producing a prototype $100000
Cost of testing the prototype $40000
Legal costs to file a patent $5000
Production of Product X commenced when the patent was granted. What amount of the above costs should be expensed as research and development costs? Answer to the nearest dollar.
| 140,000 |
labor_material = 100000
testing = 40000
legal = 5000
total_cost = labor_material + testing + legal
research_development = labor_material + testing
round(research_development)
|
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| null |
A shoe retailer allows customers to return shoes within 90 days of purchase. The company estimates that 5% of sales will be returned within the 90-day period. During the month, the company has sales of $200,000 and returns of sales made in prior months of $5,000. What amount should the company record as net sales revenue for new sales made during the month? Answer to the nearest dollar.
| 190,000 |
return_estimate = 0.05
sales = 200000
returns_prior = 5000
net_sales_revenue = sales * (1 - return_estimate)
round(net_sales_revenue)
|
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| null |
Large City does not use the modified approach to account for roads. At the beginning of the current year the city spent $800000 on new roads. The roads have a 20-year useful life. What amount should Large City report as an expense related to the new roads in the statement of activities for the current year? Answer to the closest dollar.
| 40,000 |
initial_cost = 800000.0
useful_life = 20
annual_expense = initial_cost / useful_life
round(annual_expense)
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| null |
Aln Co. incurred the following expenses during the current period: Routine on-going efforts to improve an existing product $50000 Trouble-shooting in connection with breakdowns during commercial production $75000 Routine testing of products during commercial production for quality-control purposes $100000 What is the total amount of research and development expense incurred by Aln during the current period? Answer to the nearest dollar.
| 0 |
routine_improvements = 50000
troubleshooting = 75000
routine_testing = 100000
total_r_and_d_expense = 0
round(total_r_and_d_expense)
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| null |
A 20% target contribution margin is set for Duct which is a new product with the following unit costs:
Manufacturing costs Variable $12
Fixed 8
Selling & admin. Costs Variable $3
Fixed 5
What is Duct's target selling price? Answer to the nearest cent.
| 18.75 |
manufacturing_costs_variable = 12
manufacturing_costs_fixed = 8
selling_and_admin_costs_variable = 3
selling_and_admin_costs_fixed = 5
target_contribution_margin = 0.20
total_variable_costs = manufacturing_costs_variable + selling_and_admin_costs_variable
target_selling_price = total_variable_costs / (1 - target_contribution_margin)
round(target_selling_price, 2)
|
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| null |
Securities A, B and C have an expected return of respectively 7%, 12% and 5%. What is the expected return of an equal weighted portfolio composed of Securities A and C? Answer as a percentage.
| 6 |
w_A = 0.5
w_B = 0.0
w_C = 0.5
exp_ret_A = 0.07
exp_ret_B = 0.12
exp_ret_C = 0.05
portfolio_exp_ret = (w_A * exp_ret_A) + (w_B * exp_ret_B) + (w_C * exp_ret_C)
round(portfolio_exp_ret * 100, 1)
|
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| null |
A company sells DVD players for $200 per unit. The players have a unit variable cost of $160. The company estimates that it will sell one home entertainment system for every four DVD players sold. Home entertainment systems have a unit variable cost of $460 and sell for $600 per unit. The company's fixed costs are $90000. Assuming that the sales mix estimate is correct how many DVD players need to be sold for the company to break even? Answer in number of DVD players.
| 1,200 |
dvd_price = 200
dvd_cost = 160
ent_price = 600
ent_cost = 460
fixed_cost = 90000
dvd_profit = dvd_price - dvd_cost
ent_profit = ent_price - ent_cost
dvd_ent_ratio = 1 / 4
dvd_units_needed = (fixed_cost / (dvd_profit + (ent_profit * dvd_ent_ratio)))
round(dvd_units_needed, 1)
|
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| null |
Darv Co. had a current ratio of 3-to-1 and a quick ratio of 1-to-1. Current liabilities were $322000. What was the total amount for inventory and prepaid expenses? Answer to the nearest dollar.
| 644,000 |
curr_ratio = 3
quick_ratio = 1
curr_liabilities = 322000.0
total_assets = curr_liabilities * curr_ratio
inventory_and_prepaid = total_assets - curr_liabilities
round(inventory_and_prepaid)
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| null |
An investment will pay out $10 p.a. forever. What is that investment worth if the market discount rate is 5%? Answer to the nearest dollar.
| 200 |
annual_cash_flow = 10
discount_rate = 0.05
present_value = annual_cash_flow / discount_rate
round(present_value)
|
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| null |
The expected selling price for a new product is $19.00. Management's goal is to obtain a 20% contribution margin on all sales. If the new product has variable selling and distribution costs of $3.00 per unit what is the product's target variable manufacturing cost? Answer to the closest cent
| 12.2 |
expected_price = 19.00
target_margin = 0.20
variable_costs = 3.00
target_variable_cost = expected_price * (1 - target_margin) - variable_costs
round(target_variable_cost, 2)
|
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| null |
In the current year Vinton exchanged unimproved land for an apartment building. The land had a basis of $300000 and a fair market value (FMV) of $420000 and was encumbered by a $100000 mortgage. The apartment building had an FMV of $550000 and was encumbered by a $230000 mortgage. Each party assumed the other's mortgage. What is Vinton's basis in the office building? Answer to the nearest dollar.
| 430,000 |
land_basis = 300000.0
land_FMV = 420000.0
land_mortgage = 100000.0
building_FMV = 550000.0
building_mortgage = 230000.0
vinton_basis = land_basis + (building_mortgage - land_mortgage)
round(vinton_basis)
|
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| null |
What is the price of a two-year bond (face value $100), paying 4% coupons semi-annually, with a yield of 8%? Answer to the nearest cent.
| 92.74 |
face_value = 100.0
coupon_rate = 0.04
years_til_maturity = 2
rate_of_interest = 0.08
compounds_per_year = 2
C = face_value / 2 * coupon_rate
r = rate_of_interest / 2
T = compounds_per_year * years_til_maturity
semi_annual_values = [ C / ((1 + r) ** t) for t in range(1, T + 1)]
semi_annual_total = sum(semi_annual_values)
pv_for_face_value = face_value / ((1 + r) ** T)
price = pv_for_face_value + semi_annual_total
round(price, 2)
|
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| null |
What is the present value of $10 received in two years' time if the discount rate is 9%? Answer to the closest cent.
| 8.42 |
cash_flow = 10.0
discount_rate = 0.09
years_til_cash_flow = 2
pv = cash_flow / ((1 + discount_rate) ** years_til_cash_flow)
round(pv, 2)
|
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| null |
If the amount of money that can be created from an additional deposit of $200 in a deposit account is $2,500, what is the money multiplier? Answer to one decimal place.
| 12.5 |
additional_deposit = 200
total_created = 2500
money_multiplier = total_created / additional_deposit
round(money_multiplier, 1)
|
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| null |
West is single has no dependents and does not itemize. West provides the following information regarding his current-year's return:
Long-term capital gain $15000
Percentage depletion in excess of property's adjusted basis 9000
Dividends from publicly-held companies 10000
What is the amount of West's AMT tax preference items? Answer to the nearest dollar.
| 9,000 |
long_term_capital_gain = 15000
percentage_depletion = 9000
dividends = 10000
amt_preferences = percentage_depletion
round(amt_preferences)
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| null |
Gem Inc. has paid a dividend of $4.55 in the current year. From next year onwards, annual dividend will grow at an indefinite rate of 2%. The company's shareholders require an 8% return to compensate for the risk associated with equity shares. What is the intrinsic value of the stock? Answer to the closest cent.
| 77.35 |
current_dividend = 4.55
expected_growth_rate = 0.02
required_return = 0.08
intrinsic_value = current_dividend * ((1 + expected_growth_rate) / (required_return - expected_growth_rate))
round(intrinsic_value, 2)
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| null |
A T-bill has a face value of $1 million and 180 days until maturity. The security is selling for $970,000. What is the yield on a bank discount basis? Assume there are 360 days in a year. Answer as a percentage to two decimal places.
| 6 |
face_value = 1000000.0
days_til_maturity = 180.0
price = 970000.0
discount = face_value - price
yield_rate = (discount / face_value) * (360 / 180)
yield_rate_per = 100.0 * yield_rate
round(yield_rate_per)
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| null |
Simm Co. has determined its December 31 inventory on a LIFO basis to be $400,000. Information pertaining to the inventory follows:
Estimated selling price: $408,000
Estimated cost of disposal: 20,000
Normal profit margin: 60,000
Current replacement cost: 390,000
At December 31, what should be the amount of Simm's inventory? Answer to the nearest dollar.
| 388,000 |
selling_price = 408000
cost_of_disposal = 20000
normal_profit_margin = 60000
current_replacement_cost = 390000
inventory = selling_price - cost_of_disposal
round(inventory)
|
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| null |
On January 1, year 1, a company purchased equipment for $100 million. The equipment consists of four major components, of which two components comprise 80% of the total cost and each has a 20-year useful life. The remaining two components have costs of $10 million each; one of them has a useful life of four years, and the other has a useful life of five years. The company applies the cost model to the equipment and uses the straight-line method of depreciation. Under IFRS, what is the depreciation expense for the year ended December 31, year 1? Answer to the nearest dollar.
| 8,500,000 |
cost = 100000000.0
life1 = 20
life2 = 4
life3 = 5
cost1 = 80000000.0
cost2 = 10000000.0
cost3 = 10000000.0
depreciation_expense = (cost1 / life1) + (cost2 / life2) + (cost3 / life3)
round(depreciation_expense, 1)
|
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| null |
Sash Imperial has undertaken a contract to build a railroad line. The project will take three years to complete and Sash is expected to receive $40.00 million on completion. Total project costs are estimated at $31 million. At the end of the first year Sash has spent $12.00 million and expects to incur a total loss of $0.50 million over the remaining project term. Sash complies with U.S. GAAP. What is the amount recognized by Sash in its income statement at the end of Year 1, in relation to the project? Answer in the millions of dollars to two decimal places.
| 2.98 |
total_cost = 31
total_income = 40
cost_incurred = 12
expected_loss = 0.5
income_recognized = (total_income - total_cost) * (cost_incurred / total_cost) - expected_loss
round(income_recognized, 2)
|
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| null |
King, Inc. owns 70% of Simmon Co's outstanding common stock. King's liabilities total $450,000, and Simmon's liabilities total $200,000. Included in Simmon's financial statements is a $100,000 note payable to King. What amount of total liabilities should be reported in the consolidated financial statements? Answer to the closest dollar.
| 550,000 |
king_liabilities = 450000.0
simmons_liabilities = 200000.0
king_note = 100000.0
total_liabilities = king_liabilities + (simmons_liabilities - king_note)
round(total_liabilities)
|
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| null |
Best County's capital projects fund had the following receipts during the year:
Transfer from the general fund: $100000
Federal capital grant: $75000
Special assessment for capital improvements: $300000
What amount of revenues should Best County report in its capital projects fund at the end of the year? Answer to the closest dollar.
| 375,000 |
transfer = 100000
capital_grant = 75000
capital_improve_assessment = 300000
revenues = capital_improve_assessment + capital_grant
round(revenues)
|
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| null |
Sunshine Corp. a wholly owned subsidiary of Pierpoint Corp. purchased land from Pierpoint for its fair market value of $10000 on January 1 of the previous tax year. Pierpoint's adjusted basis of the land on the date of sale was $8000. During the current tax year Sunshine sold the land for $9000 to an unrelated taxpayer. What gain or loss will be reported on a consolidated tax return filed by Sunshine and Pierpoint for the current tax year? Answer to the nearest dollar.
| 1,000 |
purchase_price = 10000.0
basis = 8000.0
sale_price = 9000.0
gain_or_loss = sale_price - basis
round(gain_or_loss)
|
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| null |
Spark Co. buys cordless phones for $125 each and sells them for $200 each. Spark pays a sales commission of $25 per phone sold and monthly fixed costs are $3000. Assuming Spark desired a profit of 10% of sales how many units must Spark sell? Answer in units.
| 100 |
cost_per_phone = 125
selling_price = 200
sales_commission = 25
monthly_fixed_costs = 3000
desired_profit = 0.10 * selling_price
net_profit = selling_price - cost_per_phone - sales_commission - desired_profit
units_needed = monthly_fixed_costs / net_profit
round(units_needed, 1)
|
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| null |
Michael Poole is an equity analyst at Dave Associates, a financial services firm. Poole is estimating the firm's cost of equity using the dividend discount model approach. He has learnt that the Gordon's growth model is particularly useful in deriving the required rate of return when this approach is used. The company has paid a dividend of $2.5 per share in the previous year. The current market price per share is $25. The company's retention rate and return on equity is 40% and 10%, respectively. What is the cost of equity using the dividend discount model? Answer as a percentage to two decimal places.
| 14.4 |
dividend_price_per_share = 2.5
current_price_per_share = 25
retention_rate = .4
return_on_equity = .1
growth_rate = retention_rate * return_on_equity
next_dividend_per_share = (dividend_price_per_share * (1 + growth_rate))
cost_of_equity = (next_dividend_per_share / current_price_per_share) + growth_rate
round(100.0 * cost_of_equity, 2)
|
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| null |
On May 1 of the prior year, Baker purchased equipment with a five-year useful life for a cost of $10,000. Baker adopted the MACRS depreciation system and did not utilize any special depreciation deductions. On March 1 of the current year, Baker sold the equipment. The MACRS depreciation schedule for five-year property is listed below:
First year - 20.00%
Second year - 32.00%
Third year - 19.20%
What amount of depreciation can Baker deduct in the current year? Answer to the closest dollar.
| 1,600 |
life_years = 5.0
cost = 10000.0
first_year = 0.2
second_year = 0.32
third_year = 0.1920
depreciation_convention = 0.5
depreciation_method = 2.0
depreciation_in_year_one = cost * (1/life_years) * depreciation_convention * depreciation_method
subsequent_depreciation = (cost - depreciation_in_year_one) * (1.0 / life_years)
round(subsequent_depreciation)
|
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| null |
Aston and Becker are equal partners in AB Partnership. In the tax year the ordinary income of the partnership is $20000 and the partnership has a long-term capital gain of $12000. Aston's basis in AB was $40000 and he received distributions of $5000 during the year. What is Aston's share of AB's ordinary income? Answer to the nearest dollar.
| 10,000 |
ordinary_income = 20000
capital_gain = 12000
partners_share = 0.5
aston_basis = 40000
aston_distributions = 5000
aston_ordinary_income = ordinary_income * partners_share
round(aston_ordinary_income)
|
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| null |
Grant Co.'s sales budget shows the following projections for the year ending December 31: Quarter Units First 30000 Second 40000 Third 22500 Fourth 27500 Total 120000 Inventory at the beginning of the year was budgeted at 9000 units. The quantity of finished goods inventory at the end of each quarter is to equal 30% of the next quarter's budgeted sales of units. What amount should the production budget show for units to be produced during the first quarter? Answer in units.
| 33,000 |
q1 = 30000.0
q2 = 40000.0
q3 = 22500.0
q4 = 27500.0
beginning_inventory = 9000.0
budget = 0.30
amount = (q2 * budget) + q1 - beginning_inventory
round(amount)
|
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| null |
A U.S. manufacturer has a production operation in Mexico. The product costs 116.50 pesos to produce and ship to Europe, where the product sells for 20 euros. If 0.1099 U.S. dollars are required to buy one Mexican peso, and 0.8928 U.S. dollars are required to buy one euro, what amount of U.S. dollars is the profit on the sale? Answer to the closest cent.
| 5.06 |
cost_in_pesos = 116.50
price_in_euros = 20.0
usd_per_peso = 0.1099
usd_per_euro = 0.8928
cost_in_usd = cost_in_pesos * usd_per_peso
price_in_usd = price_in_euros * usd_per_euro
profit_in_usd = price_in_usd - cost_in_usd
round(profit_in_usd, 2)
|
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| null |
A 181-day Treasury bill has a face value of $10.000 million and a present value of $9.219 million. Assuming a 360-day year, what is the instrument's discount rate? Answer as a percentage with two decimal places
| 15.53 |
face_value = 10000
present_value = 9219
days_in_year = 360
days_til_maturity = 181
discount_rate = ((face_value - present_value) / (face_value)) * (days_in_year / days_til_maturity)
discount_rate = round(discount_rate * 100, 2)
|
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| null |
Alex Gerald is examining his budget constraint given his current income and expenditures. Gerald has a total budget of $125 per week to spend on milk or juices. The price of milk is $3.5/litre and the price of juice is 2.5/litre. If the quantity of milk is measured on the horizontal axis of the budget constraint, what is the slope of the budget constraint? Answer to two decimal places.
| -1.4 |
total_budget = 125.0
price_milk = 3.5
price_juice = 2.5
slope = -1.0 * (price_milk / price_juice)
round(slope, 2)
|
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| null |
Zarr Town levied property taxes of $500000 of which 1% is expected to be uncollectible. During the year Zarr Town collected $450000. What amount of property tax revenue should Zarr Town report in its government-wide statement of activities for the current year? Answer to the nearest dollar.
| 495,000 |
levied_taxes = 500000.0
expected_uncollectible = 0.01
collected_taxes = 450000.0
reported_taxes = levied_taxes - (levied_taxes * expected_uncollectible)
round(reported_taxes)
|
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| null |
Lake Trust a simple trust reported the following items of income and expense during the year:
Dividend income: $2500
Taxable interest income: 2000
Capital gains (allocable to corpus): 5000
Accounting fees (allocable to income): (500)
Trustee fees (allocable to income): (750)
What is Lake's distributable net income? Answer to the nearest dollar.
| 3,250 |
dividend_income = 2500
taxable_interest_income = 2000
capital_gains = 5000
accounting_fees = 500
trustee_fees = 750
taxable_income = dividend_income + taxable_interest_income + capital_gains - accounting_fees - trustee_fees
net_income = taxable_income - capital_gains
round(net_income)
|
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| null |
A portfolio manager has purchased $2.5 million worth of equity investments for several of its client accounts. The purchase is financed using a combination of cash and equity. The manager must abide by a minimum margin requirement of 35%. Given the maintenance margin requirement, if the purchase price rises by 15%, what is the return on equity investment in the manager's leveraged position (ignoring interest costs and commission)? Answer as a percentage to two decimal places.
| 42.86 |
purchase_price = 2500000.0
margin_requirement = 0.35
purchase_margin = purchase_price * margin_requirement
appreciation = 0.15
value_after_appreciation = purchase_price * (1 + appreciation)
leverage_return = (value_after_appreciation - purchase_price) / purchase_margin * 100.0
round(leverage_return, 2)
|
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| null |
Carter Co. had the following items on its balance sheet at the end of the current year:
Cash and cash equivalents $ 200000
Short-term investments 100000
Accounts receivable 400000
Inventories 600000
Patent 10 years 300000
Equipment 1000000
Accumulated depreciation 200000
The amount of current liabilities at the end of the current year was $640000. What is Carter's working capital at the end of the current year? Answer to the closest dollar.
| 660,000 |
cash_and_cash_equivalents = 200000
short_term_investments = 100000
accounts_receivable = 400000
inventories = 600000
patent = 300000
equipment = 1000000
accumulated_depreciation = 200000
current_liabilities = 640000
current_assets = cash_and_cash_equivalents + short_term_investments + accounts_receivable + inventories
working_capital = current_assets - current_liabilities
round(working_capital)
|
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| null |
White Rock Enterprises (WREN) reported income tax expense of $6.5 million over the past year. During the same year, taxes payable and deferred tax assets increased by $2 million and $0.85 million respectively. WREN reports no deferred tax liabilities. Over the recent year, what is the cash paid by WREN for income taxes? Answer in millions of dollars to two decimal places.
| 5.35 |
income_tax_expense = 6.5
change_in_taxes_payable = 2
change_in_deferred_tax_assets = 0.85
cash_paid_for_income_taxes = income_tax_expense + change_in_deferred_tax_assets - change_in_taxes_payable
round(cash_paid_for_income_taxes, 2)
|
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| null |
Rune Co.'s checkbook balance on December 31 was $10000. On that date Rune held the following items in its safe: $4000 check payable to Rune postdated January 3 and not included in the December 31 checkbook balance in collection of a sale made in December. $1000 check payable to Rune deposited December 15 and included in the December 31 checkbook balance but returned by the bank on December 30 stamped NSF". The check was redeposited on January 2 and cleared on January 9. What amount should Rune report as cash in its December 31 balance sheet?" Answer to the nearest dollar.
| 9,000 |
checkbook_balance = 10000.0
postdated_check = 4000.0
nsf_check = 1000.0
cash_in_safe = postdated_check + nsf_check
cash_in_balance_sheet = checkbook_balance - nsf_check
round(cash_in_balance_sheet)
|
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| null |
A share with standard deviation of 46% is trading in a market where the expected return on the market portfolio is 16% and its standard deviation is 28%. If the risk free rate is 4.5% and the share is uncorrelated with the market, what is the expected return of the share? Answer as a percentage with two decimal places.
| 4.5 |
sd_share = 0.46
sd_market = 0.28
expected_return_market = 0.16
r_f = 0.045
beta = 0.0
expected_return_share = r_f + (beta * (expected_return_market - r_f))
round(expected_return_share * 100, 2)
|
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| null |
Smile Inc. purchased a computer on May 1 for $12000 with an estimated salvage value of $1500 and a 3-year life. What is the depreciation expense for the year ended December 31 using the double-declining method of depreciation? Answer to the nearest dollar.
| 5,333 |
cost = 12000.0
salvage_value = 1500.0
life_years = 3.0
depreciation_rate = (1 / life_years)
ddb_depreciation = (2.0 * depreciation_rate)
may_month = 5
dec_month = 12
total_months = (dec_month - may_month) + 1
pro_rate = total_months / 12.0
expense = ddb_depreciation * (cost * pro_rate)
round(expense)
|
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| null |
Ilkot Inc. is a manufacturer of skiing equipment that has purchased an automated paint coating unit for $600,000. The unit has an estimated useful life of eight years and a residual value of $10,000. Using the double declining balance method, what is the unit's net book value in the second year of its useful life? Answer to the closest dollar.
| 337,500 |
cost = 600000
residual_value = 10000
life_years = 8
straight_line_depreciation = 1.0 / life_years
ddb_depreciation = (2 * straight_line_depreciation)
year_one_depreciation = ddb_depreciation * cost
year_one_nbv = cost - year_one_depreciation
year_two_depreciation = year_one_nbv * ddb_depreciation
year_two_nbv = year_one_nbv - year_two_depreciation
round(year_two_nbv)
|
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| null |
Smythe Co. invested $200 in a call option for 100 shares of Gin Co. $.50 par common stock, when the market price was $10 per share. The option expired in three months and had an exercise price of $9 per share. What was the intrinsic value of the call option at the time of initial investment? Answer to the nearest dollar.
| 100 |
stock_price = 10.0
option_price = 0.50
exercise_price = 9.0
initial_investment = 200.0
intrinsic_value = (stock_price - exercise_price) * 100.0
round(intrinsic_value)
|
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| null |
A trader purchases a share of stock on margin at its current market price of $80. The initial margin requirement is 30%. What is the margin requirement for each share of stock? Answer to the nearest dollar.
| 24 |
stock_price = 80
margin_percentage = 0.30
margin_required = stock_price * margin_percentage
round(margin_required)
|
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| null |
A bond with a five-year maturity, paying 8% coupons and with a face value of $100, is bought at 104.1 in year 0, when it is issued. If I need to sell the bond at the the end the third year, when its prevailing price is 82, what is my holding period return on this investment? (Assume coupons are not reinvested.) HINT: Accumulate all coupons. Answer to the nearest percentage.
| 2 |
face_value = 100
coupon_rate = 0.08
years_til_maturity = 5
interest_rate = 0.06
initial_price = 104.1
final_price = 82
coupon = face_value * coupon_rate
accumulated_coupon = (coupon * 3)
holding_period_return = ((final_price + accumulated_coupon) / initial_price) - 1
round(100 * holding_period_return, 0)
|
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| null |
Mill Co. reported pretax income of $152500 for the year ended December 31. During the year-end audit the external auditors discovered the following errors:
Ending inventory $30000
Overstated Depreciation expense $64000
What amount should Mill report as the correct pretax income for the year ended December 31? Answer to the closest dollar.
| 58,500 |
reported_income = 152500
ending_inventory = 30000
depreciation_expense = 64000
pretax_income = reported_income - ending_inventory - depreciation_expense
round(pretax_income)
|
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| null |
Smith has an adjusted gross income (AGI) of $120,000 without taking into consideration $40,000 of losses from rental real estate activities. Smith actively participates in the rental real estate activities. What amount of the rental losses may Smith deduct in determining taxable income? Answer to the nearest dollar.
| 15,000 |
agi = 120000
losses = 40000
phase_out = 0.4
max_deduction = 25000
allowed = max_deduction - (phase_out * max_deduction)
round(allowed)
|
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| null |
Pine Co. purchased land for $450000 as a factory site. An existing building on the site was razed before construction began. Additional information is as follows: Cost of razing old building $60000 Title insurance and legal fees to purchase land $30000 Architect's fees $95000 New building construction cost $1850000 What amount should Pine capitalize as the cost of the completed factory building? Answer to the nearest dollar.
| 1,945,000 |
land = 450000
razing = 60000
insurance_and_legal = 30000
architects = 95000
construction = 1850000
building_cost = construction + architects
round(building_cost)
|
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| null |
You are assessing a bond that matures in four years yielding 5%. Its annual coupon is 5% and the face value is 100. What is the Macaulay Duration of the bond?
| 3.72 |
maturity = 4
face = 100
coupon = .05
ytm = .05
time_weighted_cfs = []
cfs = []
for yr in range(1, maturity + 1):
time_weighted_cfs.append(coupon * face * yr / (1 + ytm) ** yr)
cfs.append(coupon * face/ (1 + ytm) ** yr)
if yr == maturity:
time_weighted_cfs.append(face * yr / (1 + ytm) ** yr)
cfs.append(face / (1 + ytm) ** yr)
answer = sum(time_weighted_cfs) / sum(cfs)
round(answer, 2)
|
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| null |
There is an annual coupon bond with a Macaulay Duration of 4.5 that is yielding 6%. What is its modified duration?
| 4.25 |
macaulay_duration = 3.7232
ytm = .05
annual_payments = 12
modified_duration = macaulay_duration / (1 + ytm / annual_payments)
answer = modified_duration
round(answer,2)
|
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| null |
You are considering purchasing a semi-annual coupon bond that pays 5%, yields 6.5%, has a face value of 100, and matures in 10 years. What is the Macaulay Duration of the bond?
| 7.85 |
maturity = 10
face = 100
coupon = .05
ytm = .065
annual_payments = 2
time_weighted_cfs = []
cfs = []
for period in range(1, maturity * annual_payments + 1):
yr = period / annual_payments
cfs.append((coupon * face / annual_payments) / (1 + ytm / annual_payments)**period)
time_weighted_cfs.append(yr * (coupon * face / annual_payments) / (1 + ytm / annual_payments)**period)
if yr == maturity:
cfs.append(face / (1 + ytm / annual_payments)**period)
time_weighted_cfs.append(yr * face / (1 + ytm / annual_payments)**period)
answer = sum(time_weighted_cfs) / sum(cfs)
round(answer, 2)
|
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| null |
You are considering purchasing a quarterly coupon bond that pays 6%, yields 4.5%, has a face value of 100, and matures in 6 years. What is the Macaulay Duration of the bond?
| 5.12 |
maturity = 6
face = 100
coupon = .06
ytm = .045
annual_payments = 4
time_weighted_cfs = []
cfs = []
for period in range(1, maturity * annual_payments + 1):
yr = period / annual_payments
cfs.append((coupon * face / annual_payments) / (1 + ytm / annual_payments)**period)
time_weighted_cfs.append(yr * (coupon * face / annual_payments) / (1 + ytm / annual_payments)**period)
if yr == maturity:
cfs.append(face / (1 + ytm / annual_payments)**period)
time_weighted_cfs.append(yr * face / (1 + ytm / annual_payments)**period)
answer = sum(time_weighted_cfs) / sum(cfs)
round(answer, 2)
|
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| null |
You own a bond with a modified duration of 4 and a convexity of 47. You are fearing an instantaneous drop in yields of 100bp. What percentage change in value would you expect for your bond?
| 4.23 |
modified_duration = 4
convexity = 47
change_in_yield = -100 / 10000
change_in_price = -modified_duration * change_in_yield + .5 * convexity * change_in_yield ** 2
answer = change_in_price
round(answer*100,2)
|
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| null |
You own a bond with a modified duration of 10.5 and a convexity of -125. You are expecting an instantaneous increase in yields of 25 bp. What percentage change in value would you expect for your bond?
| -2.66 |
modified_duration = 10.5
convexity = -125
change_in_yield = 25 / 10000
change_in_price = -modified_duration * change_in_yield + .5 * convexity * change_in_yield ** 2
answer = change_in_price
round(answer*100,2)
|
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| null |
You are assessing a firm's Weighted-Average-Cost-of-Capital (WACC). From comparables, you estimate the cost of equity to be 5%. The firm recently issued bonds that yield 3.2%. The current market cap of the firm is 100mm and the amount of debt outstanding is 25mm. Its marginal tax rate is 20%. What is the WACC in percentage terms?
| 4.51 |
debt = 25
market_cap = 100
enterprise_value = debt + market_cap
cost_of_equity = .05
cost_of_debt = .032
tax_rate = .20
wacc = (market_cap / enterprise_value * cost_of_equity) + (debt / enterprise_value * cost_of_debt * (1 - tax_rate))
answer = wacc
round(answer*100,2)
|
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| null |
A stock is currently trading at $700 and you decide to enter into a strangle, selling a call and a put option. A $720 strike call is currently prices at $27.00 and a $680 strike put is trading for $19. On the day of expiration the share price is trading at $655, what is your net profit (or loss)?
| 2,100 |
strike = 680
cost_call = 27*100
cost_put = 19*100
total_loss = (680 - 655) * 100
answer = cost_call + cost_put - total_loss
answer
|
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| null |
You are assessing a firm's financial statements. It has 20mm shares outstanding and the current market price is $10.
Additionally, the firm carries $50mm of short-term debt, $250mm of long-term debt, and $10mm of cash on its balance sheet.
Its most recent 12 months produced $42.5mm of EBITDA. What EBITDA multiple does the firm have?
| 11.53 |
shares_outstanding = 20
stock_price = 10
short_term_debt = 50
long_term_debt = 250
cash = 10
ebitda = 42.5
enterprise_value = shares_outstanding * stock_price + short_term_debt + long_term_debt - cash
multiple = enterprise_value / ebitda
answer = multiple
round(answer,2)
|
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| null |
You have entered a covered called position on stock ABC.
You purchase 100 shares at the current market price, $65.
Simulatneously, you sell one contract 10% out of the money and collect $3.25 per share.
In one month, ABC stock jumps to $72.18. What is your profit/loss?
| 975 |
stock_price = 65
num_shares = 100
portfolio_basis = stock_price * num_shares
moneyness = .1
option_premium = 3.25 * 1 * 100 # Each contract is for 100 shares
option_strike = stock_price * (1 + moneyness)
next_month_price = 72.18
portfolio_value = next_month_price * num_shares - max(0, next_month_price - option_strike) * 100 + option_premium
answer = portfolio_value - portfolio_basis
answer
|
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| null |
You have entered a covered called position on stock ABC.
You purchase 100 shares at the current market price, $65.
Simulatneously, you sell one contract expiring in one month that is 10% out of the money and collect $3.25 per share.
In one month, ABC stock falls to $50. What is your profit/loss?
| -1,175 |
stock_price = 65
num_shares = 100
portfolio_basis = stock_price * num_shares
moneyness = .1
option_premium = 3.25 * 1 * 100 # Each contract is for 100 shares
option_strike = stock_price * (1 + moneyness)
next_month_price = 50
portfolio_value = next_month_price * num_shares - max(0, next_month_price - option_strike) * 100 + option_premium
answer = portfolio_value - portfolio_basis
answer
|
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| null |
You have entered a protective put position on stock XYZ.
You purchase 200 shares at the current market price $1245.
Simultaneously, you purchase two contracts 3% out of the money, paying $17 per share. The options expire in one month.
In one month, XYZ stock falls 4.8%. What is your profit/loss?
| -10,870 |
stock_price = 1245
num_shares = 200
portfolio_basis = stock_price * num_shares
moneyness = -.03 # Out of the Money put options are below the current stock price
option_premium = 17 * 2 * 100
option_strike = stock_price * (1 + moneyness)
change_in_price_pct = -0.048
next_month_price = stock_price * (1 + change_in_price_pct)
portfolio_value = next_month_price * num_shares + max(0, option_strike - next_month_price) * 2 * 100 - option_premium
answer = portfolio_value - portfolio_basis
round(answer)
|
fincode
| null |
You have entered a protective put position on stock XYZ.
You purchase 200 shares at the current market price $1245.
Simultaneously, you purchase two contracts 3% out of the money, paying $17 per share. The options expire in one month.
In one month, XYZ stock jumps 2.2%. What is your profit/loss?
| 2,078 |
stock_price = 1245
num_shares = 200
portfolio_basis = stock_price * num_shares
moneyness = -.03 # Out of the Money put options are below the current stock price
option_premium = 17 * 2 * 100
option_strike = stock_price * (1 + moneyness)
change_in_price_pct = .022
next_month_price = stock_price * (1 + change_in_price_pct)
portfolio_value = next_month_price * num_shares + max(0, option_strike - next_month_price) * 2 * 100 - option_premium
answer = portfolio_value - portfolio_basis
round(answer)
|
fincode
| null |
You have entered a bull call spread position on the equity index MOON that is currently trading at $247.50.
Simultaneously, you pay $4 per share for one contract of call options that are 4% OTM while selling one contract for $1.12 per share that is 10% OTM.
Next month at the expiration of your options, MOON increases by 6.5%. What is your profit/loss?
| 331 |
stock_price = 247.5
lower_moneyness = .04
higher_moneyness = .1
lower_strike = stock_price * (1 + lower_moneyness)
higher_strike = stock_price * (1 + higher_moneyness)
lower_premium = -4 * 100
higher_premium = 1.12 * 100
change_in_price_pct = 0.065
next_month_price = stock_price * (1 + change_in_price_pct)
profit_or_loss = max(0, next_month_price - lower_strike) * 100 - max(0, next_month_price - higher_strike) * 100 + lower_premium + higher_premium
answer = profit_or_loss
round(answer)
|
fincode
| null |
You have entered a bull put spread position on the equity index FALL that is currently trading at $1000 per share.
Simulataneously, you sell one contract of put options that are 4% OTM for $25 a share while buying one contract of put options that are 10% OTM for $5 a share.
Next month, the price of FALL decreases by 4.25%.
What is your profit/loss at expiation?
| 1,750 |
stock_price = 1000
lower_moneyness = -0.10
higher_moneyness = -0.04
lower_strike = stock_price * (1 + lower_moneyness)
higher_strike = stock_price * (1 + higher_moneyness)
lower_premium = -5 * 100
higher_premium = 25 * 100
change_in_price_pct = -0.0425
next_month_price = stock_price * (1 + change_in_price_pct)
profit_or_loss = -max(0, higher_strike - next_month_price) * 100 + max(0, lower_strike - next_month_price) * 100 + higher_premium + lower_premium
answer = profit_or_loss
round(answer)
|
fincode
| null |
You are reviewing your portfolio's performance over the last year and you find that you had a return of 8% with a standard deviation of 12%. The risk free rate was 4%. What is your Sharpe Ratio?
| 0.33 |
portfolio_return = .08
portfolio_std_dev = .12
risk_free_rate = .04
sharpe_ratio = (portfolio_return - risk_free_rate) / portfolio_std_dev
answer = sharpe_ratio
round(answer , 2)
|
fincode
| null |
Today, there was an acquistion annoucement.
The company ACQUIRING INC agreed to purchased BUY-ME CORP for $25 a share with an estimated close date 6 months from now.
Immediately upon the news, the price of BUY-ME CORP jumped from $20 to $24.10.
What is the market's implied probability of the acquisition going through? A zero-coupon treasury bill maturing on the expected day of the transaction has a current yield of 3%.
If the transaction does not close, analysts expect BUY-ME CORP to return to fall to $10.
| 0.96 |
import numpy as np
initial_price = 20
new_price = 24.10
closing_price = 25
failing_price = 10
risk_free_rate = .03
time_to_close = 0.5
outcomes = np.array([[closing_price / (1 + risk_free_rate) ** time_to_close, failing_price / (1 + risk_free_rate) ** time_to_close], [1, 1]])
constraints = np.array([new_price, 1])
probabilities = np.linalg.solve(outcomes, constraints)
round(probabilities[0],2)
|
fincode
| null |
Given the following predicted cash flows over the coming years, calculate the present value of each positive cash flow and sum them. Assume the current year is 2023, a CAPM rate of 7% and round to two significant figures
| Year | FCF ($) |
| :--- | :--- |
| 2024 | 58 |
| 2025 | (12) |
| 2026 | 20 |
| 2027 | (40) |
| 2028 | 70 |
| 120.44 |
values = [58, -12, 20, -40, 70]
sum = 0
toAdd = 0
CAPM = 0.07
for index, element in enumerate(values):
if element > 0:
toAdd = element*(1/(1+CAPM)**(index+1))
sum += toAdd # Accumulate the sum of positive elements
round(sum,2)
|
fincode
| null |
Given the following predicted free cash flows over the coming years, calculate the terminal value of the free cash flow using the perpetual method. Assume the current year is 2023, a CAPM rate of 7%, a terminal growth rate of 3% and round to two significant figures.
| Year | FCF ($) |
| :--- | :--- |
| 2024 | 58 |
| 2025 | (12) |
| 2026 | 20 |
| 2027 | (40) |
| 2028 | 70 |
| 1,802.5 |
values = [58, -12, 20, -40, 70]
CAPM = 0.07
terminal_rate = 0.03
terminal_value = 0
last_fcf = values[-1]
terminal_value = last_fcf * (1 + terminal_rate) / (CAPM - terminal_rate)
round(terminal_value, 2)
|
fincode
| null |
What was the percentage change in Earnings before interest and taxes EBIT in 2018/2019 from 2017/2018?
| 16.13 | null |
codetatqa
|
{"Earnings before interest and taxes EBIT": {"2017/2018": 713, "2018/2019": 828}, "Earnings share of non-operating companies recognised at equity": {"2017/2018": 0, "2018/2019": 0}, "Other investment result": {"2017/2018": 0, "2018/2019": 1}, "Interest income/expenses (interest result)": {"2017/2018": 136, "2018/2019": 119}, "Other financial result": {"2017/2018": 2, "2018/2019": 1}, "Net financial result": {"2017/2018": 137, "2018/2019": 119}, "Earnings before taxes EBT": {"2017/2018": 576, "2018/2019": 709}, "Income taxes": {"2017/2018": 216, "2018/2019": 298}, "Profit or loss for the period from continuing operations": {"2017/2018": 359, "2018/2019": 411}, "Profit or loss for the period from discontinued operations after taxes": {"2017/2018": 22, "2018/2019": 526}, "Profit or loss for the period": {"2017/2018": 337, "2018/2019": 115}}
|
What is the percentage change in the current provision for income taxes at the state level between 2018 and 2019?
| 11.36 | null |
codetatqa
|
{"Current provision for income taxes: -- State": {"2019": 49, "2018": 44, "2017": 48}, "Current provision for income taxes: -- Foreign": {"2019": 1716, "2018": 953, "2017": 1023}, "Current provision for income taxes: -- Total current": {"2019": 1765, "2018": 997, "2017": 1071}, "Deferred tax expense (benefit): -- Federal": {"2019": 3, "2018": -13, "2017": 26}, "Deferred tax expense (benefit): -- Foreign": {"2019": -361, "2018": 98, "2017": 109}, "Deferred tax expense (benefit): -- Total deferred": {"2019": -358, "2018": 85, "2017": 135}, "Deferred tax expense (benefit): -- Provision for income taxes": {"2019": 1407, "2018": 1082, "2017": 1206}}
|
What was the change in Earnings before interest and taxes EBIT in 2018/2019 from 2017/2018 in millions?
| 115 | null |
codetatqa
|
{"Earnings before interest and taxes EBIT": {"2017/2018": 713, "2018/2019": 828}, "Earnings share of non-operating companies recognised at equity": {"2017/2018": 0, "2018/2019": 0}, "Other investment result": {"2017/2018": 0, "2018/2019": 1}, "Interest income/expenses (interest result)": {"2017/2018": 136, "2018/2019": 119}, "Other financial result": {"2017/2018": 2, "2018/2019": 1}, "Net financial result": {"2017/2018": 137, "2018/2019": 119}, "Earnings before taxes EBT": {"2017/2018": 576, "2018/2019": 709}, "Income taxes": {"2017/2018": 216, "2018/2019": 298}, "Profit or loss for the period from continuing operations": {"2017/2018": 359, "2018/2019": 411}, "Profit or loss for the period from discontinued operations after taxes": {"2017/2018": 22, "2018/2019": 526}, "Profit or loss for the period": {"2017/2018": 337, "2018/2019": 115}}
|
What is the proportion (in percentage) of the sum of Grocery & Snacks and Refrigerated & Frozen’s net sales over total net sales in fiscal year 2018?
| 76.09 | null |
codetatqa
|
{"($ in millions) -- Reporting Segment": {"Fiscal 2019 Net Sales": 2019.0, "Fiscal 2018 Net Sales": 2018, "% Inc (Dec)": "% Inc (Dec)"}, "($ in millions) -- Grocery & Snacks .": {"Fiscal 2019 Net Sales": 3279.2, "Fiscal 2018 Net Sales": 3287.0, "% Inc (Dec)": "\u2014%"}, "($ in millions) -- Refrigerated & Frozen": {"Fiscal 2019 Net Sales": 2804.0, "Fiscal 2018 Net Sales": 2753.0, "% Inc (Dec)": 2.0}, "($ in millions) -- International": {"Fiscal 2019 Net Sales": 793.4, "Fiscal 2018 Net Sales": 843.5, "% Inc (Dec)": -6.0}, "($ in millions) -- Foodservice": {"Fiscal 2019 Net Sales": 934.2, "Fiscal 2018 Net Sales": 1054.8, "% Inc (Dec)": -11.0}, "($ in millions) -- Pinnacle Foods": {"Fiscal 2019 Net Sales": 1727.6, "Fiscal 2018 Net Sales": "\u2014", "% Inc (Dec)": 100}, "($ in millions) -- Total": {"Fiscal 2019 Net Sales": 9538.4, "Fiscal 2018 Net Sales": 7938.3, "% Inc (Dec)": 20.0}}
|
What was the percentage change in the amount for Appliances in 2019 from 2018?
| -12.14 | null |
codetatqa
|
{"Transportation Solutions: -- Automotive": {"2019": 5686, "2018": 6092, "2017": 5228}, "Transportation Solutions: -- Commercial transportation": {"2019": 1221, "2018": 1280, "2017": 997}, "Transportation Solutions: -- Sensors": {"2019": 914, "2018": 918, "2017": 814}, "Transportation Solutions: -- Total Transportation Solutions": {"2019": 7821, "2018": 8290, "2017": 7039}, "Industrial Solutions: -- Industrial equipment": {"2019": 1949, "2018": 1987, "2017": 1747}, "Industrial Solutions: -- Aerospace, defense, oil, and gas": {"2019": 1306, "2018": 1157, "2017": 1075}, "Industrial Solutions: -- Energy": {"2019": 699, "2018": 712, "2017": 685}, "Industrial Solutions: -- Total Industrial Solutions": {"2019": 3954, "2018": 3856, "2017": 3507}, "Communications Solutions: -- Data and devices": {"2019": 993, "2018": 1068, "2017": 963}, "Communications Solutions: -- Appliances": {"2019": 680, "2018": 774, "2017": 676}, "Communications Solutions: -- Total Communications Solutions": {"2019": 1673, "2018": 1842, "2017": 1639}, "Communications Solutions: -- Total": {"2019": 13448, "2018": 13988, "2017": 12185}}
|
What is the percentage change in the valuation allowance from 2018 to 2019?
| 25.1 | null |
codetatqa
|
{"": {"2019": "U.S. $ in thousands", "2018": ""}, "Operating loss carryforward": {"2019": 73260, "2018": 57768}, "Net deferred tax asset before valuation allowance": {"2019": 19911, "2018": 15916}, "Valuation allowance": {"2019": -19911, "2018": -15916}, "Net deferred tax asset": {"2019": 795, "2018": 772}}
|
What was the increase / (decrease) in the cost from 2018 to 2019?
| 18 | null |
codetatqa
|
{"($ in millions) -- For the year ended December 31:": {"2019": 2019, "2018": 2018, "2017": 2017}, "($ in millions) -- Cost": {"2019": 100, "2018": 82, "2017": 91}, "($ in millions) -- Selling, general and administrative": {"2019": 453, "2018": 361, "2017": 384}, "($ in millions) -- Research, development and engineering": {"2019": 126, "2018": 67, "2017": 59}, "($ in millions) -- Pre-tax stock-based compensation cost": {"2019": 679, "2018": 510, "2017": 534}, "($ in millions) -- Income tax benefits": {"2019": -155, "2018": -116, "2017": -131}, "($ in millions) -- Net stock-based compensation cost": {"2019": 524, "2018": 393, "2017": 403}}
|
What was the percentage change in Total (loan) in 2019 from 2018?
| -6.38 | null |
codetatqa
|
{"Vessel values including newbuildings (broker values)": {"2019": 1801.5, "2018": 1675.1, "2017": 1661.1}, "Total (value)": {"2019": 1801.5, "2018": 1675.1, "2017": 1661.1}, "Borrowings": {"2019": 863.4, "2018": 754.7, "2017": 753.9}, "- Hereof debt regarding Land and buildings & Other plant and operating equipment": {"2019": -8.7, "2018": "-", "2017": "-"}, "Committed CAPEX on newbuildings": {"2019": 51.2, "2018": 258.0, "2017": 306.9}, "Loans receivables": {"2019": -4.6, "2018": "-", "2017": "-"}, "Cash and cash equivalents, including restricted cash": {"2019": -72.5, "2018": -127.4, "2017": -134.2}, "Total (loan)": {"2019": 828.8, "2018": 885.3, "2017": 926.6}, "Loan-to-value (LTV) ratio": {"2019": 46.0, "2018": 52.9, "2017": 55.8}}
|
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