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The key to a project financing is to finance a project with as little recourse to the sponsor as possible. Explain why.
For most large projects there are different lenders or groups of lenders during different risk phases. Explain why.
What are some of the ways that a project financing can be used to improve the return on the capital invested in a project?
Enron is a perfect example of why project financing and special purpose vehicles should not be used by reputable firms.
How does the process of selecting projects on the basis of net present values, as done in capital budgeting, relate to a firm's strategy? Explain.
Consider a discount retail store chain. List the factors that influence future sales for the chain.
What are the advantages and disadvantages of using the percent-of sales method in constructing pro forma financial statements?
Why is it important for a firm to analyze its comparative and competitive advantages in assessing its strategy?
Why in measuring earnings surprise is the difference between actual and consensus earnings deflated?
What is the difference between how earnings per share numbers are reported before and after 1998?
What are the issues related to using analysts' forecasted earnings per share?
What has been the evidence on the ability of analysts to forecast earnings?
In 1997, Drexel Corporation had a current ratio of 3.0 and a quick ratio of 1.5. If net working capital is $2 million, what is the amount of Drexel's 1997.
Explain the trend in return on assets using the trends in net profit margin and asset turnover.
What is the difference between earnings before interest and taxes and earnings available to common stockholders?
Calculate the depreciation for each year in the case of the purchase of this machine.
Explain why the cost of a true lease depends on the size of the transaction and whether the lease is tax-oriented or non-tax-oriented.
Why do chief financial officers generally prefer that lease agreements be structured as an operating lease for financial accounting purposes?
Critically evaluate the claim that by leasing, a corporation can avoid the risk of obsolescence of equipment and the risk of disposal of the equipment.
If a lease for equipment that has a 15-year expected economic life has a lease term of two years, how will the lease be treated for financial reporting purposes
Assume that the lease is a net lease, that any tax benefits are realized in the year of the expense, and that there is no investment tax credit.
Calculate the direct cash flows from leasing initially and for each of the five years.
Why do lenders in a project financing look very closely at the project's expected cash flows?
Identify and explain which of the employee's constitutional rights were violated during the interview.