Business, 01.09.2020 21:01 Kimbeeeerly4569

You are an industry analyst for the telecom sector. You are analyzing financial reports from two companies: BlastTel Inc. and SaneTel Corp. Corporate tax for both firms is 35%. Your associate analyst has calculated and compiled, in the following table, a list of important figures you need for the analysis:. Data Collected
BlastTel Inc. SaneTel corp.
EBIT $260,100 $107,100
Depreciation $91,035 $37,485
Total operating capital $1,101,600 $457,470
Net investment in operating capital $459,000 $198,900
WACC 12.28% 17.35%
In your analysis, you want to look for several characteristics-one of them being the return on invested capital (ROIC). Using the information available, complete the following statements:.
• The net operating profit after tax (NOPAT) for BlastTel Inc. is , whereas the NOPAT for SaneTel Corp. is
• BlastTel Inc. has a free cash flow of , whereas, Sane Tel Corp. has a free cash flow of
• BlastTel Inc. has a return on invested capital than SaneTel Corp. has.
Your inference from the analysis is that both firms are in a high-growth phase, and their growth will be profitable. Considering your analysis, which of the following statements is true?
A. If a company has negative NOPAT but a positive free cash flow, then the firm could be in a high-growth phase and making investments in operating capital to support growth.
B. If a company has positive NOPAT but a negative free cash flow, then the firm could be in a high-growth phase and making investments in operating capital to support growth.

Answers: 1

Show answers

Another question on Business

Business, 22.06.2019 01:30

The gomez company, a merchandising firm, has budgeted its activity for december according to the following information: • sales at $500,000, all for cash. • merchandise inventory on november 30 was $250,000. • the cash balance at december 1 was $20,000. • selling and administrative expenses are budgeted at $50,000 for december and are paid for in cash. • budgeted depreciation for december is $30,000. • the planned merchandise inventory on december 31 is $260,000. • the cost of goods sold represents 75% of the selling price. • all purchases are paid for in cash. the budgeted cash disbursements for december are:

Answers: 3

Answer

Business, 22.06.2019 12:30

Consider a treasury bill with a rate of return of 5% and the following risky securities: security a: e(r) = .15; variance = .0400 security b: e(r) = .10; variance = .0225 security c: e(r) = .12; variance = .1000 security d: e(r) = .13; variance = .0625 the investor must develop a complete portfolio by combining the risk-free asset with one of the securities mentioned above. the security the investor should choose as part of her complete portfolio to achieve the best cal would be a. security a b. security b c. security c d. security d

Answers: 3

Answer

Business, 22.06.2019 20:20

Fractional reserve banking which of the following statements about fractional reserve banking are correct? check all that apply. fractional reserve banking allows banks to create money through the lending process. fractional reserve banking does not allow banks to hold excess reserves. fractional reserve banking allows banks to create additional wealth by lending some reserves. fractional reserve banking relies on everyone not withdrawing their money at the same time.

Answers: 2

Answer

Business, 22.06.2019 20:30

You are in the market for a new refrigerator for your company’s lounge, and you have narrowed the search down to two models. the energy efficient model sells for $700 and will save you $45 at the end of each of the next five years in electricity costs. the standard model has features similar to the energy efficient model but provides no future saving in electricity costs. it is priced at only $500. assuming your opportunity cost of funds is 6 percent, which refrigerator should you purchase

Answers: 3

Answer

You know the right answer?

You are an industry analyst for the telecom sector. You are analyzing financial reports from two com...

Questions