Finance Answers

BIT Bank (in millions) Assets Liabilities Reserves $48 Deposits $340 Loans $360 Bank Capital $68 NAT Bank (in millions) Assets Liabilities Reserves $48 Deposits $400 Loans $360 Bank Capital $8 Assume that both BIT Bank and NAT Bank have the same net profit after tax of $8 million. a. Calculate for each bank, BIT Bank and NAT Bank, its: i. return on assets (ROA); ii. return on equity (ROE); and iii. leverage ratio. Show all your calculations. b. With reference to your answers in (a), which Bank (Bank BIT or Bank NAT) is more attractive for shareholders? Show your calculations to explain your answers. c. Which bank (Bank BIT or Bank NAT) is riskier in case of loan depreciation at $60 million? Explain. Show your calculations to explain your answers.

BIT Bank (in millions)
Assets Liabilities
Reserves $48 Deposits $340
Loans $360 Bank Capital $68

NAT Bank (in millions)
Assets Liabilities
Reserves $48 Deposits $400
Loans $360 Bank Capital $8

Assume that both BIT Bank and NAT Bank have the same net profit after tax of $8 million.

a. Calculate for each bank, BIT Bank and NAT Bank, its: i. return on assets (ROA); ii. return on equity (ROE); and iii. leverage ratio. Show all your calculations.

b. With reference to your answers in (a), which Bank (Bank BIT or Bank NAT) is more attractive for shareholders? Show your calculations to explain your answers.

c. Which bank (Bank BIT or Bank NAT) is riskier in case of loan depreciation at $60 million? Explain. Show your calculations to explain your answers.

what would happen if consumers did not have easy access to information about products and servises ?

The owner of D. Donuts Ltd. wants to buy a new machine for his bakery. He is looking at two possible machines, Machine A and Machine B. On the one hand, Machine A will initially cost $ 100, its operating cost will be $ 10 per year and is expected to last 2 years. On the other hand, Machine B will cost $ 140 with an operating cost of $ 8 per year, and will run out after 3 years. Both machines will be amortized at an ACC rate of 25%. If the ERR is 10% and the tax rate is 42%, which machine should the owner buy?

1-Company XYZ plans to acquire a new automated welding system to replace the existing manual system. This new system will initially cost $ 600,000 and will be amortized at an ACC rate of 30%. The expected life of the system is 4 years, and the company estimates it will be worth $ 100,000 at the end of this period. Since the new automated system will be more efficient than the old one, the company can expect to achieve a cost savings of $ 180,000 per year before tax during the period. If the ERR is 15% and the tax rate is 44%, what is the net present value of the new system?

Chilli farming

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n 2001, Larry creates a trust with Ted as trustee. Ted (as trustee) may distribute income and principal to Susie, Jeff and Leon at his discretion to provide for their health, education, maintenance, and support. Upon Larry's death, the trust terminates and the remainder is distributed to Susie, Jeff and Leon in equal shares. In 2012, Larry dies. In 2012, the trust has $15,000 of interest and $15,000 of dividends. Additionally, the trust received $115,000 for the sale of an asset with a basis of $100,000. How much income does each of Jeff, Susie, Leon and the trust report for 2012 and why?