Corporate finance - WACC - Cash Flow - Measuring Return on Investment Assignment

Corporate finance - WACC - Cash Flow - Measuring Return on Investment - discounted cash flow techniques - Financing Decisions - - Assignment Example Accounting earnings are obtained from the income statements prepared in accordance with the applicable accounting standards and frameworks, whereas cash flows are determined as the cash inflows and outflows generated from a certain project. There are some major factors, which constitute the differences between the accounting earnings and cash flows, such as: 1. Operating and Capital Expenditures Operating expenditures are considered as those expenses, which are directly linked with the revenues such as direct material, direct labor, overheads etc. Conversely, capital expenditures are those expenditures, which are incurred by the firm in order to develop the business infrastructure, e.g. purchasing a building, land, equipment etc. Under accounting earnings, operating expenditures are included in arriving at the final net income figure. However, capital expenditures are spread over the useful lives of those assets and then systematically depreciated. Under cash flow estimations, both o perating and capital expenditures are included in order to analyze the overall viability of the project. In short, the mainstream difference between the accounting earnings and cash flows is the exclusion of capital expenditures from the accounting earnings but its inclusion in cash flows. 2. ... However, due to low taxable income, the amount of tax is reduced substantially, which is in fact cash based expenditure. Under cash flow approach, depreciation, amortization and other non-cash expenses are not included, but the tax savings due to such non-cash expenses are included which lead to better cash flows. In short, non-cash expenses in deriving accounting earnings but they are excluded in cash flow approach. However, tax benefits are included as cash inflow in cash flow based approach. 3. Accrual versus Cash conventions Accounting earnings are purely established because of the relevant accounting standards and frameworks, such as GAAP and IFRS. These standards require the firms to draft their financial statements by utilizing accrual basis of accounting. Accrual basis of accounting states that, expenditure should be recognized in the financial statements in the period in which it is incurred, not in the period in which it is paid. Similarly, revenue is recognized in the fina ncial statements in the period in which it is earned, not in the period in which it is received. On the other hand, cash flow approach works on the principle of cash inflows and outflows in the periods in which they are received and paid. Therefore, the major difference between accounting earnings and cash flows is the accrual versus cash based conventions, which lead to material differences between the amounts of returns obtained under both approaches. B. INCREMENTAL VERSUS TOTAL CASH FLOWS In order to analyze the return on investment, another important way to analyze is to look whether the whole firm is benefitted from that piece of investment or not. Obviously, a firm is benefitted from the cash

Swimming pool policy evaluation Essay Example | Topics and Well Written Essays - 1000 words

Swimming pool policy evaluation - Essay Example The regulation states that I am sure that the other users of the facility will agree with me when I say that shutting down the facilities for 15 minutes 4 times a day takes away from the enjoyment that we expect to get when we come to the pool. In fact, the facilities are closed up to 6 times a day, depending upon the number of babies and children present at the pool on that day. This is not to say that we do not appreciate the concern of management towards the health safety of the pool users. It is after all, a well known fact that water borne illnesses are most often transferred through ingested pool water. With the prevalence of cryptosporidosis, the water borne diarrhea in most swimming water facilities, one can never be too cautious. Our community would of course, hate to see the facility shut down together with the other 12.1% of pools that the Center for Disease Control (CDC) shut down for health safety violations ( Spivey, 2). Closing the pool 4 times a day for cleaning is obviously part of the zeal and protectiveness that the pool administrators feel for the bathers. However, closing the pool 4 times a day to add chemicals and disinfectants to the water may not be the proper way to insure the cleanliness of the general pools. It may instead, be removing from the enjoyment of the swimmers and their family members. Even the Hyperchlorinization of the pool once a week does not improve the water enjoyment of the members. Instead, it poses a different kind of water borne health threat due to the Chloramine levels in the pool which cause mild to severe eye and respiratory inflammation among those exposed to it. As concerned members of this facility, we would like to suggest that certain changes be undertaken be in the cleaning policy in order to add instead of hinder the water enjoyment of the bathers. We would like

Business Research Terms and Concepts Essay Example for Free

Business Research Terms and Concepts Essay Understanding Business Research Terms and Concepts: Part 3 A. Determine which level of measurement— nominal, ordinal, interval, or ratio—is used in the following examples. 1. The Association of Accountants is conducting a survey to determine the ranking of the top 100 accounting firms in the world. Ordinal 2. How many years did it take you to earn your college degree? Ratio 3. On a questionnaire which asks for gender, males are coded as 1 and females are coded as 2. Nominal 4. Respondents are asked to rate a list of high-tech companies as excellent, good, fair, or poor in terms of their service delivery. Ordinal 5. Cereal brands are arranged in an ordered sequence in which an equal interval exists between each point. Interval 6. Jake Locker averages 350 yards per game passing. Interval 7. The length of time it takes the winner of a marathon to cross the finish line. Ratio 8. Students are asked to rank computer manufacturers. Ordinal 9. The brand of charge card used by a customer. Nominal B. Which sampling method—simple random, systematic, stratified, cluster, convenience, judgment, quota, or snowball—is most appropriate for the following examples? Explain why. 1. The unemployment rate is calculated each month by the U.S. Bureau of Labor Statistics. The survey consists of 50,000 households in about 2,000 counties and cities in all 50 states. Stratified. Because you are dividing into subgroups prior to sampling. 2. A researcher for Kraft Foods selects five states randomly, and then selects 10 supermarkets chains within each state to call for a phone survey as test markets for a new cookie. Cluster. You are dividing into groups or cluster then taking a random sample. 3. A new product researcher would like to investigate the use of virtual teams. After conducting an interview with a manager, she asks for the names of other managers that use virtual teams. Snowball. You are using a small pool of subjects and generating more from them. 4. A news reporter asks people on the street their opinion about the president’s new bill. Convenience. There are some members of the population that have no chance of being selected and you are using readily available subjects. 5. Jamie select Denver, Colorado; Chicago, Illinois; and San Diego, California as test markets for a potato chip line base on her experience with these markets. Judgment. Because Jamie has used his or her own judgment to select the appropriate sample. 6. A researcher instructs field interviewers to interview customers of different cell phone companies in a nearby shopping mall so that they each interview 10 ATT, 8 T Mobile, 6 Verizon, and 4 owners of other cell phone providers. Quota. Because there is a set requirement of the sampling pool. 7. The Consumer Price Index represents a sampling of 90,000 items from 364 categories, chosen from 20,000 retail stores in 85 geographically distributed areas that are chosen to be as similar as possible. Stratified. Because you are dividing into subgroups prior to sampling. 8. A finance professor wants to know how many MBA students would be willing to take a course in international finance this summer. She surveys students in the class she is currently teaching. Cluster because she is dividing all MBA students into a group and sampling her class. It could also be seen as Convenience because she is sampling a group that is on hand and there is a set that doesn’t have a chance to be selected (anyone not in her class).

Industrialization And Environmental Challenge In China Environmental Sciences Essay

Industrialization And Environmental Challenge In China Environmental Sciences Essay China has experienced the worlds fastest economic development over the past decades. At the same time, it has faced environmental degradation, and growing barriers against development. Chinas most productive city Shanghai has taken a particularly major role in Chinas economic and political development. However, the city could not avoid confrontation with environmental challenges, especially water pollution. The rapid economic growth and industrialisation have generated high pressure on the citys environment. Although Shanghai is a coastal economic city with abundant water sources from various rivers such as Yangtze River and Changjiang River, the city has suffered from polluted water and water shortage. The first reason is water pollution. According to Shanghai Water Authority (Shanghai Municipal Oceanic Bureau, SWA), majority of surface water in the city has been polluted and the water quality does not meet the drinking water quality standards  [1]  . Also, only 2.3 per cent of the Huangpu River, Shanghais main water supplies, met the grade 1-2 of water quality and 23.0 per cent attained grade 3. The rest 73.8 per cent was rated as grade 4-5 (China Water Risk Report 2010). Second, Shanghais water infrastructure provides 56.1% of the total water supply to its industry sector, which includes power plants and coal-fired factories, 14.3% to agriculture, and 10.1% to 23 million residents of its greater municipality (UNEP, 2010)  [2]  . This research argues that the Shanghai government has made improvements to solve the water pollution problem, but these havent been sufficient to resolve the persistent water pollution in the city. The Shanghai authority insists that it is aware of the deterioration of the environment, and it has promoted more balanced patterns of development using concepts such as harmonious society and scientific development. For instance, the municipal government launched $586 billion economic stimulus package in late 2008, and it invested majorly in environment conservation projects, especially, water pollution projects. Also the government implemented the Plan of Underground Water Pollution Prevention and Control(2010-2011) which cost about %5.4 billion(IBIS, 2012)  [3]  . However, some research conducted by scholars such as Thomas Johnson (2009) and the Chinese Policy Research Center for Environment and Economy (2006) raised skepticism on the Shanghai governments environmental governance si nce there hasnt been a noticeable improvement. Also some empirical data show that the emissions of major water pollutants from the industrial sector is still considered serious, and the amount of wastewater discharged from the industrial and household sectors continues to increase. First, this research assumes that the Shanghai governments governance has been experiencing difficulties in controlling water pollution because of the weak legal instrument in restricting pollutants emission. In regard with water protection, the government has several legal measures such as Environmental impact assessment system(EIA), The Three Simultaneity System, Pollution levy system, Pollution discharge reporting system, Emission permit system, Total emission control system, Enforcement of pollution abatement for noncompliance, and Enforcement of shutting down, merging and transferring system(Xin, 2009). Nonetheless, the law enforcement and penalty imposition have not been effective in practice, which caused the failure in restricting pollutants emission. For example, the amount of three major pollutant emissions SO2, COD and soot has not been successfully decreased. In SO2s case, the amount of industrial emission even increased during 1990-2006 (Wen, 2007)  [4]  . Research Question 1. Does the Shanghai government have sufficient legal measures in restricting water pollutant emission? 2. If not, what are the causes of the problem? Second, the Shanghai government does not seem to be fully motivated to implement water protection policies. Since the state governments major concern is economic growth under the GDP-  based development  system, the municipal governments, including Shanghai, inevitably have been economic growth-oriented affected by the state governments regime. As indicated above, more than half of the water supplies in Shanghai have been allocated in the industry sector. Also, the environment department of the government has suffered from securing sufficient technical human resources because of its budget limit, which means the government has put its high priority to the industrialization and economic growth. Research Question 1. Has the water pollution issue been high on the Shanghai governments priorities? Third, this research presumes that the accessibility the accurate information and data and the inactive public participation have detracted from the Shanghai governments effectiveness in implementing the environmental governance. Although accurate information and its accessibility and active public participation could take a major role in the governments environmental governance, the rate of public participation is rather low and the accessibility of the accurate information is still limited in comparison with other developed countries. The public should be able to access the accurate information and data, and be involved in the monitoring and evaluation system. For example, NGOs could be a substitute for the expensive technical human resources. Research Question 1. Does the Shanghai government have the easy accessibility for the public to accurate environmental information and data? The Shanghai governments governance regarding water pollution issues has not been sufficient. Since the government is driven by the economic growth-oriented regime of the centre government, the law enforcement in restricting water pollutant emissions have been ineffective despite several legal measures. Also the public does not have easy accessibility of the accurate information and data. These three factors have not successfully improved the water quality in Shanghai, which will cause a serious water shortage. The water shortage will have repercussion for the whole country. It will directly affect the citizens well being and hinder China from sustainable development.

Franz Kafkas Use of Humor Essay -- Biography Biographies Essays

Franz Kafka's Use of Humor Franz Kafka, born on July 3, 1883 in Bohemia, in the city of Prague, has been recognized as one of the greatest writers of the twentieth century. His works have been called "cloudy, mysterious, inexplicable" (Oates ix). Most people hear the term Kafkan or Kafkaesque and think of dark, fantastic tales with almost no basis in our known reality. But what of Kafka's sense of humor? I personally laughed out loud several times while reading Kafka's Amerika. Were these snippets of humor part of Kafka's plan or mere accidents? According to Roy Pascal, author of Kafka's Narrators: A Study of His Stories and Sketches, "There is a good deal of humour in these early stories, as in the novels and later stories, but it is often ambiguous and can be overlooked" (Pascal 40). The humor that Pascal refers to is not the usual vaudeville, slap- stick so common in today's society. "Kafka never laughed so much as he did with [Felix] Weltsch, and it was Weltsch who first stressed the role of humor in Kafka's work - gallows humor spiked with desperation, but liberating for them both (Pawel 131). Kafka was a man who was more subtle than most and preferred his humor in a more deliberate vein. Irony was a flavor that seemed to work better for Kafka. By taking a look at some of Kafka's works we can see this irony more clearly. In Kafka's short story entitled, "The Judgement," written in 1912, we see one of the unusual uses of irony by Kafka. The central figure, Georg Bendemann, has just gotten into a long and somewhat heated argument with his aging and infirm father. Suddenly Georg's father "threw the blankets off with a strength that sent them all flying in a moment and sprang erect in bed. Only one hand touched the ... ...afka used humor, as shown here, he used it to further emphasize the horror of what was going on in his worlds. Works Cited Gray, Ronald. Franz Kafka. London: Cambridge University Press, 1975. 74-75. Janouch, Gustav. Conversations with Kafka. Trans. Goronwy Rees. New York: New Directions Publishing Corporation, 1971. 33. Kafka, Franz. The Complete Stories & Parables. Trans. Willa and Edwin Muir. New York: Quality Paperback Book Club, n.d. - - -, Amerika, Trans. Willa and Edwin Muir. New York, Schoken Books, 1974. Oates, Joyce Carol. Foreword to: The Complete Stories & Parables. Trans. Willa and Edwin Muir. New York: Quality Paperback Book Club, n.d. Pascal, Roy. Kafka's Narrators: A Study of His Stories and Sketches. Cambridge: Cambridge University Press, 1982. 189-230. Pawel, Ernst. The Nightmare of Reason. New York: Farrar, Straus, Giroux, 1984.

The Evolution of Human Skin Color Essay -- Human Evolution, 2015

According to Darwin and his theory on evolution, organisms are presented with nature’s challenge of environmental change. Those that possess the characteristics of adapting to such challenges are successful in leaving their genes behind and ensuring that their lineage will continue. It is natural selection, where nature can perform tiny to mass sporadic experiments on its organisms, and the results can be interesting from extinction to significant changes within a species. Human beings are no exception to biological evolution. Like other organisms around the world, humans have significantly changed overtime and have developed all sorts of diverse characteristics. One noticeable characteristic of human beings is the variation of skin color. Skin color has been used to identify, classify, and verify the variation that exists in the human population around the world. How did such a distinct variation arise and how did it play into adaptation? I’ve often heard that â€Å"humans came from monkeys,† or something similar. It is true that humans’ ancestors were primates, who first resided in warm and sunny Africa; they had similar features to today’s apes, such as a hairy body. The purpose of the vast amount of hair was to protect the body from the sun’s ultraviolet (UV) rays and to prevent overheating, mainly by acting as a barrier for the skin underneath the hair (Jablonski, 598). Some parts of the body such as palms were not covered with hair, but with sweat glands. Sweat glands allowed the body to cool off via evaporation at the surface of the skin; sweat glands were more efficient at thermoregulation. Overtime, early humans with a high amount of sweat glands were selected for since they had the best method at the time to keep themselves cool in warm environments (Kirchweger). This meant that overtime, humans lost most of their hair on their bodies, leaving their skin exposed. Sweat gland s were going to help the body to cool down, but they couldn’t protect the skin from harmful UV rays. This is where melanin worked its magic, and it’s the reason for the diversity in skin color today. Melanin helps reduce the absorption of wavelengths into the skin (Chaplin, Jablonski, 59). The more melanin in the skin, the greater the protection against harmful UV rays, and the amount of melanin in the skin correlates with the skin’s color (more melanin means darker skin).... ...m all over the world, with all hues of skin colors. With interracial dating and marriages and more â€Å"mixing† of skin colors, there are multiracial children with various skin colors. Genetically, it enhances variation within the individual, but what about variation within the species? I heard a joke once that eventually in the future, everyone will be beige. Will everyone mix together to an extent that there will be little to no variation anymore, at least skin deep? It’s an interesting concept to think of. At the moment, I believe that there is enough diversity within the human species that we don’t need to worry about the lack of variation in the near future. For now, we can appreciate the diversity of skin colors that has allowed our ancestors to adapt to their environments and survive. It has allowed them to create a lineage of who we are today. Works Cited: 1) Chaplin, G. Jablonski, N. â€Å"The Evolution of Human Skin Coloration.† Journal of Human Evolution 39 (2000) 57-106 2) Jablonski N. â€Å"The Evolution of Human Skin and Skin Color† Annual Reviews Anthropology 33 (2004) 585-623 3) Kirchweger G. â€Å"The Biology of†¦ Skin Color† Discover 22 (2001)

Business Plan Analysis – Private Concepts

Memorandum Re: Business Plan Assessment – Private Concepts Critically analyzing a business plan for its viability and opportunity for success is absolutely necessary from any stakeholder’s perspective. Doing so aides an investor in knowing whether or not to invest, a bank in deciding on a loan, or even a partner in his/her decision to join a venture.But perhaps most importantly, a critical analysis of a business plan can and will help the entrepreneur to assess whether or not an idea under its current platform is worth undertaking, or if it is back to the drawing board they go. The purpose of this memo is to assess the business plan of Private Concepts, a company hoping to bring to market The Pevlon, a cervical cancer screening device made for private, in-home use. The opportunity for such a device absolutely exists both here in the United States and abroad.For one, the plan mentions The Breast and Cervical Cancer Mortality Act of 1990 which, â€Å"mandated a nationwid e program to increase access of medically underserved women to comprehensive breast and cervical cancer screening services,† and when coupled with the Patient Protection and Affordable Care Act that was recently passed, the amount of free (to consumer; paid for by the government) access to this product creates potential for a high demand in this country.In foreign countries however, such as rural China and even Africa, where access to healthcare and proper healthcare facilities can be extremely rare, the appetite for this type of product could be tremendously significant. And there lies the first issue with this business plan. According to the Lancet Oncology medical journal, Volume 11, Issue 12, â€Å"75,000 women develop cervical cancer and 40,000 women die from the disease in China each year. † Those numbers in the United States are only about 12,000 and close to 4,000 respectively (cdc. ov). This exemplifies a larger need for this product abroad as opposed to right here in the states. And to focus on the opportunity in China, a Wall Street Journal publication explains how China’s healthcare system is lacking in general, but puts a microscope on the disparity in quality healthcare between rural and urban areas (Burkitt, 2012). These rural areas in China represent a large opportunity (much larger than any market in the United States) for The Pevlon.And so although the opportunity does exist for the business plan’s product, it is evident that the opportunity accentuated in the business plan is not the optimal one (aside from appealing to non-profits or other entities that would utilize the Pevlon in charitable, undoubtedly foreign ventures – this should have been a more significant portion of the plan). Additionally, the opportunity in the United States has not necessarily been proven to the point where one could consider the need for the product as pervasive enough to where the consumer is willing to pay for it.And pay for t hey would have to, because as the plan notes in the chart on page 10, a Pevlon screen costs 50% more than a typical pap smear. This exemplifies that pricing is going to be an issue. The health care market is highly dependent on the insurance industry, especially when there are product substitutes. Take pharmaceuticals for example. In group health care, policies are dictated by the contract that is in place and the majority of these contracts will sway the policy holder to utilize generic medications.This is done by the insurance carrier covering a larger percentage of generic medications than name brand ones, which ultimately costs the carrier less. So if a pap smear is less costly by 50% than a Pevlon test, carriers may still cover the device, but the â€Å"incentive† to utilize the cheaper procedure will absolutely be in place. Additionally, the business plan identifies lower income women as a target market, but fails to explain how a more expensive procedure will be a viab le option for this segment group. But even when the entire U. S. arket (via a sample size) is observed on page 19 of the plan, less than half of the women surveyed (46%) stated they would utilize the in-home Pevlon test even if most or all of it was covered by insurance. And if insurance reimbursement is removed completely, only 11. 2% of women would purchase the product. It would be interesting to see if there were follow up inquiries related to this line of questioning because a hypothesis is that some women, or maybe even a lot of women, may not trust themselves to complete such an important test at home.These women may simply prefer to rely on the expertise of a medical professional. And along these same lines, I feel as though the plan is silent on a very important aspect when it comes to assessing the true market of this product: how many women are in fact uncomfortable with going to a physician’s office to have a pap smear completed and would those women be more comfor table completing such a screen at home?Yes, there is a quote stating how uncomfortable the procedure is (which is in fact the first thing the reader sees underneath the Executive Summary heading), but it is somewhat suspect that this quote is anonymous and that there is no quantifiable evidence proving this notion to be true. So what is the actual desirability of this product? There really is no proof of it within the business plan and if I was investing in this product, I would need this â€Å"proof. † Aside from the ambiguous desirability of the product, there are a number of other concerns that should really stick out to the potential investor.On page 12 of the business plan there is a section that lays out the testing and approval stage for the Pevlon device. There are 6 steps in this section and only 1 of which have been completed, which happens to be the least significant of steps. The remaining rigmarole of securing FDA approval, obtaining the green light to conduct cl inical studies, actually conducting these studies, etc. could easily take upwards of a decade to complete. From the perspective of an investor or a bank assessing a loan, this is entirely too long a process for someone to simply START making their money back.This exemplifies how difficult a market healthcare can be to get into, and that the barriers involved are simply too high. Additionally, the Pevlon is not necessarily a onetime revenue generator, but it comes uncomfortably close. In 2009, the American College of Obstetricians and Gynecologists (ACOG) released new cancer screening guidelines. According to ACOG, women now need to begin screening at age 21 as opposed to 18, and women ages 21 to 30 only need to be screened once every two years; women 30 and older only once every 3 years (Cox, 2009).The final qualms that I have concerning this business plan is the window of opportunity associated with the product, and the amount of time it will take for Private Concepts to become a p rofitable company. There does not appear to be an actual window of opportunity as the business plan does not thoroughly prove the market segment. Anecdotally I polled a number of women in my life with whom I am comfortable bringing this subject up and all of them (4) took the opinion that their screenings are not a major source of stress or discomfort, but rather they have come to accept it as â€Å"part of the routine of life. And in regards to becoming a profit generating entity, right up front on page 3 of the business plan, it is shown in the chart that Private Concepts would not be in the black until 5 years of doing business. What’s most concerning is that 5 years is still merely a hypothesis and that the organization is seeking over three million dollars in funding basically right out of the gate. Conceptually, the idea of a self administered, in home cervical cancer screening is a good idea.It poses benefits such as convenience and avoiding uncomfortable screenings a t a physician’s office. Private Concepts missed the mark in their business plan however, in a number of ways. The market was identified too ambiguously and the plan did not clearly exemplify certain key aspects of said market such as how many women actually would prefer an in home screen versus one performed in a physician’s office. Where to market and focus sales efforts was clearly stated, however, the idea to sell first in the United States is not the best possible plan of action.Private Concepts should as the plan mentions, manufacture the product off shore in order to maximize profit margins, but at the same time the pricing point should be rethought considerably in order to capitalize on the more fruitful markets of places like rural China and Africa. Appealing to non-profits and government entities that might focus on these foreign demographics was a small piece of the business plan, but it should have been more of a focus.Finally, in this assessment I had the a dvantage of hind sight and context. This business plan won the Moot Corp competition in 2002 with what appeared to be a viable business plan at the time. This product has yet to come to market and I was unable to find anything stating that the Pevlon has been approved by the FDA. This does not necessarily hold any bearing on this analysis of the business plan; however, it does prove to a certain extent, a lot of the shortcomings that were found within this business plan.Academically and structurally the plan was very well done, however in practical application it is easy to see how and why the Pevlon is still an unknown product to virtually the entirety of the woman population in the United States. Arbyn, Marc. HPV-Based Cervical Cancer Screening in China. The Lancet Oncology. 2010;11(12):1112 – 1113. Burkitt, Laurie. Report: China’s Healthcare System Deeply Sick. The Wall Street Journal. http://blogs. wsj. com/chinarealtime/2012/08/29/report-chinas-health-care-system- deeply-sick. 9 August 2012. Date Accessed: 23 January 2013. Cervical Cancer Statistics. Centers for Disease Control and Prevention: Gynecologic Cancers. http://www. cdc. gov/cancer/cervical/statistics. 20 December 2012. Date Accessed: 23 January 2013. Cox, Lauren & Dr. Joshua Hundert. New Cervical Cancer Screening Guidelines: No More ‘Annual’ Pap Smears. ABC, Good Morning America. http://abcnews. go. com/GMA/OnCall/guidelines-ditch-annual-pap-smears/story? id=9131632. 20 November 2009. Date Accessed: 23 January 2013.