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Mac2602 Assignment 1 Semester 1 2023 ( Distinction)
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MAC 2602ASSIGNMENT 6 SEMESTER 1 2023
Use this document as a guide to learn, compare and reference
,Question 1
Correct
Mark 3.00 out of 3.00
Jooky Hiltons (Pty) Ltd. sells sports equipment. The credit terms they offer to customers are 1,5/10 net 30. Their debtors ageing schedule looksas
follows:
Jooky Hiltons
Balance of the Percentage of totalaccount balance
Number of days outstanding R %
0-10 256 200 25%
11-30 510 350 50%
31-60 132 302 13%
60 + 125 770 12%
1 024 622 100%
REQUIRED:
Indicate which percentage of Jooky Hiltons’ customers, that pay within the credit period granted to trade debtors, does not take up the discount
offered.
(a) 75%%
(b) 50%
(c) 25%
(d) 12%
Select one:
a. 75%
b. 25%
c. 12%
d. 50%
,Question 2
Correct
Mark 3.00 out of 3.00
The following information relates to Sibusiswe Limited. The company holds R2 000 (face value) debentures which are redeemable after six years at
face value. The annual interest payment on the debentures (coupon rate) is 12%. The current market return for similar debentures with alifespan of
six years is 11% (pretax). Assume that the current company tax rate is 28%.
REQUIRED:
Calculate the current market value of the debentures. [Set your calculator at four decimals and round your final answer to the nearest rand.
Slight rounding differences may occur - choose the alternative that is closest to your answer.]
(a) R2 285
(b) R2 000
(c) R2 085
(d) R3 440
Select one:
a. R3 440
b. R2 085
c. R2 000
d. R2 285
, Question 3
Correct
Mark 3.00 out of 3.00
Info-Masters Ltd. is funded by both equity and debt. See extract from their financial statements and other information below.
Instrument Book value [R’millions]
Long-term debt 100
Redeemable preference shares 50
Ordinary shares (R10 each) 150
-The ordinary shares are currently trading at R20 per share. The return on a fully diversified portfolio on the JSE is 15%.
-The preference shares (redeemable in 6 years) were issued with a dividend yield of 14%. Similar instruments are currently yielding 12% in the
open market.
-The long-term debt is in the form of 10% debentures, redeemable after 6 years. The current market yield on similar instruments, with a life ofsix
years, is 11%.
-The current risk-free rate is 10% and the beta of the company is estimated at 1,2.
- The current effective tax rate is 28%.
REQUIRED:
Calculate the total market value of the long-term debt of Info-Masters Ltd. [Set your calculator on four decimal places and round your final
answer to the nearest rand. If slight rounding differences occur - choose the alternative that is closest to your answer.]
(a) R11 158 705
(b) R90 909 091
(c) R6 928 167
(d) R95 769 462
Select one:
a. R90 909 091
b. R6 928 167
c. R11 158 705
d. R95 769 462
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