F3 Exam Dumps : Financial Strategy

A company's main objective is to achieve an average growth in dividends of 10% a year. 

In the most recent financial year:

Sales are expected to grow at 8% a year over the next 5 years. 

Costs are expected to grow at 5% a year over the next 5 years. 

What is the minimum dividend payout ratio in 5 years' time that would allow the company to achieve its objective?

B, a European based modern art dealer, frequently imports and sells single high value items created in the United States. The price is fixed at the date of sale but the items are commissioned and made to order with a lead time of three to nine months depending on the individual specification

B holds payment for his customers from the point of purchase and passes funds when the items are shipped However, despite putting the money on short term deposit, there have been times when B's profits have been almost entirely eroded by adverse movements m interest rates Advise B by matching the appropriate instrument to B's requirements.

Company Z has identified four potential acquisition targets: companies A, B, C and D.

Company Z has a current equity market value of $590 million.

The price it would have to pay for the equity of each company is as follows:

Only one of the target companies can be acquired and the consideration will be paid in cash.

The following estimations of the new combined value of Company Z have been prepared for each acquisition before deduction of the cash consideration:

Ignoring any premium paid on acquisition, which acquisition should the directors pursue?