Citicorp Case Analysis
1. What is the difference between primary and secondary capital. How is relevant to this case?
Primary capital consists of common stock, perpetual preferred stock, surplus, undivided profits, mandatory convertible instruments (debt that must be convertible into stock or repaid with proceeds from the sale of equity), reserves from loan losses, and other capital reserves. These items are treated as permanent forms of capital because they are not subject to redemption or retirement.
Secondary capital consists of nonpermanent forms of equity, included limited-life, preferred stock and subordinated notes and debentures.
It is relevant this case because Glass-Steagall did not prevent commercial banks from engaging in securities activities overseas. By the mid 1980s, US commercial banks such as Chase Manhattan, Citicorp and JP Morgan had thriving overseas securities operations. Currencies were not securities under the Glass-Steagall Act, but since exchange rates were allowed to float in the early 1970s, they have entailed similar market risk. In 1933, futures markets were small and transacted primarily in agricultural products, so they were not included in the legal definition of securities. By the mid-1980s, US commercial banks were subject to primary capital requirements set by the SEC, OCC and FDIC while US securities firms were subject to the SEC's Uniform Net Capital Rule (UNCR).
When the therapist met the client at home for individual therapy, the client greeted the therapist and she was feeling happy as evidence by reporting that she did all of her weekly plan that she plan it last week such as; visiting her biological parents, playing sports, finishing her homework, and get the dancing party arrangement done by the end of the week. Client reported that her mood did not change during the week as she reported that she was happy all the week. Client reported that the low moment for this week was getting her homework done by the end of Sunday at night as she was happy and enjoyed her time during the weekend, but she felt overwhelmed at the end as she did not finish her homework. Client reported that she was the student
Loblaw's Shoppers Drug Mart bid escalates grocery war as well as the new competitor Amazon and Walmart. The purpose of the competition is increasing market shares. Loblaw to boost its presence in metropolitan areas and reply to increasing need for smaller stores that provide a wide range of merchandise and are easily accessible in densely populated metropolitan locations. The almost 100-year-old Loblaw chain is great at offering one-stop shopping in large-format stores.
In SIVMED’s case, based on the definition of WACC, all capital bases should be included in its WACC. These include its common stock, preferred stock, bonds and long-term borrowings. In addition to being able to compute for the costs of capital, the WACC also determines how much interest SIVMED has to pay for all its activities. The value of the firm’s stock, which we want to maximize, depends of the after-tax cash flow. Hence, after-tax values for WACC are also needed. Furthermore, cost of capital is used to determine the cost of each debt, stock or common equity. Being able to analyze these will be essential into deciding what and how new capital should be acquired. Hence, the present marginal costs are ideally more essential than historical costs.
In Tim Seibles' poem, The Case, he reviews the problematic situations of how white people are naturally born with an unfair privilege. Throughout the poem, he goes into detail about how colored people become uncomfortable when they realize that their skin color is different. Not only does it affect them in an everyday aspect, but also in emotional ways as well. He starts off with stating how white people are beautiful and continues on with how people enjoy their presence. Then he transitions into how people of color actually feel when they encounter a white person. After, he ends with the accusation of the white people in today's world that are still racist and hateful towards people of color.
What is the capital structure of the company: short-term portion of long-term debt, long-term debt, preferred stock (if any), and market value of common stock issued and outstanding?
Costco Wholesale Corporation was an uncommon type of retailers called wholesale clubs. These clubs differentiated themselves from other retailer by requiring annual membership purchase. Especially in case of Costco, their target market is wealthier clientele of small business owners and middle class shoppers. They are now known as a low cost or discount retailer where they sell products in bulk with limited brands and their own brand. The company is competing with stores like Wal-Mart, SAM’s, BJ’s, and Sears. The case begins with an individual shareholder, Margarita Torres, who first purchased shares in 1997 and who is trying to evaluate the operational performance of the business in order to make a decision rather or not purchase more shares
2. What is the difference between a'smart' and a What is an appropriate capital structure for MCI? 3. What is the difference between a'smart' and a How has MCI raised external funds in the past? How sensible have these decisions been? 4.
Finance Capital, the novel takes place in the International Settlement of Shanghai after WWI, during the 1920’s. Within the international settlement, a battle between the Chinese Communist Laborers, the European, the American, the Japanese, and the Chinese financial oligarchies rages for supremacy of Shanghai’s financial markets. The financial oligarchy, according to Lenin, is the major owner of capital. Koya was a Japanese born Shanghai resident and was a member of the Forestry Division of the Muramatsu Steamship Company, a company (zaibatsu) of Japan. His brother Takashige (Japanese) was a manager of a factory belonging to the Far East Cotton Mills.
The Dodd-Frank Wall Street Reform and Consumer Protection Act brought the most significant changes to financial regulation in the United States since the reform that followed the Great Depression. It made changes in the American financial regulatory environment that affect all federal financial regulatory agencies and almost every part of the nation’s financial services industry. Like Glass-Steagall, the legislation passed after the Great Depression, it sought to regulate the financial markets and make another economic crisis less likely. Banks were deregulated in 1999 by the Gramm-Leach-Biley Act, which repealed the Glass-Steagall Act and essentially allowed for the excessive risk taken on by banks that caused the most recent financial crisis. The Financial Stability Oversight Council was established through the Dodd-Frank Wall Street Reform and Consumer Protection Act and was created to address the systemic risks in the United States financial system and to improve coordination among financial regulators.
-Began using a twin shell electric furnace to increase production and lower costs and increase market share
The 'Secondary' of the 'Secondary'. Accounting: What Do the Numbers Mean?
During the 1920s, approximately 20 million Americans took advantage of post-war prosperity by purchasing shares of stock in various securities exchanges. When the stock market crashed in 1929, the fortunes of many investors were lost. In addition, banks lost great sums of money in the Crash because they had invested heavily in the markets. When people feared their banks might not be able to pay back the money that depositors had in their accounts, a “run” on the banking system caused many bank failures. After the crash, public confidence in the market and the economy fell sharply. In response, Congress held hearings to identify the problems and look for solutions; the answer was found in the new SEC. The Commission was established in 1934 to enforce new securities laws that were passed with the Securities Act of 1933 and the Securities Exchange Act of 1934. The two new laws stated that “Companies publicly offering securities must tell the public the truth about their businesses, the securities they are selling and the risks involved in the investing.” Secondly, “People who sell and trade securities must treat investors fairly and honestly, putting investors’ interests first.”2
The capital maintenance concept used results in differences between the relevance and faithful representation of the data that appears in the balance sheet and income statement. The difference between financial capital maintenance and physical is the treatment of unrealized holding gains and losses. Financial capital maintenance does not allow for unrealized holding gains and losses. Only realized gains and losses are included in income because they “are considered a return on capital” (Schroeder et al., 2013). This means, “income is measured only after the investment is recovered” (Gamble, 1981). Physical capital maintenance “consider[s unrealized holding gains and losses] as returns of capital and do[es] not include them income.” (Schroeder et al., 2013). Instead, they are treated as adjustments to equity and included in other comprehensive income. Therefore, with physical capital maintenance “an increase in an entity’s wealth as...
a. 1. What sources of capital should be included when you estimate Harry Davis’s weighted average cost of capital (WACC)?
The use of fixed charge capital is known as financial leverage. If there is no fixed charge capital, there is no financial leverage. The proper utilization of fixed charged capital like debentures, bonds, bank loan and preference share capital is measured by financial leverage. The firm having more debt capital and preference share capital in its capital structure has higher degree of financial leverage and greater amount of risk.