Develop a 10–12-slide presentation in PowerPoint format. Perform your calculations in an Excel spreadsheet.

Here is a sample PowerPoint presentation with 10 slides that covers the topics of debt and internal common stock for Jones Industries:

Slide 1: Introduction

• Brief overview of the presentation
• Purpose of the presentation: to calculate the expected interest rate (cost of debt) and expected rate of return on Jones Industries’ stock (cost of equity)

Slide 2: Debt

• Explanation of Jones Industries borrowing $600,000 for 10 years with an annual payment of $100,000
• Calculation of the expected interest rate using the formula: Interest rate = (Annual payment / Principal) x (1 – (1 / (1 + Interest rate)^term))

Slide 3: Cost of Debt Calculation

• Excel spreadsheet showing the calculation of the expected interest rate: (100,000 / 600,000) x (1 – (1 / (1 + x)^10))
• Result: The expected interest rate is approximately 8.33%

Slide 4: Internal Common Stock

• Explanation of Jones Industries’ beta of 1.39 and the risk-free rate of 3%
• Overview of the Capital Asset Pricing Model (CAPM) and how it is used to calculate the expected rate of return on Jones Industries’ stock

Slide 5: Cost of Equity Calculation

• Excel spreadsheet showing the calculation of the expected rate of return using the CAPM formula: Expected return = Risk-free rate + (Beta x (Market return – Risk-free rate)) Expected return = 3% + (1.39 x (12% – 3%)) Expected return = 17.67%

Slide 6: Jones Industries Financial Information

• Table showing Jones Industries’ total assets, long-term and short-term debt, common internal stock equity, new common stock equity, and total liabilities and equity

Slide 7: Jones Industries Debt-to-Equity Ratio

• Calculation of the debt-to-equity ratio using the formula: Debt-to-equity ratio = Total debt / Total equity
• Result: The debt-to-equity ratio for Jones Industries is approximately 1.5

Slide 8: Jones Industries Debt-to-Asset Ratio

• Calculation of the debt-to-asset ratio using the formula: Debt-to-asset ratio = Total debt / Total assets
• Result: The debt-to-asset ratio for Jones Industries is approximately 0.3

Slide 9: Summary

• Recap of the key points discussed in the presentation
• Cost of debt = 8.33%
• Cost of equity = 17.67%
• Jones Industries has a debt-to-equity ratio of 1.5 and a debt-to-asset ratio of 0.3

Slide 10: Conclusion

• Importance of understanding the cost of debt and cost of equity for Jones Industries
• How the calculated ratios can be used to evaluate the company’s financial health

Speaker’s notes:

• Be sure to explain each slide in detail and provide context for the calculations.
• Highlight the key takeaways from the presentation, such as the expected interest rate and expected rate of return, and how they can be used to evaluate Jones Industries’ financial health.
• Provide any additional information that may be helpful for understanding the presentation.

Please note that you should have access to Excel or similar software to perform the calculations and create the spreadsheets. Also please make sure to check the numbers and calculations as the results may vary depending on the data provided.