Business Finance Chpt. 3 Assignment

NOW Inc. released its annual results and financial statements. Grace is reading the summary in the business pages of today’s paper. In its annual report, NOW Inc. reported a net income of $200 million. Last year, the company reported a retained earnings balance of $544 million, whereas this year it increased to $640 million. How much was paid out in dividends this year? 104 million
Which account represents the cumulative earnings of the firm since the firm started, minus dividends paid? Retained Earnings
Cold Goose’s pool of relatively liquid assets, which are available to support the company’s current and future sales, decreased from Year 1 to Year 2.
Emery Mining Inc. recently reported $150,000 of sales, $75,500 of operating costs other than depreciation, and $10,200 of depreciation. The company had $16,500 of outstanding bonds that carry a 7.25% interest rate, and its federal-plus-state income tax rate was 35%. How much was the firm’s net income? The firm uses the same depreciation expense for tax and stockholder reporting purposes. $41,017.44
Yum Co. uses cash to repurchase 10% of its common stock. Financing Activities
Brown Office Supplies recently reported $15,500 of sales, $8,250 of operating costs other than depreciation, and $1,750 of depreciation. It had $9,000 of bonds outstanding that carry a 7.0% interest rate, and its federal-plus-state income tax rate was 40%. How much was the firm’s earnings before taxes (EBT)? 4870
Analysts who follow Howe Industries recently noted that, relative to the previous year, the company’s net cash provided from operations increased, yet cash as reported on the balance sheet decreased. Which of the following factors could explain this situation? The company made large investments in fixed assets.
The _____ has three segments that when analyzed together give an idea of what the company owns and what it owes Balance Sheet
Brown Office Supplies recently reported $15,500 of sales, $8,250 of operating costs other than depreciation, and $1,750 of depreciation. It had $9,000 of bonds outstanding that carry a 7.0% interest rate, and its federal-plus-state income tax rate was 40%. How much was the firm’s EBIT (earnings before interests and taxes)? 5,500
Gross profit is equal to sales – cost of goods sold
Bauer Software’s current balance sheet shows total common equity of $5,125,000. The company has 530,000 shares of stock outstanding, and they sell at a price of $27.50 per share. By how much do the firm’s market and book values per share differ? ANSWER: aRATIONALE: Shares outstanding 530,000Price per share $27.50Total book common equity $5,125,000Book value per share = Total book equity/Number of shares $9.67Difference between book and market values $17.83
The firm has never paid a dividend on its common stock, and it issued $2,400,000 of 10-year, non-callable, long-term debt in 2013. As of the end of 2014, none of the principal on this debt had been repaid. Assume that the company’s sales in 2013 and 2014 were the same. Which of the following statements must be CORRECT?
Identify which type of activity is described by the following statement:A company buys some common stock in its supplier’s firm with its extra cash. investing
Fitzi Chemical Co. earns revenue from its cash receipts from royalties. operating
During 2014, Bascom Bakery paid out $33,525 of common dividends. It ended the year with $197,500 of retained earnings versus the prior year’s retained earnings of $159,600. How much net income did the firm earn during the year? $71,425
Which of the following best describes shareholders’ equity? Equity is the sum of what the initial stockholders paid when they bought company shares and the earnings that the company has retained over the years.
Which major financial statement answers the following question:Can the firm meet all its short-term obligations using its current assets? balance sheet

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