Chapter 2 Flashcards
(14 cards)
A company has $607 in inventory, $1,894 in net fixed assets, $282 in accounts receivable, $129 in cash, and $330 in accounts payable. What are the company’s total current assets?
A. $1,018
B. $736
C. $1,066
D. $1,348
E. $2,912
A
Muffy’s Muffins had net income of $2,675. The firm retains 70 percent of net income. During the year, the company sold $595 in common stock. What was the cash flow to shareholders?
A. $803
B. $1,278
C. $1,398
D. $2,468
E. $208
E
At the beginning of the year, long-term debt of a firm is $284 and total debt is $327. At the end of the year, long-term debt is $257 and total debt is $337. The interest paid is $23. What is the amount of the cash flow to creditors?
A. -27
B. -50
C. 23
D. 27
E. 50
E
Cash Flow to Creditors = Interest paid - Net new borrowing
= 23 - (ending debt - beg debt)
= 23 - (257-284)
=50 (E)
Peggy Grey’s Cookies has net income of $460. The firm pays out 37 percent of the net income to its shareholders as dividends. During the year, the company sold $91 worth of common stock. What is the cash flow to stockholders?
A. 261.20
B. 460.20
C. 170.20
D. 79.20
E. 289.90
D
Cash flow to stock holders = Dividend paid - net new equity raised
Dividend Paid = 460 * 0.37 = $170.20
= 170.20 - 91 = 79.20
ABC, Inc., had the following operating results for the past year: sales = $22,676; depreciation = $1440; interest expense = $1160; costs = $16,555. The tax rate for the year was 38 percent. What was the company’s operating cash flow?
A. 6121
B. 4961
C. 1885
D. 3075
E. 4783
E. 4783
OCF = EBIT + Depr - taxes
= 4681 + __ - __
Sales= 22676
COGS= -16,555
Dep= -1440
EBIT= $———–
Interest= -1160
EBT= 3521
Tax= ————
NI= 2183
Using the (2017?) Tax table,
What is the average tax rate and marginal tax rate for a firm with taxable income of $129,513
A. 38% and 34%
B. 26% and 39%
C. 37% and 39%
D. 25% and 38%
E. 34% and 35%
B. 26% and 39%
Average rate= ( 50,000.15) +(25000.25)+(25000.34)+ (29,513.39)= (33760/129513) =
Marginal tax rate= Look at the income range at which your income falls to determine the marginal tax rate
ABC, Inc., had the following operating results for the past year: sales = $22,676; depreciation = $1440; interest expense = $1160; costs = $16,555. The tax rate for the year was 38 percent. If the dividend payout ratio is 30%, calculate the Dividends paid and the Retained earnings.
A. 1435 and 3348
B. 1488 and 3472
C. 655 and 1528
D. 922 and 2152
E. 1836 and 4284
C. 655 and 1528
NI= Sales- Cost- depreciation- Interest- taxes
Dividends= NIx.30=
RE= Net Income- Dividends paid
A firm has common stock of $92, paid-in surplus of $290, total liabilities of $420, current assets of $410, and net fixed assets of $620. What is the amount of the shareholders’ equity?
A. $610
B. $1,030
C. $802
D. $540
E. $200
A
A balance sheet has total assets of $1,360, fixed assets of $960, long-term debt of $510, and short-term debt of $135. What is the net working capital?
A. $315
B. $265
C. $375
D. $400
E. $850
B. $265
A company has net working capital of $635. Long-term debt is $3,970, total assets are $6,057, and fixed assets are $3,840. What is the amount of total liabilities?
A. $5,552
B. $5,422
C. $7,810
D. $4,605
E. $6,692
A. $5,552
A firm paid taxes of $46,565 for the year. What is the average tax rate for the firm if it had taxable income of $199,050?
A. 25.73%
B. 23.39%
C. 24.49%
D. 39,34%
E. 46%
B. 23.39%
Kerch Company had beginning net fixed assets of $216,550, ending net fixed assets of $211,715, and depreciation of $40,465. During the year, the company sold fixed assets with a book value of $8,026. How much did the company purchase in new fixed assets?
A. $41,493
B. $43,656
C. $34,310
D. $35,630
E. $32,439
B. $43,656
At the beginning of the year, Vendors, Incorporated, had owners’ equity of $49,655. During the year, net income was $5,975 and the company paid dividends of $4,155. The company also repurchased $8,205 in equity. What was the owners’ equity account at the end of the year?
A. $35,475
B. $43,270
C. $41,450
D. $37,295
E. $47,730
B. $43,270
Adison Winery had beginning long-term debt of $39,231 and ending long-term debt of $44,624. The beginning and ending total debt balances were $48,529 and $53,564, respectively. The company paid interest of $4,309 during the year. What was the company’s cash flow to creditors?
A. $726
B. −$1,084
C. $5,393
D. $9,344
E. −$726
D. $9,344
Cash flow to creditors = End long-term debt - Begining Long-term debt + Interest expenses
