Problems that say done in excel must be done in excel and the other question can be answered in word Questions and Problems 1. [EXCEL] Balance sheet:...

Problems that say done in excel must be done in excel and the other question can be answered in word

Questions and Problems

1.  [EXCEL] Balance sheet: Given the following information about Elkridge Sporting Goods, Inc., construct a balance sheet for June 30, 2014. On that date the firm had cash and marketable securities of $25,135, accounts receivable of $43,758, inventory of $167,112, net fixed assets of $325,422, and other assets of $13,125. It had accounts payables of $67,855, notes payables of $36,454, long-term debt of $223,125, and common stock of $150,000. How much retained earnings did the firm have?

2.  Inventory accounting: Differentiate between FIFO and LIFO accounting.

3.  Inventory accounting: Explain how the choice of FIFO versus LIFO can affect a firm's balance sheet and income statement.

4.  Market-value accounting: How does the use of market-value accounting help managers?

5.  [EXCEL] Working capital: Laurel Electronics reported the following information at its annual meeting: The company had cash and marketable securities worth $1,235,455, accounts payables worth $4,159,357, inventory of $7,121,599, accounts receivables of $3,488,121, short-term notes payable worth $1,151,663, and other current assets of $121,455. What is the company's net working capital?

6.  [EXCEL] Working capital: The financial information for Laurel Electronics referred to in Problem 5 is all at book value. Suppose marking to market reveals that the market value of the firm's inventory is 20 percent below its book value, its receivables are 25 percent below their book value, and the market value of its current liabilities is identical to the book value. What is the firm's net working capital using market values? What is the percentage change in net working capital?

7.  [EXCEL] Income statement: The Oakland Mills Company has disclosed the following financial information in its annual reports for the period ending March 31, 2014: sales of $1.45 million, costs of goods sold of $812,500, depreciation expenses of $175,000, and interest expenses of $89,575. Assume that the firm has an average tax rate of 35 percent. What is the company's net income? Set up an income statement to answer the question.

8.  Cash flows: Describe the organization of the statement of cash flows.

9.  [EXCEL] Cash flows: During 2014 Towson Recording Company increased its investment in marketable securities by $36,845, funded fixed-assets acquisitions of $109,455, and had marketable securities of $14,215 mature. What is the net cash used in investing activities?

10.  [EXCEL] Cash flows: Caustic Chemicals management identified the following cash flows as significant in its year-end meeting with analysts: During the year Caustic repaid existing debt of $312,080 and raised additional debt capital of $650,000. It also repurchased stock in the open market for a total of $45,250. What is the net cash provided by financing activities?

11.  Cash flows: Identify and describe the noncash expenses that a firm may incur.

12.  [EXCEL] Cash flows: Given the data for Oakland Mills Company in Problem 7, compute the cash flows to investors from operating activity.

13.  [EXCEL] Cash flows: Hillman Corporation reported current assets of $3,495,055 on December 31, 2014 and current assets of $3,103,839 on December 31, 2013. Current liabilities for the firm were $2,867,225 and $2,760,124 at the end of 2014 and 2013, respectively. Compute the cash flow invested in net working capital at Hillman Corporation during 2014.

14.  [EXCEL] Cash flows: Del Bridge Construction had long-term assets before depreciation of $990,560 on December 31, 2013 and $1,211,105 on December 31, 2014. How much cash flow was invested in long-term assets by Del Bridge during 2014?

15.  Tax: Define average tax rate and marginal tax rate.

16.  Tax: What is the relevant tax rate to use when making financial decisions? Explain why.

17.  [EXCEL] Tax: Manz Property Management Company announced that in the year ended June 30, 2014, its earnings before taxes amounted to $1,478,936. Calculate its taxes using Exhibit 3.6.

18.  [EXCEL] Balance sheet: Tim Dye, the CFO of Blackwell Automotive, Inc., is putting together this year's financial statements. He has gathered the following balance sheet information: The firm had a cash balance of $23,015, accounts payable of $163,257, common stock of $313,299, retained earnings of $512,159, inventory of $212,444, goodwill and other assets equal to $78,656, net plant and equipment of $711,256, and short-term notes payable of $21,115. It also had accounts receivable of $141,258 and other current assets of $11,223. How much long-term debt does Blackwell Automotive have?

19.  [EXCEL] Working capital: Mukhopadhya Network Associates has a current ratio of 1.60, where the current ratio is defined as follows: . The firm's current assets are equal to $1,233,265, its accounts payables are $419,357, and its notes payables are $351,663. Its inventory is currently at $721,599. The company plans to raise funds in the short-term debt market and invest the entire amount in additional inventory. How much can notes payable increase without the current ratio falling below 1.50?

20.  [EXCEL] Market value: Reservoir Bottling Company reported the following information at the end of the year. Total current assets are worth $237,513 at book value and $219,344 at market value. In addition, plant and equipment have a market value of $343,222 and a book value of $362,145. The company's total current liabilities are valued at market for $134,889 and have a book value of $129,175. Both the book value and the market value of long-term debt are $144,000. If the company's total assets have a market value of $562,566 and a book value of $599,658, what is the difference between the book value and market value of its stockholders' equity?

21.  [EXCEL] Income statement: Nimitz Rental Company provided the following information to its auditors. For the year ended March 31, 2014, the company had revenues of $878,412, general and administrative expenses of $352,666, depreciation expenses of $131,455, leasing expenses of $108,195, and interest expenses equal to $78,122. If the company's average tax rate is 34 percent, what is its net income after taxes?

22.  [EXCEL] Income statement: Sosa Corporation recently reported an EBITDA of $31.3 million and net income of $9.7 million. The company had $6.8 million in interest expense, and it's average corporate tax rate was 35 percent. What was its depreciation and amortization expense?

23.  [EXCEL] Income statement: Fraser Corporation has announced that its net income for the year ended June 30, 2014, was $1,353,412. The company had EBITDA of $4,967,855 and its depreciation and amortization expense was equal to $1,112,685. The company's average tax rate is 34 percent. What was its interest expense?

24.  [EXCEL] Income Statement: For its most recent fiscal year, Carmichael Hobby Shop recorded EBITDA of $512,725.20, EBIT of $362,450.20, zero interest expense, and cash flow to investors from operating activity of $348,461.25. Assuming there are no non-cash revenues recorded on the income statement, what is the firm's net income after taxes?

25.  [EXCEL] Retained earnings: Columbia Construction Company earned $451,888 during the year ended June 30, 2014. After paying out $225,794 in dividends, the balance went into retained earnings. If the firm's total retained earnings were $846,972 at the end of fiscal year 2014, what were the retained earnings on its balance sheet on July 1, 2013?

26.  [EXCEL] What is the cash flow for Nimitz Rental?

27.  [EXCEL] Tax: Mount Hebron Electrical Company's financial statements indicated that the company had earnings before interest and taxes of $718,323. The interest rate on its $850,000 debt was 8.95 percent. Calculate the taxes the company is likely to owe. What are the marginal and average tax rates for this company?