Assume the following relationships for the brauer corp

Problem

Statement of Cash Flows

You have just been hired as a financial analyst for Basel Industries. Unfortunately, company headquarters (where all of the firm's records are kept) has been destroyed by fire. So, your first job will be to recreate the firm's cash flow statement for the year just ended. The firm had $100,000 in the bank at the end of the prior year and its working capital accounts except cash remained constant during the year. It earned $5 million in net income during the year but paid $750,000 in dividends to common shareholders. Throughout the year, the firm purchased $5.5 million of machinery that was needed for a new project. You have just spoken to the firm's accountants and annual depreciation expense for the year is $440,000; however, the purchase price for the machinery represents additions to property, plant, and equipment before depreciation. Finally, you have determined that the only financing done by the firm was to issue long-term debt of $1 million at a 6% interest rate. What was the firm's end-of-year cash balance? Recreate the firm's cash flow statement to arrive at your answer. Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answer to the nearest dollar, if necessary.

Problem

Statement of Cash Flows

W.C. Cycling had $36,000 of cash at year-end 2011 and $15,000 in cash at year-end 2012. The firm invested in property, plant, and equipment totaling $280,000. Cash flow from financing activities totaled +$220,000. Round your answers to the nearest dollar, if necessary.

a What was the cash flow from operating activities?

b

If accruals increased by $35,000, receivables and inventories increased by $50,000, and depreciation and amortization totaled $45,000, what was the firm's net income?

Problem 3-4

Statement of Stockholders' Equity

In its most recent financial statements, Newhouse Inc. reported $60 million of net income and $900 million of retained earnings. The previous retained earnings were $855 million. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid. Write out your answer completely. For example, 25 million should be entered as 25,000,000. Round your answer to the nearest dollar, if necessary.

Problem

Income Statement

Pearson Brothers recently reported an EBITDA of $14.5 million and net income of $3.9 million. It had $2.0 million of interest expense, and its corporate tax rate was 40%. What was its charge for depreciation and amortization? Write out your answer completely. For example, 25 million should be entered as 25,000,000. Round your answer to the nearest dollar, if necessary.

Problem 3-1

Balance Sheet

The assets of Dallas & Associates consist entirely of current assets and net plant and equipment. The firm has total assets of $2.7 million and net plant and equipment equals $2.3 million. It has notes payable of $155,000, long-term debt of $945,000, and total common equity of $1.55 million. The firm does have accounts payable and accruals on its balance sheet. The firm only finances with debt and common equity, so it has no preferred stock on its balance sheet.

Write out your answers completely. For example, 25 million should be entered as 25,000,000.

c What is the amount of total liabilities and equity that appears on the firm's balance sheet?

d

e What is the balance of current assets on the firm's balance sheet?

f

g What is the balance of current liabilities on the firm's balance sheet?

h What is the amount of accounts payable and accruals on its balance sheet? [Hint: Consider this as a single line item on the firm's balance sheet.]

i What is the firm's net working capital?

j What is the firm's net operating working capital?

k What is the monetary difference between your answers to part e and f?

Problem 4-3

DuPont Analysis

Doublewide Dealers has an ROA of 15%, a 2% profit margin, and an ROE of 21%.

What is its total assets turnover? Round your answer to two decimal places.

What is its equity multiplier? Round your answer to two decimal places.

Problem 4-6

DuPont and Roe

A firm has a profit margin of 2% and an equity multiplier of 2.5. Its sales are $110 million, and it has total assets of $33 million. What is its ROE? Round your answer to two decimal places.

Problem 4-10

Ratio Calculations

Assume the following relationships for the Brauer Corp.:

Sales/total assets

1.4x

Return on assets (ROA)

7%

Return on equity (ROE)

14%

Calculate Brauer's profit margin assuming the firm uses only debt and common equity. Round your answer to two decimal places.?

Calculate Brauer's debt-to-assets ratio assuming the firm uses only debt and common equity. Round your answer to two decimal places.?

Problem 4-13

Return on Equity

Midwest Packaging's ROE last year was only 5%; but its management has developed a new operating plan that calls for a debt-to-assets ratio of 40%, which will result in annual interest charges of $484,000. The firm has no plans to use preferred stock. Management projects an EBIT of $1,100,000 on sales of $11,000,000, and it expects to have a total assets turnover ratio of 2.1. Under these conditions, the tax rate will be 35%. If the changes are made, what will be the company's return on equity? Round your answer to two decimal places.

Problem 4-21

Balance Sheet Analysis

Complete the balance sheet and sales information using the following financial data:

Debt-to-assets ratio: 50%

Current ratio: 2.9x

Total assets turnover: 2x

Days sales outstanding: 26 daysa

Gross profit margin on sales: (Sales - Cost of goods sold)/Sales = 45%

Inventory turnover ratio: 7x

aCalculation is based on a 365-day year. Round your answer to the nearest cent.

Balance Sheet

Cash

?

Accounts payable

Accounts

receivable

?

Long-term debt

110,000

inventories

?

Common stock

?

Fixed assets

?

Retained

earnings

165,000

Total assets

$500,000

Total liabilities and equity

?

Sales

?

Cost of goods sold

?

Problem 5-1

Future value

If you deposit $7,000 in a bank account that pays 5% interest annually, how much would be in your account after 5 years? Round your answer to the nearest cent.?

Problem 5-30

Reaching a financial goal

Erika and Kitty, who are twins, just received $15,000 each for their 23th birthdays. They both have aspirations to become millionaires. Each plans to make a $5,000 annual contribution to her "early retirement fund" on her birthday, beginning a year from today. Erika opened an account with the Safety First Bond Fund, a mutual fund that invests in high-quality bonds whose investors have earned 5% per year in the past. Kitty invested in the New Issue Bio-Tech Fund, which invests in small, newly issued bio-tech stocks and whose investors have earned an average of 13% per year in the fund's relatively short history.

If Erika's fund earns the same returns in the future as in the past, how old will she be when she becomes a millionaire? Round your answer to two decimal places?

If Kitty's fund earns the same returns in the future as in the past, how old will she be when she becomes a millionaire? Round your answer to two decimal places?

How large would Erika's annual contributions have to be for her to become a millionaire at the same age as Kitty, assuming their expected returns are realized? Round your answer to the nearest cent.