BBA 2011

2.0 Task 1
In 2012 Inbox Software had 9,000 million shares of common stock authorized,4,260 million in issue, and 3,847 million outstanding (figure rounded to the nearest million). Its equity account was as follows: Common stock $ 213 Additional paid-in capital 5,416 Retained earnings 10,109 Treasury shares 6,851
Currency translation adjustment and contributions to an employee benefit trust have been deducted from retained earnings. 1.1 What was the par value of each share? = $0.05 per share
What was the average price at which shares were sold? $132 per share
1.3 How many shares had been repurchased?
4,260 million share – 3,847 million share =413 million share
1.4 What was the average price at which the shares were repurchased? $ 16.59 per share
1.5 What was the value of the net common equity?
$213 million + $5,416 million +$10,109 million - $6851 million = $ 8887 million

3.0 Task 2
Dynamic Futon forecasts the following purchases from suppliers:

Jan
Feb
Mar
Apr
May
Jun
Value of goods ($ millions)
32
28
25
22
20
20

(a) Forty percent of goods are supplied cash on delivery. The remainders are paid with an average delay of one month. If Dynamic Futon starts the year with payables of $22 million, what is the forecasted level of payables for each month?
January $ 38 million x 60% = $ 19.2million
February $ 28 million x 60% = $ 16.8million
March $ 25 million x 60% = $ 15million
April $ 22 million x 60% = $13.2 million
May $ 20 million x 60% = $ 12million
June $ 20 million x 60% = $ 12 million

(b) Suppose that from the start of the year the company stretches payables by paying 40