total assets are e $6‚230‚ and fixed assets are $3‚910. What is the amount of the total liabilities? Current assets: 6230-3910=2320 Current liabilities: 6230-39102320-640=1680 Total liabilities: 1680+4180=5860 2. Kaylor Equipment Rental paid $75 in dividends and $511 in interest expense. The addition to retained earnings is $418 and net new equity is $500. The tax rate is 35 percent. Sales are $15‚900 and depreciation is $680. What are the earnings before interest and taxes? Net Income: 75+418=493
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PROBLEMS 1. Table 3.3 shows the December 31‚ 2009 pro- forma balance sheet and income statements for R& E Supplies‚ Inc. The pro- forma balance sheet shows that R& E Supplies will need external funding from the bank of $ 1.4 million. However‚ they show $ 1.27 million in cash and short- term securities. Why are they going to the bank when they have most of the required amount in their cash account? 2. Pro forma financial statements‚ by definition‚ are predictions of a company’s financial statements
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that has been conducted‚ the top ten common problems encountered by the high school students 1were as follows: 1.Memory blocks 2.Exam stress 3.Lack of preparation 4.Panic attacks 5.Illness/Sickness 6.Lack of knowledge about the topic 7.Misunderstanding of directions 8.Pressure and Financial Problems 9.Unpleasant weather conditions 10.No permit According to the respondents‚ memory block is their no. 1 problem during examinations. Getting rid of this problem is very hard especially to those
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CHANGES IN BALANCE SHEET ACCOUNTS The total assets of a firm and the claims on assets change over time because of investing and financing activities. For example‚ a firm may issue common stock for cash; acquire a building by mortgaging a portion of the purchase price‚ or issue common stock in exchange for convertible bonds. These investing and financing activities affect the amount and structure of a firm’s assets‚ liabilities‚ and shareholders’ equity. The total assets of a firm and the claims
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Chapter 3 The Balance Sheet and Financial Disclosures Questions for Review of Key Topics Question 3-1 The purpose of the balance sheet‚ also known as the statement of financial position‚ is to present the financial position of the company on a particular date. Unlike the income statement‚ which is a change statement that reports events occurring during a period of time‚ the balance sheet is a statement that presents an organized array of assets‚ liabilities
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breach‚ and lastly is to determine whether the losses were an equitably foreseeable consequence of the defendant’s actions. CONTENTS Negligent misstatement refers to a representation of fact that been carelessly made‚ which is relied on the plaintiff to their advantages (O’Riordan‚ 2007‚ p.1). In 1964‚ the tort of negligent misstatement has been established and it has gained more recognition in this decades. It covers opinions and reality statements made by negligence. However‚ the tort
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Problem 3 Accounting Chapter 21 Problem 3 A firm’s current balance sheet is as follows: Assets = $100 Debt = $10 Equity = $90 A. What is the firm’s weighted-average cost of capital at various combinations of debt and equity‚ given the following information? Debt/Assets | After-tax Cost of Debt | Cost of Equity | Cost of Capital | 0% | 8% | 12% | 12.00% | 10% | 8% | 12% | 11.60% | 20% | 8% | 12% | 11.20% | 30% | 8% | 13% | 11.50% | 40% | 9% | 14% | 12.00% | 50%
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Off balance sheet financing is financing from sources other than debt or equity offerings‚ such as joint ventures‚ research and development partnership and operating leases. For complex institutions such as banks‚ they increase their use of off shore subsidiaries and swap transactions to avoid disclosing liabilities. In other words‚ off balance sheet accounting is a process which a business creates what is practically a debt that it must pay off‚ but the debt is accounted as another type of transaction
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bad debts. The student should also keep in mind that the budgeting process is not an exact science; therefore‚ approximate figures provide adequate information for the decision maker. Figures should be rounded to the whole dollar throughout the budgeting process and the control applications. Since it is not possible to have a partial machine or person‚ certain figures will always have to be rounded up. GENERAL COMPANY INFORMATION Fantastic‚ Inc. is a paint manufacturing company that produces
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1 . (a) What do you understand by the concept of conservatism ? Why is it also called the concept of prudence? Why is it not applied as strongly today as it used to be in the Past ? (b) What is a Balance Sheet ? How does a Funds Flow Statement differ from a Balance Sheet ? Enumerate the items which are usually shown in a Balance Sheet and a Funds Flow Statement. 2 . (a) Discuss the importance of ratio analysis for inter-firm and intra-firm comparisons including circumstances responsible
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