Bus 106 HW Assignment 1 Essays - Business Economics, Accounting

Bus 106 HW Assignment 1 Essays - Business Economics, Accounting Bus 106 HW Assignment 1 Francis Anand 1/13/17 Balance Sheet Assets Liabilities Current Assets:Current Liabilities: -Cash balances-$10,000-Accounts Payable-$17,000 -Inventory-$200,000Long Term Liabilities: -Accounts Receivable-$22,000-Long Term Debt-$170,000 Property, Plant, Equipment: -Store + Property-$100,000 Total Assets - $332,000Total Liabilities - $187,000 Equity = 332,000 - 187,000 = $145,000 A) Net Income: 2,000 = 20% of revenue so Revenue is 10,000 - (8,000+2000+3000+1000+1000)= -$5,000 B) Revenue: 2,000 = 20% of revenue so Revenue is $10,000 C) EBIT: 10,000 - (8,000++3000+1000+1000) = -$3,000 Dividends Paid: (3,700,000+900,000) - 3,400,000 = $1,200,000 A) Book Value: $200,000 Market Value: $50,000,000 B) Price Per Share: 50mil/2Mil = $25Mil Book Value Per Share: 200,000/2mil = $0.1 A) Increase B) Increase C) Decrease A) Net Income: 14mil - (8mil+2mil+1mil) = $3Mil Cash Flow: 3Mil + 2Mil +1Mil = $5Mil B) Net Income would decrease by 1Mil but Cash flow would not be affected C) This would have a negative impact on the firm's stock D) Net Income would decrease by 3Mil E) Cash Flow would decrease by 2Mil A) Market Value added: 657 x 83 = $54,531 B) Market to Book Ratio: 54531/42524 = 1.3 C) Yes the company has created value for shareholders A) Economic Value Added: 627 - (108+325) = 194 B) Return on Capital: 534 - (108+325) = 101 C) Return on Equity: 534/256 = 2.09 D) Yes, the company is creating value for its shareholders.