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Hello, all the references needed for these questions can be found in this link provided below. Could anyone help please? It is the Assignment 2
Hello, all the references needed for these questions can be found in this link provided below. Could anyone help please?
It is the Assignment 2 questions that are needing guidance on.
https://www.coursehero.com/file/126817374/Mini-Business-Case-for-Integrative-Assignment-1-and-2-45fe2330-a701-4be4-a4d0-020e5db6085appt/?focusQaId=48261896
CNE: Impacts on the Balance Sheet and Income Statement CNE: Impacts on the Balance Sheet and Income Statement CNE Inc. sells computer network equipment. The early part of the year turned out to be highly profitable for CNE with record breaking sales from January through March. Exhibit A on page 3 shows the breakout of the number of units sold to CNE's primary customers including when each customer purchased product, when the order was shipped, the number of As the first quarter came to a close profits were at a record high. CNE declared a cash and stock dividend in the month of units purchased and the price per unit. To help expedite sales CNE offered 1/15, n/30 credit terms to all of its customers. March. The cash dividend was set at $.75 cents per share and the stock dividend was set at 7% of total outstanding stock with a par value of $1.50 per share. Total outstanding stock at the end of March was 150,000 shares. The dividends were Integrative Design took advantage of these credit terms with Integrative Design paying within 10 days after the ship date of distributed in April. The stock was trading at $8.50 per share at the time the dividends were declared and distributed. its product. Acore paid for its purchase 35 days after the ship date of its product. While Xplex paid 50% of the order amount at the time it order its product and planned on paying the remaining 50% of its order 45 days after the ship date of its product. Unfortunately, on April 10th Xplex declared bankruptcy and did not pay the remaining accounts receivable Additional Assumptions: balance. 1. Assume the deprecation for the capital equipment starts January 1st. 2. All units are manufactured in the same month of the raw material purchase. To generate more operating cash flow, the company decided to rely more heavily on accounts payable. In January, all 3. Direct Labor is paid for in cash at the end of each month. purchases for raw materials were switched from a cash basis to accounts payable with 2/15 n/30 terms. Exhibit B on page 3 shows the schedule of the company's raw material purchases by month and when CNE paid for each purchase. To remain competitive CNE expanded its output by automating its production process. On January 1st, CNE operationalized $1,000,000 for new robotic equipment and spent another $300,000 to have the equipment installed. The robotic equipment has a useful life up to 7 years. The salvage value of this equipment is estimated at $100,000. As a result of automating its production process, CNE was able to reduce its direct labor cost down to $85 dollars per unit. CNE financed this new equipment purchase through a combination of debt and equity. On January 1st, CNE received a $800,000 loan from a commercial bank at 5% interest. Starting on February 1st principal and interest payments of 11,700 are to be paid on a monthly basis over 7 years. Also, in January CNE issued $750,000 of common stock. In this offering, 100,000 shares were issued at a par value of $3 per share. No Notes.Questions for Integrative Assignment #2. Exhibit A - Sales Schedule 1 . Assuming CNE Inc. could receive 2/15, n/30 terms from its suppliers for its accounts Total Purcashed payable (A/P), how much cash would CNE Inc. pay to its suppliers from January through Company Order Date Shipped Date Units Price April? Amount 2. Integrative Design January 15th February 15th 180 $ 900 $ 162,000 Again, assuming 2/15, n/30 terms from its suppliers, and CNE Inc. adopting a policy of paying its suppliers early based on these terms, what would CNE Inc.'s accounts payable Xplex February 15st March 1st 250 $ 900 $ 225,000 (A/P) ending balance be at the end of March if the beginning A/P balance was zero at Acore March 1st April 1st 310 $ 900 $ 279,000 the beginning of January? 3 . Based on the assumptions given in questions 1 and 2 regarding A/P terms and policies, what is the dollar amount adjustment (if none input 0), CNE Inc. needs to make to inventory in the month of April? Exhibit B - Raw Material Purchase Schedule 4. In the month of April, what will be CNE Inc. interest payment on its $800,000 loan? 5. In the month of April what will be the remaining balance on CNE Inc.'s loan? Material Cost Total Units Purchased 6. Given CNE Inc.'s stock and cash dividend declaration, what is the dollar amount impact Date Received Per Unit Purchased Amount Date Paid to its balance sheet account "Cash Dividend Payable" (if none enter 0), in the month of 300 200 $ 60,000 January 9th March? January 1st 7 . Given CNE Inc.'s stock and cash dividend declaration, what is the dollar amount impact February 1st 320 260 $ 83,200 February 14th to its balance sheet account "Additions to Paid in Capital", (if none enter 0), in the March 1st 295 300 $ 88,500 April 3rd month of March? April 1st 310 230 $ 71,300 April 13th 8. Given CNE Inc.'s stock and cash dividend declaration, what is the dollar amount impact to CNE Inc.'s overall shareholder equity? No NotesStep by Step Solution
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