question 1

The owner of Dennis Smith Co insisted that he wants to see a net income of $4,000,000, at least. He was informed that to do so, operating costs (excluding depreciation and amortization) should remain at 50 percent of sales. Also, depreciation and amortization, interest expense, and the companys tax rate, which is 40 percent, will remain the same even if sales change. The task that should be done is a better job in marketing the sale of the companys products. What level of sales would Smith Company have to obtain to generate $4,000,000 in net income? The owner was shocked with the most recent Net Income achieved by his company. It appeared as follows:

question 2

Avatar Company uses the indirect method to prepare its statement of cash flows. Please refer to the following sections of the comparative balance sheet provided below. Calculate the net Cash flow from financing activities amount.

question 3

During its last financial auditing releases, Rawand Inc reported $363,780 of sales and $168,445 of operating costs excluding depreciation which was accounted for $37,120. As for the companys bonds outstanding they recorded a total of $63,500 carrying 5.72% interest rate compounded annually. During prior year, they carried out expenditures, necessary for it to sustain operations and generate future sales and cash flows, on fixed assets of $88,700 while operating with a net working capital of $31,214. Unlike its pervious year the companys data will keep its steady recording except for the depreciation changing by an increase of $3,740. Thus, assuming the company uses the same depreciation for tax and stockholder reporting purposes, by how much will the depreciation change cause (1) the firm's net income and (2) its free cash flow to change?

question 4

Sales Operating costs (excluding depreciation and amortization) EBITDA Depreciation and amortization EBIT Interest $10,000,000 5,000,000 $5,000,000 1,600,000 $3,400,000 1,400,000 $2,000,000 800,000 $ 1.200.000 EBT Taxes (40%) Net income 25,268,000 19,333,334 17,208,522 28,000,000 None of the above Accounts payable Accrued liabilities Long-term notes payable Total liabilities 2014 2013 $ 4,000 $ 6,000 2.000 1,000 84,000 90,000 $ 90,000 $ 97,000 74,000 Common stock Retained earnings Treasury stock Total equity 30,000 2,000 113,000 (8,000) (5,000) $135,000 $ 71,000 Total liabilities and equity $225,000 $168,000 Additional information: No stock was retired. No treasury stock was sold. During 2014, the company repaid $40,000 of long-term notes payable. During 2014, the company borrowed $34,000 on a new note payable. Net income for the year was $49,000. $ 7,000 $ 8,000 $ 9,000 O $ 10,000 None of the above -$1,258 ; $870 -$2,618; $1,122 -$2,713; $1,703 -$975.77; $863.22 None of the above 7. In 2016, Foolad Company had cash flow from investing activities of (- $110,000), and cash flow from financing activities of (+$60,000). During 2016, Foolad had the following cash flows from operating activities: EBT = $128,333.33 : Tax rate = 40%: Depreciation and Amortization = $10,000 : Accounts payable increased by $45.000 : Inventories increased by $10,000. If the cash balance of Foolad at the end of year 2015 was $10,000. Calculate the cash balance at the end of year 2016.* $ 82,000 $ 72,000 $ 62,000 $ 42,000 None of the above