The Centennial Chemical Corporation announced that, for the period ending March 31, 2011, it had earned income after taxes worth $2,369,635.79 on revenues of $13,108,004. The company's costs (excluding depreciation and amortization) amounted to 61 percent of sales, and it had interest expenses of $392,168. What is the firm's depreciation and amortization expense if its tax rate is 34 percent? (Round answer to 2 decimal places e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45.25 or parentheses e.g. (45.25).)
1. What is net working capital? Net working capital = Current Assets - Current Liabilities 2. What is the appropriate goal of financial managers? Can managers' decisions affect this goal in any way? If so, how? The goal of the financial manager is to maximize the value of the firms stock. Managers decision can affect this goal because they can decide on investing and/or financing opportunities that can either be good or bad for the company. 3. What are some of the regulations that pertain to boards of directors that were put in place to reduce agency conflicts? One of them is that the board has a fiduciary responsibility to represent the best interest of the company's owners. Another is that the majority of the board needs to be outside independent directors. Another one is that CEO and chairman positions should be separated. There are various others as well. 4. Caustic Chemicals management identified the following cash flows as significant in their year-end meeting with analysts: During the year Caustic repaid existing debt of $343,980 and raised additional debt capital of $644,163. It also repurchased stock in the open market for a total of $38,213. What is the net cash provided by financing activities? Net cash provided by financing activities Ans $261,970 5. Tim Dye, the CFO of Blackwell Automotive, Inc., is putting together this year's financial statements. He has gathered the following balance sheet information: The firm had a cash balance of $23,015, accounts payable of $163,257, common stock of $267,413, retained earnings of $512,159, inventory of $223,941, goodwill and other assets equal to $78,656, net plant and equipment of $620,133, and short-term notes payable of $21,115. It also had accounts receivable of $141,258 and other current assets of $11,223. How much long-term debt does Blackwell Automotive have? Long-term debt $ 5.1. Tim Dye, the CFO of Blackwell Automotive, Inc., is putting together this year's financial statements. He has gathered the following balance sheet information: The firm had a cash balance of $23,015, accounts payable of $163,257, common stock of $309,815, retained earnings of $512,159, inventory of $226,994, goodwill and other assets equal to $78,656, net plant and equipment of $680,459, and short-term notes payable of $21,115. It also had accounts receivable of $141,258 and other current assets of $11,223. How much long-term debt does Blackwell Automotive have? 155259 6. For its most recent fiscal year, Carmichael Hobby Shop recorded EBITDA of $543,634.16, EBIT of $362,450.20, zero interest expense, and cash flow to investors from operating activity of $318,441.24. Assuming there are no non-cash revenues recorded on the income statement, what is the firm's net income after taxes? Net income $ 6.1. For its most recent fiscal year, Carmichael Hobby Shop recorded EBITDA of $541,532.13, EBIT of $362,450.20, zero interest expense, and cash flow to investors from operating activity $335,009.06. Assuming there are no non-cash revenues recorded on the income statement, what is the firm's net income after taxes? Ans $155,927.13 7. The Centennial Chemical Corporation announced that, for the period ending March 31, 2011, it had earned income after taxes worth $2,351,577.01 on revenues of $13,140,145. The company's costs (excluding depreciation and amortization) amounted to 61 percent of sales, and it had interest expenses of $392,168. What is the firm's depreciation and amortization expense if its tax rate is 34 percent? Depreciation and amortization 7.1. The Centennial Chemical Corporation announced that, for the period ending March 31, 2011, it had earned income after taxes worth $2,331,305.01 on revenues of $13,077,128. The company's costs (excluding depreciation and amortization) amounted to 61 percent of sales, and it had interest expenses of $392,168. What is the firm's depreciation and amortization expense if its tax rate is 34 percent? 1,175,631.60 8. Analysts following the Tomkovick Golf Company were given the following balance sheet information for the years ended June 30, 2011 and June 30, 2010: Assets Cash and marketable securities Accounts receivable Inventory Other current assets Total current assets Plant and equipment Less: Accumulated depreciation Net plant and equipment Goodwill and other assets Total assets Liabilities and Stockholders' Equity 2011 $33,411 227,616 456,408 41,251 $758,686 1,969,822 (457,147) $1,512,675 382,145 $2,653,506 2011 2010 $16,566 318,768 352,740 29,912 $717,986 1,609,898 (206,678) $1,403,220 412,565 $2,533,771 2010 Accounts payable and accruals Notes payable Accrued income taxes Total current liabilities Long-term debt Total liabilities Preferred stock Common stock (10,000 shares) Additional paid-in capital Retained earnings Less: Treasury stock Total common equity Total liabilities and stockholders' equity $378,236 14,487 21,125 $413,848 726,720 $1,140,568 10,000 975,465 540,807 (13,334) $1,512,938 $332,004 7,862 16,815 $356,681 793,515 $1,150,196 10,000 975,465 398,110 $1,383,575 $2,653,506 $2,533,771 In addition, it was reported that the company had a net income of $2,784,954 and that depreciation expenses were equal to $250,469. Company paid dividends of 2,642,257. a. Construct a cash flow statement for this firm. b. Calculate the net cash provided by operating activities for the statement of cash flows. c. What is the net cash used in investing activities? d. Compute the net cash provided by financing activities. Tomkovick Golf Company Year ended June 30, 2011 Operating Activities Net income Additions (sources of cash) Depreciation and amortization Increase in accounts payable Decrease in accounts receivable Increase in accrued income taxes Subtractions (uses of cash) Increase in other current assets Increase in inventories Net cash operating activities Long-Term Investing Activities Increase in property equipment Decrease in goodwill and other assets Net cash investing activities Financing Activities $ $ $ $ Increase in notes payable Decrease in long-term debt Payment of cash dividends Purchase of treasury stock Net cash financing activities $ Effect of exchange rates on cash Net increase in cash and marketable securities Cash and securities at beginning of year Cash and securities at end of year $ $ $ 8.1. Analysts following the Tomkovick Golf Company were given the following balance sheet information for the years ended June 30, 2011 and June 30, 2010: Assets Cash and marketable securities Accounts receivable Inventory Other current assets Total current assets Plant and equipment Less: Accumulated depreciation Net plant and equipment Goodwill and other assets Total assets Liabilities and Stockholders' Equity Accounts payable and accruals Notes payable Accrued income taxes Total current liabilities Long-term debt Total liabilities Preferred stock Common stock (10,000 shares) Additional paid-in capital Retained earnings Less: Treasury stock Total common equity Total liabilities and stockholders' equity 2011 $33,411 267,146 416,878 41,251 $758,686 2,105,369 (592,694) $1,512,675 382,145 $2,653,506 2011 $378,236 14,487 21,125 $413,848 629,291 $1,043,139 10,000 975,465 638,236 (13,334) $1,610,367 2010 $16,566 318,768 352,740 29,912 $717,986 1,609,898 (206,678) $1,403,220 412,565 $2,533,771 2010 $332,004 7,862 16,815 $356,681 793,515 $1,150,196 10,000 975,465 398,110 $1,383,575 $2,653,506 $2,533,771 In addition, it was reported that the company had a net income of $3,519,331 and that depreciation expenses were equal to $386,016. Company paid dividends of 3,279,205. a. Construct a cash flow statement for this firm. b. Calculate the net cash provided by operating activities for the statement of cash flows. c. What is the net cash used in investing activities? d. Compute the net cash provided by financing activities. Tomkovick Golf Company Year ended June 30, 2011 Operating Activities Net income Additions (sources of cash) Depreciation and amortization Increase in accounts payable Decrease in accounts receivable Increase in accrued income taxes Subtractions (uses of cash) Increase in other current assets Increase in inventories Net cash provided by operating activities Long-Term Investing Activities Increase in property equipment Decrease in goodwill and other assets Net cash used in investing activities Financing Activities Increase in notes payable Decrease in long-term debt Payment of cash dividends Purchase of treasury stock Net cash provided by financing activities Effect of exchange rates on cash Net increase in cash and marketable securities Cash and securities at beginning of year Cash and securities at end of year $3,519,331 386,016 46,232 51,622 4,310 -11,339 -64,138 $3,932,034 $-495,471 30,420 $-465,051 $6,625 -164,224 -3,279,205 -13,334 $-3,450,138 $0 16,845 16,566 $33,411
