True or False!

Consider the balance sheet of Wilkes Industries as shown below. Because Wilkes has 500.000 of retained carings, the company would be able to pay cash to buy with a cost of $200,000 $ 100.000 Cu Levy Acce Total Current Assets Net fixed assets es S $ 50.000 Accounts payable 200.000 Accra 2D Total Current L see Debe $ 900 000 Comme sock Retained carmines S1.200 Total L e s 200 200 Totalt Equity $1,400 income a company would generate Net operating profiter tanes(NOPAT) is the amount of from its operations if it had no interest income or interest expense. The retained caring account on the balance sheet does not represent cash Rather t ests part of sockholders claims against the firm's existing assets. This implies that retained earnings are in fact stockholders invested carings In accounting, emphasis is placed on determining net income in accordance with generally accepted accounting principles. In finance, the primary emphasis is also on net income because that is what investisse to value the firm. However, a secondary financial consideration is cash flow, because cash seeded to the business 5. From a corporate finance perspective, the value of any asset financial or physical, is the present value of the future cash flows the asset is expected to generate, and this includes the expected future cash flow a hond Disregarding risk, if money has time value, it is impossible for the future value of a given sum to exceed its present value 7. The fundamental value of a company is another way investors describe a company's intrinse value but fundamental value does not refer to a value derived from using a discounted cash flow model A company seeking to increase its equity capital should focus more on understanding the short-term bond yields than on the returns that equity investors are seeking As a general statement, it is true that the assumptions underlying a financial model we find and cannot be changed the finance is precio 10. A bond has a $1.000 par value, makes annual interest payments of S100, has 5 years to maturity, cannot be called, and is not expected to default. The bond should sell at a premium if interest rates are below 10% and at a discount if interest rates are greater than 10%