Use Wal-Mart's financial statements to compute the following ratios (20-31) for the year ended January 31, 2013. 20. Current ratio . 83 . .97 C 65 D. 50 21. Acid-test (quick) ratio A. .10 . .15 . 20 D. 25 22. Accounts receivable turnover A. 65.10 times B. 69.90 times C. 73.85 times D. 78.93 times 23. Inventory turnover A. 5.45 times B. 6.87 times C. 7.16 times D. 8.34 times 24. Profit margin A. 2.75% B. 3.62% C. 4.18% D. 5.34% 25. Asset turnover A. 2.37 times B. 1.23 times C. 3.89 times D. 4.52 times 26. Return on assets A. 8.57% B. 6.19 % C. 9.75% D. 7.32% 12 26. Return on common stockholders' equity A. 15.79 % B. 23.02 % C. 18.94% D. 28.54% 27. Earnings per share (EPS) (Assume the Weighted-Average Common Shares Outstanding is 3.14 billion. A. $5.41 B. $4.35 C. $4.78 D. $6.23 28. Price-earnings (P-E) ratio (Assume the Market Price per Share is $74.75 and the Earnings Per Share is $4.25) A. 10.44 times B. 12.83 times C. 14.35 times D. 17.59 times 29. Payout ratio A. 31.54 % B. 25.64% C. 15.73% D. 20.85% 30. Debt to total assets ratio A. 58.45% B. 72.85% C. 62.16 % D. 54.35% 31. Times interest earned A. 6.48 times B. 10.82 times C. 8.54 times D. 12.43 times TIME VALUE OF MONEY 32. Future Value of S1 John and Mary Rich invested $15,000 in a savings account paying 5.25% interest at the time their son, Mike, was bom. The money is to be used by Mike for his college education. On his 18 birthday, Mike withdraws the money from his savings account. How much did Mike withdraw from his account? A. $42,755.32 B. $30,345.27 C. $35,233.89 D S37,678.11 33. Future Value of Annuity of S1 John and Char Lewis' daughter, Debra, has just started high school. They decide to start a college fund for her and will invest $3,000 in a saving account at the end of each year she is in high school (4 payments total). The account will eam 6.5 % interest compounded annually. How much will be in the college fund at the time Debra graduates from high school? A. $12,345.74 B. $13,221.52 C. $14,864.39 D. $15,211.28 34. Computing a Car Payment Assume you are financing the purchase of a used car with a four-year loan. The loan has a 6% stated annual interest rate, compounded monthly. The price of the car is $8,000. What is the monthly car payment assuming that the payments start one month after the purchase? A. $187.88 B. $195.49 C. $203.40 D. $209.57 35. Present Value of Annuity of S1 You are evaluating financing options for a loan on a house. You decide that the maximum mortgage payment you can afford is $650 per month. The annual interest rate is 8.4 %. If you get a mortgage that requires you to make monthly payments over a 30-year period, what is the maximum home loan you can afford? A. $80,455.37 B. $82,349.58 C. $85,320.01 D. $90,346.55 The following information is used to answer questions 13 to 16 Bonds: $1,000,000 Par Value Semiannual Interest Payments, Three-Year Life Annual Contract Rate: 6% Annual Market Rate: 8% 13. What is the price of the bond? A. 963,544.12 B. 952,877.65 C. 947,578.63 D. 925,587.96 14. What is the amount of the bond discount? A. 52,421.37 B. 50,865.35 C. 47,822.45 D. 45,647.24 15. What is the semi-annual cash payment to the bondholder? A. 25,000 B. 30,000 C. 35,000 D. 40,000 16. What is the interest expense for the second semi-annual payment under the effective interest method? A. 37,903.15 B. 38,219.27 C. 38,548.04 D. 38,889.96 Required: Prepare a complete statement of cash flows; report its cash inflows and cash outflows from operating activities according to the indirect method. Sotbte Corporation Statement of Cash Flows- Indirect Method For Year Ended December 31, 2018 Operating Activities Net income Adjustments to reconcile net income to net cash provided by operating activities Depreciation Increase in accounts receivable Increase in inventory Decrease in accounts payable Increase in income tax payable Net cash provided by operating activities Investing Activities Purchase of Equipment Financing Activities Issuance of common stock Payment of dividends Net cash used by financing activities Net increase in cash Cash at beginning of period Cash at end of period Softbxte Corporation Comparative Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Cash Accounts Receivable Merchandise Inventory Equipment Accumulated Depreciation- Equipment $174,000 S117,000 93,000 81,000 609,000 333,000 534,000 297,000 56.000 SLO53.000 (102.000) S927.000 Total Assets Liabilities & Equity Accounts Payable Income taxes payable Common Stock, $2 par value Paid-in capital in excess of par value, common stock Retained Earnings Total Liabilities & Equity S96,000 $69,000 27,000 582,000 24,000 558,000 198,000 162,000 177.000 SL053.000 87,000 S927.000 Softbxte Corporation Income Statement For Year Ended December 31, 2018 Sales $1,992,000 L194.000 798,000 Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses S01,000 555.000 243,000 Income before taxes Income taxes expense 42,000 Net income $201.000 Additional Information on Year 2018 Transactions Purchased equipment for $36,000 cash. Issued 12,000 shares of common stock for $5 cash per share Declared and paid S111,000 in cash dividends. a. b. c. (Note: Questions 17-19 pertain to the information on Pages 5- 17 What is the net cash provided by operating activities? A. S119,000 B. $122,000 C. $135,000 D. S144,000 18. What is the net cash used by investing activities? A. S(25,000) B. S(28,000) C. S(36,000) D. S(39,000) 19 What is the net cash used by financing activities? A. S(45,000) B. S(51,000) C. S(53,000) D. S(68,000 Wal-Mart Stores Inc. (WMT) Balance Sheet All numbers in thousands View: Annual Data Period Ending Jan 31, 2013 Jan 31, 2012 Jan 31, 2011 Assets Current Assets Cash And Cash Equivalents 7,781,000 6,550,000 7,395,000 Short Term Investments 5,089,000 Net Receivables 6,768,000 5,937,000 Inventory 43,803,000 40,714,000 36,437,000 Other Current Assets 1,588,000 1,774,000 3,091,000 Total Current Assets 59,940,000 54,975,000 52,012,000 Long Term Investments Property Plant and Equipment 116,681,000 112,324,000 107,878,000 20,651,000 Goodwill 20,497,000 16,763,000 Intangible Assets Accumulated Amortization Other Assets 5,456,000 5,987,000 4,129,000 Deferred Long Term Asset Charges 203,105,000 180,782,000 Total Assets 193,406,000 Wal-Mart Stores Inc. (WMT) Income Statement View: Annual Data All numbers in thousands Jan 31, 2013 Jan 31, 2012 Jan 31, 2011 Period Ending 469,162,000 Total Revenue 446,950,000 421,849,000 335,127,000 Cost of Revenue 352,488,000 314,946,000 Gross Profit 116,674,000 111,823,000 106,903,000 Operating Expenses Research Development Selling General and Administrative 88,873,000 85,265,000 81,361,000 Non Recurina Others Total Operating Expenses Operating Income or Loss 27,801,000 26,558,000 25,542,000 Income from Continuing Operations Total Other Income/Expenses Net 187,000 162,000 201000 Earmings Before Interest And Taxes 27,988,000 26,720,000 25,743,000 Interest Expense 2,251.000 2,322,000 2.205,000 25,737,000 24,398,000 Income Before Tax 23,538,000 Income Tax Expense 7,981,000 7,944,000 7.579,000 Minority Interest (757.000) (688,000) (604.000) Net Income Eom Continuing Ops 17,756,000 16,454,000 15,959,000 Non-recuming Events 1,034,000 Discontinued Operations (67,000) Extraordinary Items Effect Of Accounting Changes Oher items Net Income 16,999,000 15,699,000 16,389,000 Preferred Stock And. Other Adjustments Net Income Applicable To Common Shares 16,999,000 15,699,000 16,389,000 The following information is used to answer questions 13 to 16 Bonds: $1,000,000 Par Value Semiannual Interest Payments, Three-Year Life Annual Contract Rate: 6% Annual Market Rate: 8% 13. What is the price of the bond? A. 963,544.12 B. 952,877.65 C. 947,578.63 D. 925,587.96 14. What is the amount of the bond discount? A. 52,421.37 B. 50,865.35 C. 47,822.45 D. 45,647.24 15. What is the semi-annual cash payment to the bondholder? A. 25,000 B. 30,000 C. 35,000 D. 40,000 16. What is the interest expense for the second semi-annual payment under the effective interest method? A. 37,903.15 B. 38,219.27 C. 38,548.04 D. 38,889.96 Required: Prepare a complete statement of cash flows; report its cash inflows and cash outflows from operating activities according to the indirect method. Sotbte Corporation Statement of Cash Flows- Indirect Method For Year Ended December 31, 2018 Operating Activities Net income Adjustments to reconcile net income to net cash provided by operating activities Depreciation Increase in accounts receivable Increase in inventory Decrease in accounts payable Increase in income tax payable Net cash provided by operating activities Investing Activities Purchase of Equipment Financing Activities Issuance of common stock Payment of dividends Net cash used by financing activities Net increase in cash Cash at beginning of period Cash at end of period (Note: Questions 17-19 pertain to the information on Pages 5- 17 What is the net cash provided by operating activities? A. S119,000 B. $122,000 C. $135,000 D. S144,000 18. What is the net cash used by investing activities? A. S(25,000) B. S(28,000) C. S(36,000) D. S(39,000) 19 What is the net cash used by financing activities? A. S(45,000) B. S(51,000) C. S(53,000) D. S(68,000 Softbxte Corporation Comparative Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Cash Accounts Receivable Merchandise Inventory Equipment Accumulated Depreciation- Equipment $174,000 S117,000 93,000 81,000 609,000 333,000 534,000 297,000 56.000 SLO53.000 (102.000) S927.000 Total Assets Liabilities & Equity Accounts Payable Income taxes payable Common Stock, $2 par value Paid-in capital in excess of par value, common stock Retained Earnings Total Liabilities & Equity S96,000 $69,000 27,000 582,000 24,000 558,000 198,000 162,000 177.000 SL053.000 87,000 S927.000 Softbxte Corporation Income Statement For Year Ended December 31, 2018 Sales $1,992,000 L194.000 798,000 Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses S01,000 555.000 243,000 Income before taxes Income taxes expense 42,000 Net income $201.000 Additional Information on Year 2018 Transactions Purchased equipment for $36,000 cash. Issued 12,000 shares of common stock for $5 cash per share Declared and paid S111,000 in cash dividends. a. b. c. Wal-Mart Stores Inc. (WMT) Income Statement View: Annual Data All numbers in thousands Jan 31, 2013 Jan 31, 2012 Jan 31, 2011 Period Ending 469,162,000 Total Revenue 446,950,000 421,849,000 335,127,000 Cost of Revenue 352,488,000 314,946,000 Gross Profit 116,674,000 111,823,000 106,903,000 Operating Expenses Research Development Selling General and Administrative 88,873,000 85,265,000 81,361,000 Non Recurina Others Total Operating Expenses Operating Income or Loss 27,801,000 26,558,000 25,542,000 Income from Continuing Operations Total Other Income/Expenses Net 187,000 162,000 201000 Earmings Before Interest And Taxes 27,988,000 26,720,000 25,743,000 Interest Expense 2,251.000 2,322,000 2.205,000 25,737,000 24,398,000 Income Before Tax 23,538,000 Income Tax Expense 7,981,000 7,944,000 7.579,000 Minority Interest (757.000) (688,000) (604.000) Net Income Eom Continuing Ops 17,756,000 16,454,000 15,959,000 Non-recuming Events 1,034,000 Discontinued Operations (67,000) Extraordinary Items Effect Of Accounting Changes Oher items Net Income 16,999,000 15,699,000 16,389,000 Preferred Stock And. Other Adjustments Net Income Applicable To Common Shares 16,999,000 15,699,000 16,389,000 Wal-Mart Stores Inc. (WMT) Balance Sheet All numbers in thousands View: Annual Data Period Ending Jan 31, 2013 Jan 31, 2012 Jan 31, 2011 Assets Current Assets Cash And Cash Equivalents 7,781,000 6,550,000 7,395,000 Short Term Investments 5,089,000 Net Receivables 6,768,000 5,937,000 Inventory 43,803,000 40,714,000 36,437,000 Other Current Assets 1,588,000 1,774,000 3,091,000 Total Current Assets 59,940,000 54,975,000 52,012,000 Long Term Investments Property Plant and Equipment 116,681,000 112,324,000 107,878,000 20,651,000 Goodwill 20,497,000 16,763,000 Intangible Assets Accumulated Amortization Other Assets 5,456,000 5,987,000 4,129,000 Deferred Long Term Asset Charges 203,105,000 180,782,000 Total Assets 193,406,000 Wal-Mart Stores Inc. (WMT) Balance Sheet (continued) Liabilities Current Liabilities Accounts Payable 59,099,000 55,952,000 52,534,000 Short/Current Lana Tecm Debt 6,348,000 12,719,000 6,022,000 Other Current Liabilities 47,000 Total Current Liabilities 71,818,000 62,300,000 58,603,000 Long Term Debt 41,417,000 47,079,000 43,842,000 Other Liabilities Deferred Long Term Liability Charges 7,613,000 7,862,000 6,682,000 Minority Interest 5,395,000 4,446,000 2,705,000 Negative Goodwill Total Liabilities 126,243,000 121,687,000 111,832.000 Stockholders Equity Misc, Stocks Options Warrants 519,000 404,000 408,000 Redeemable Preferred Stock Preferred Stock 342,000 Common Stock 332,000 352,000 68,691,000 63,967,000 Retained Earnings 72,978,000 Treasury Stock 3,620,000 3,577,000 Capital Surplus 3,692,000 Other Stockholder Equity (587,000) (1,410,000) 646,000 Total Stockholder Equity 76,343,000 71,315,000 68,542,000 Wal-Mart Stores Inc. (WMT) Statement of Cash Flows View: Annual Data All numbers in thousands Period Ending Jan 31, 2013 Jan 31, 2012 Jan 31, 2011 16,389,000 Net Income 16,999,000 15,699,000 Operating Activities, Cash Flows Provided By or Used in 8,501,000 Depreciation 8,130,000 7,641,000 Adjustments To Net Income 394,000 1,515,000 704,000 Changes In Accounts Receivables (614,000) (796,000) (733,000) Changes In Liabilities 2,313,000 2,746,000 2,243,000 Changes In Inventories (2.759,000) (3,727,000) (3205,000) Changes In Other Operating Activities Total Cash Flow From Operating Activities 25,591,000 24,255,000 23,643,000 Investing Activities, Cash Flows Provided By.or Used In Capital Expenditures (12,898,000) (13,510,000) (12,699,000) (202,000) Investments (316,000) (3,548,000) Other Cash flows from Investing Activities 708,000 603,000 449,000 (12,193,000) Total Cash Flows From Investing Activities (12,611,000) (16,609,000) Financing Activities, Cash Flows Provided By,or Used In (5,361,000) Dividends Paid (5,048,000) (4,437,000) Sale Purchase of Stock (7,600,000) (6,298,000) (14,776,000) Net Borrowings 1,487,000 3,485,000 7,819,000 Other Cash Flows from Financing Activities (498,000) (597,000) (634,000) Total Cash Flows From Financing Activities (11,972,000) (8,458,000) (12,028,000) Effect Of Exchange Rate Changes 223,000 (33,000) 66,000 1,231,000 Change In Cash and Cash Equivalents (845,000) (512,000) Use Wal-Mart's financial statements to compute the following ratios (20-31) for the year ended January 31, 2013. 20. Current ratio . 83 . .97 C 65 D. 50 21. Acid-test (quick) ratio A. .10 . .15 . 20 D. 25 22. Accounts receivable turnover A. 65.10 times B. 69.90 times C. 73.85 times D. 78.93 times 23. Inventory turnover A. 5.45 times B. 6.87 times C. 7.16 times D. 8.34 times 24. Profit margin A. 2.75% B. 3.62% C. 4.18% D. 5.34% 25. Asset turnover A. 2.37 times B. 1.23 times C. 3.89 times D. 4.52 times 26. Return on assets A. 8.57% B. 6.19 % C. 9.75% D. 7.32% 12 26. Return on common stockholders' equity A. 15.79 % B. 23.02 % C. 18.94% D. 28.54% 27. Earnings per share (EPS) (Assume the Weighted-Average Common Shares Outstanding is 3.14 billion. A. $5.41 B. $4.35 C. $4.78 D. $6.23 28. Price-earnings (P-E) ratio (Assume the Market Price per Share is $74.75 and the Earnings Per Share is $4.25) A. 10.44 times B. 12.83 times C. 14.35 times D. 17.59 times 29. Payout ratio A. 31.54 % B. 25.64% C. 15.73% D. 20.85% 30. Debt to total assets ratio A. 58.45% B. 72.85% C. 62.16 % D. 54.35% 31. Times interest earned A. 6.48 times B. 10.82 times C. 8.54 times D. 12.43 times TIME VALUE OF MONEY 32. Future Value of S1 John and Mary Rich invested $15,000 in a savings account paying 5.25% interest at the time their son, Mike, was bom. The money is to be used by Mike for his college education. On his 18 birthday, Mike withdraws the money from his savings account. How much did Mike withdraw from his account? A. $42,755.32 B. $30,345.27 C. $35,233.89 D S37,678.11 33. Future Value of Annuity of S1 John and Char Lewis' daughter, Debra, has just started high school. They decide to start a college fund for her and will invest $3,000 in a saving account at the end of each year she is in high school (4 payments total). The account will eam 6.5 % interest compounded annually. How much will be in the college fund at the time Debra graduates from high school? A. $12,345.74 B. $13,221.52 C. $14,864.39 D. $15,211.28 34. Computing a Car Payment Assume you are financing the purchase of a used car with a four-year loan. The loan has a 6% stated annual interest rate, compounded monthly. The price of the car is $8,000. What is the monthly car payment assuming that the payments start one month after the purchase? A. $187.88 B. $195.49 C. $203.40 D. $209.57 35. Present Value of Annuity of S1 You are evaluating financing options for a loan on a house. You decide that the maximum mortgage payment you can afford is $650 per month. The annual interest rate is 8.4 %. If you get a mortgage that requires you to make monthly payments over a 30-year period, what is the maximum home loan you can afford? A. $80,455.37 B. $82,349.58 C. $85,320.01 D. $90,346.55