Essay - Financial Management 3-2. Assets Current Assets Cash 3,000 Receivables, Less...

Financial Management

3-2. Assets

Current Assets

Cash 3,000

Receivables, less allowance 3,000

Inventory

Prepaid expenses 2,000

Non-current/Fixed *****

Land

Buildings

Machinery and equipment

*****: Accumulated depreciation

Other assets (long term) 7,000

Liabilities

Current Liabilities

Accounts payable

Non-current Liabilities

Long-term debt

Deferred income tax liability (long term)

Accrued income taxes 3,000

Other accrued expenses

***** portion of long-term ***** 7,000

***** Equity

Common stock, no par value, 10,000 shares authorized, 5,724 ***** issued $ 3,180

Retained earnings

3-11. a. Annu*****l Depreciation Expense = ($100,000 - $10,000)/10 yrs = $9,000 for each ***** the first three years b. We will use ***** dou*****le declining method, which means that the ***** rate used ***** be (100%)/10 ***** times 2 = 20 %

***** Value -

Beginning of Year

*****

Rate

Depreciation

Expense

Accumulated

Depreciation

Book Value -

End of Year

100,000 (Original Cost)

The depreciation in the first three years according to this method is $*****,000, $16,000 ***** $8,800.

c. Depreciable Cost = $90,000

***** sum ***** the digits = 55.

Depreciation rates are: 10/***** for the first year, 9/55 for the second year and 8/55 for the thirds. Thus, 1yrs - $16,363 yrs - $14,727 yrs ***** $13,090

P4-1.

*****. Operating Revenues

Sales

***** expenses

Operating Expenses

***** expense $

Income taxes

Interest expense

Flood loss (net of tax)

Purchases

Merchandise inventory, 1/1

***** ***** 12/31

Non-operating *****

Dividend income b. Earnings per share = $9.57 c. Revenues & Gains $967,000

***** & Losses $1,762,000

Net Income - $ 795,000

5*****1. a. The current assets proportion ***** total assets in 2006 was 67.3 %, while ***** 2007 ***** figure ***** 66.9 %. As we can see, there is a slight, but not significant decrease from 2006 to 2007, mainly explainable through an increase in total assets at a more *****ccelerated pace th***** current *****.

At *****e same time, long term debt to *****tal assets was 4.29 % in ***** and 1.5 % in 2006, marking a significant increase of almost three *****s from one year to the other. The explanation is justified by a signific*****nt increase in the long-term debt, which, despite being at reasonable levels in absolute terms, has grown significantly as a proportion of the long term *****.

b. If ***** is considered 100 %, the *****t*****l current assets in 2007 amounted to 137 %, a 37 % ***** from the previous year. At the same times, with 2006 as *****, 2007 total assets *****re 114 %, a sm*****ll increase compared to the ***** year. The same is noticeable ***** *****tal liabilities.

c. ***** trend showed gradual ********** for all comp*****nts of the balance sheet, showing a regular and sustained development of the company. Some ***** these however had a more ***** *****scending trend.

5-4. a.

Revenue ***** services

***** e*****rnings b. As compared to the 2004 *****ase, net earnings have increased in 2006 with almost 200 %, similar figures being noticeable in comparison with 2004 to many of ***** other figures on the statement of *****.

6-2. a. days'