CT7_Op1_StudentTemplate#TransactionAccountDRCR1Government levied $2,000,000 of General Fund Property tax for the fiscal year with an estimated uncollectible amount of $400,000.2The General Fund paid $350,000 on the vouchers payable that were outstanding at the end of FY 2013.3The General Fund paid the $13,000 reported as Due to Other Funds at the end of FY 2013. This amount was reported as Internal Payables to Business -type Activities at the government-wide level. Assume that it is Tax Year 2014. Complete the yellow area for the General Fund only.Chart of Accounts for General FundCashTaxes Receivable—CurrentEstimated Uncollectible Current TaxesTaxes Receivable—DelinquentEstimated Uncollectible Delinquent TaxesInterest and Penalties Receivable on TaxesEstimated Uncollectible Interest and PenaltiesDue from Other FundsDue from State GovernmentInventory of SuppliesVouchers PayableTax Anticipation Notes PayableDue to Other FundsDue to Federal GovernmentDue to State GovernmentFund Balance—Nonspendable—Inventory of SuppliesFund Balance—Restricted—General GovernmentFund Balance—Restricted—Public SafetyFund Balance—Restricted—Public WorksFund Balance—Restricted—Health and WelfareFund Balance—Restricted—Culture and RecreationFund Balance—Committed—General GovernmentFund Balance—Committed—Public SafetyFund Balance—Committed—Public WorksFund Balance—Committed—Health and WelfareFund Balance—Committed—Culture and RecreationFund Balance—Assigned—General GovernmentFund Balance—Assigned—Public SafetyFund Balance—Assigned—Public WorksFund Balance—Assigned—Health and WelfareFund Balance—Assigned—Culture and RecreationFund Balance—UnassignedBudgetary Fund BalanceEncumbrances OutstandingEstimated RevenuesRevenuesAppropriationsEstimated Other Financing Uses—Interfund Transfers OutExpendituresOther Financing Uses—Interfund Transfers Out Chapter 2 (2-13) Loss Caryrback and Canliforward Financial Statements, Cash Flow, and Taxes Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) 2013 87 2012 Sales Operating costs excluding depreciation Depreciation and amortization Earnings before interest and taxes Less interest Pre-ta:i income Taxes (40%) Net income availabie to common stockhoiders Common dividends $ I i,000 9,360 J6(.t $ 1,260 0a $ i,i40 456 $_684 $ zza s 10,000 8,500 360 $ 1,140 100 $ 1,040 416 $ az+ $ zoo Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2013 2012 A-s.sefs Cash Short-term investments Accounts receivable Inventories Total current assets Net plant and equipment Total assets Liabilities and Equity Accounts payable Accruals Notes payable 'l'otal current liabilities Long-term debt Total Iiabilities Common stock Retained earnings Total common equity Total liabilities and equity $ s50 il0 2,750 1,650 $5,060 3,850 $8,elq $1,100 550 384 $2,A34 1,100 $3,134 4,312 t,464 $s,776 $sels $ s00 100 2,50A 1,500 $4,600 3,500 $8,1.

1. CT7_Op1_StudentTemplate#TransactionAccountDRCR1Govern
ment levied $2,000,000 of General Fund Property tax for the
fiscal year with an estimated uncollectible amount of
$400,000.2The General Fund paid $350,000 on the vouchers
payable that were outstanding at the end of FY 2013.3The
General Fund paid the $13,000 reported as Due to Other Funds
at the end of FY 2013. This amount was reported as Internal
Payables to Business -type Activities at the government-wide
level. Assume that it is Tax Year 2014. Complete the yellow
area for the General Fund only.Chart of Accounts for General
FundCashTaxes Receivable—CurrentEstimated Uncollectible
Current TaxesTaxes Receivable—DelinquentEstimated
Uncollectible Delinquent TaxesInterest and Penalties
Receivable on TaxesEstimated Uncollectible Interest and
PenaltiesDue from Other FundsDue from State
GovernmentInventory of SuppliesVouchers PayableTax
Anticipation Notes PayableDue to Other FundsDue to Federal
GovernmentDue to State GovernmentFund Balance—
Nonspendable—Inventory of SuppliesFund Balance—
Restricted—General GovernmentFund Balance—Restricted—
Public SafetyFund Balance—Restricted—Public WorksFund
Balance—Restricted—Health and WelfareFund Balance—
Restricted—Culture and RecreationFund Balance—
Committed—General GovernmentFund Balance—Committed—
Public SafetyFund Balance—Committed—Public WorksFund
Balance—Committed—Health and WelfareFund Balance—
Committed—Culture and RecreationFund Balance—Assigned—
General GovernmentFund Balance—Assigned—Public
SafetyFund Balance—Assigned—Public WorksFund Balance—
Assigned—Health and WelfareFund Balance—Assigned—
Culture and RecreationFund Balance—UnassignedBudgetary
Fund BalanceEncumbrances OutstandingEstimated
RevenuesRevenuesAppropriationsEstimated Other Financing
Uses—Interfund Transfers OutExpendituresOther Financing

2. Uses—Interfund Transfers Out
Chapter 2
(2-13)
Loss Caryrback and
Canliforward
Financial Statements, Cash Flow, and Taxes
Rhodes Corporation: Income Statements for Year Ending
December 31
(Millions of Dollars)
2013
87
2012
Sales
Operating costs excluding depreciation
Depreciation and amortization
Earnings before interest and taxes
Less interest
Pre-ta:i income
Taxes (40%)

3. Net income availabie to common stockhoiders
Common dividends
$ I i,000
9,360
J6(.t
$ 1,260
0a
$ i,i40
456
$_684
$ zza
s 10,000
8,500
360
$ 1,140
100
$ 1,040
416
$ az+
$ zoo

4. Rhodes Corporation: Balance Sheets as of December 31
(Millions of Dollars)
2013 2012
A-s.sefs
Cash
Short-term investments
Accounts receivable
Inventories
Total current assets
Net plant and equipment
Total assets
Liabilities and Equity
Accounts payable
Accruals
Notes payable
'l'otal current liabilities
Long-term debt
Total Iiabilities
Common stock
Retained earnings

5. Total common equity
Total liabilities and equity
$ s50
il0
2,750
1,650
$5,060
3,850
$8,elq
$1,100
550
384
$2,A34
1,100
$3,134
4,312
t,464
$s,776

6. $sels
$ s00
100
2,50A
1,500
$4,600
3,500
$8,100
$1,000
500
200
$1,700
1,000
$2,700
4,400
1,000
$5,400
$ergs
The Boo}binder Company has made $150,000 before taxes

7. during each of the last 15 years,
and it expects to make $150,000 a year before taxes in the
future. However, in 2013 the firm
incurred a loss of $650,000. The firm will claim a tax credit at
the time it files its 2013
income tax return, and it will receive a check from the U.S.
Treasury. Show how it calculates
this credit, and then indicate the flrm's tax liability for each of
the next 5 years. Assume a
4OVo tax rate on all income to ease the calculations.
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Part I The Cornpanv and Its En.,,ironment
Ratio
uzzanoCurrent
^rr.tr/C
Days saies outstanding (3d5-day year)
COGS/Inventory

11. Sales/Fixed assets
Sales/Total assets
Net income/Sales
Net income/Total assets
Net income/Common equity
Total debt/Total assets
Total liabilities/Total assets
Accounts receit able
Inventories
Total current assets
Fixed assets
Total assets
Liabilities and Equity
Accounts payable
Notes payable
Accruals
Total current liabiiities
Long-tenn debt
Common stock
Retained earnings
Total liabilities and equity
Jimenez Corporation: Forecasted Income Statement for 2014
Sales
Cost of goods sold
Selling general, and administrative expenses
Depreciation and amortization
Earnings before taxes (EBT)

12. Ta-xes (40%)
Net income
The /imenez Corporation s-forecasred rorn orr*]orIrI-.nts fo,ow,
"r"r*T;lir"rr.
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l|..#*y
average dara, and .o*."r, bri'Ry o,_, ]imenez,s pro;..r.a
srrengrhs and
Jimenez corporation; Forecasted Baiance sheet as of December
3.J., 201.4
Assets
Cash
$ 72,000
439,}aa
894,000
$ 1,405,000
43 t .000
$ r,836.000
-
$ 332.000
100,000
170,000

13. $ 602,000
404,290
575,000
254,710
$ 1,836,099
2.0
35.0 days
6.7
12.1
3.0
I AO,t.z/o
3.60/o
9.0o/o
3A.}Yo
{3_14)
Comprehensive Rado
Analysis
$4,290,000
3,580,000

14. 37032A
159.000
$ 180,680
72,272
$ tos.+oe*-
I
I
I
Disributed by Grand Canyon UnivenitJ
Chapter 3
t3-12)
Comprehensive Ratio
Calculations
(3"13)
Comprehensive Ratio
Analysis
Analysis of Financial Statements
Total assets turnover: 1.5
Gross profit margin on sales:
Total liabilities-to-assets ratio:

15. Quick ratio: 0.80
Days sales outstanding (based
lnventory turnover ratio: 3.75
(Sales - Cost of goods sold)/Sales =
40o/o
on 365-day year): 36.5 days
25Yo
Partial lncome
Sales
Cost of goods sold
Balance Sheet
Cash
Accounts receivable
Inventories
Fixed assets
Total assets
Cash
Receivables
Inventories

16. Total current assets
Net fi-xed assets
Total assets
Statement
lnformation
$ 22s,000
1,575,000
1,125,000
$2,950,000
1,350,000
Accounts payable
Long-term debt
Common stock
Retained earnings
Total liabilities and equity
Accounts payable
Notes payable
Other current liabilities
Totai current liabilities

17. Long-term debt
Common equi$r
Total liabilities and equily
50,000
100,000
$1qgqgq
The Kretovich Company had a quick ratio of 1.4, a current ratio
of 3.0, a days sales
outstanding of 36.5 days (based on a 365-day year), total
current assets of $810,000, and
cash and marketable securities of $120,000. What were
Kretovich's annual sales?
Data for Lozano Chip Company and its industry averages
follow.
a. Calculate the indicated ratios for Lozano.
b. Construct the extended Du Pont equation for bo& Lozano and
the industry.
c. Outline Lozano's strengths and weaknesses as revealed by
your analysis.
Lozano Chip Cornpany: Baiance Sheet as of December 3!,2A73
(Thousands
of Dollars)
$ 601,866
326,634

18. s25,000
$1,453,500
1,068,750
t,752,750
_q4?s,ggq
Lozano Chip Company: Income Statement for Year Ended
December 37,2013
(fhousands of Dollars)
$4,27s,999
Sales
Cost of goods sold
Selling, general, and administrative expenses
Earnings before interest and taxes (EBIT)
Interest expense
Earnings before taxes (EIIT)
Federal and state income taxes (40%)
Net income
$ 7,s00,000
6,375,000
825,000

19. $ 300,000
11 1,631
$ 188,359
75,348
9__tL3,022
2-4) Talbot Enterprises recently reported an EBITDA of $8
million and net income of $2.4 million. It had $2.0 million of
interest expense, and its corporate tax rate was 40%. What was
its charge for depreciation and amortization?
(2-11) The Berndt Corporation expects to have sales of $12
million. Costs other than depreciation are expected to be 75% of
sales, and depreciation is expected to be $1.5 million. All sales
revenues will be collected in cash, and costs other than
depreciation must be paid for during the year. Berndt’s federal-
plus-state tax rate is 40%. Berndt has no debt.
a. Set up an income statement. What is Berndt’s expected net
cash flow?
b. Suppose Congress changed the tax laws so that Berndt’s
depreciation expenses
doubled. No changes in operations occurred. What would
happen to reported profit and to net cash flow?
c. Now suppose that Congress changed the tax laws such that,
instead of doubling Berndt’s depreciation, it was reduced by
50%. How would profit and net cash flow be affected?
d. If this were your company, would you prefer Congress to
cause your depreciation expense to be doubled or halved? Why?
(2-12) Using Rhodes Corporation’s financial statements (shown
below), answer the following questions.
a. What is the net operating profit after taxes (NOPAT) for

20. 2013?
b. What are the amounts of net operating working capital for
both years?
c. What are the amounts of total net operating capital for both
years?
d. What is the free cash flow for 2013?
e. What is the ROIC for 2013?
f. How much of the FCF did Rhodes use for each of the
following purposes: after-tax interest, net debt repayments,
dividends, net stock repurchases, and net purchases of short-
term investments? (Hint: Remember that a net use can be
negative.)
3-1) Greene Sisters has a DSO of 20 days. The company’s
average daily sales are $20,000. What is the level of its
accounts receivable? Assume there are 365 days in a year.
(3-6) Gardial & Son has an ROA of 12%, a 5% profit margin,
and a return on equity equal to 20%. What is the company’s
total assets turnover? What is the firm’s equity multiplier?
(3-7) Ace Industries has current assets equal to $3 million. The
company’s current ratio is 1.5, and its quick ratio is 1.0. What
is the firm’s level of current liabilities? What is the firm’s level
of inventories?
(3-8) Assume you are given the following relationships for the
Haslam Corporation:
Sales/total assets 1.2
Return on assets (ROA) 4%
Return on equity (ROE) 7%
Calculate Haslam’s profit margin and liabilities-to-assets ratio.
Suppose half its liabilities are in the form of debt. Calculate the
debt-to-assets ratio.
(3-12) The Kretovich Company had a quick ratio of 1.4, a
current ratio of 3.0, a days sales outstanding of 36.5 days (based
on a 365-day year), total current assets of $810,000, and cash

21. and marketable securities of $120,000. What were Kretovich’s
annual sales?
Please see attached document for problems 3-13 & 3-14