ChapterTool KitChapter 211/20/18Financial Statements, Cash Flow, and Taxes2-1 Financial Statements and ReportsThe annual report contains a verbal section plus four key statements: the balance sheet, income statement, statement of stockholders' equity, and statement of cash flows.Our spreadsheets use formulas rather than fixed numbers. For example, the cell for Total assets for the most recent year contains the Sum formula rather than just a fixed number. That way, if the data for any inputs (cash, for instance) change, the spreadsheet will automatically recalculate and provide the correct new value for Total assets.In financial modeling, it is helpful to users when input data is grouped together, so you should follow this practice in your own models, too.2-2 The Balance SheetINPUT DATA SECTION: Historical Data Used in the Analysis20192018Tax rate25%25%Weighted average cost of captal (WACC)11.50%11.50%Figure 2-1MicroDrive Inc. December 31 Balance SheetsOlder version in manuscript 4/20(Millions of Dollars)Assets20192018Assets20192018Cash and equivalents$100$110Cash and equivalents$100$102Short-term investments10182Short-term investments1040Accounts receivable500410Accounts receivable500384Inventories1,000830Inventories1,000774Total current assets$1,610$1,532Total current assets$1,610$1,300Net plant and equipment2,0001,780Net property, plant, and equipment (PP&E)2,0001,780Note: Net plant and equipment is equal to cumulative purchases of fixed assets less cumulative depreciation and cumulative disposed assets. Total assets$3,610$3,312Total assets$3,610$3,080Liabilities and EquityLiabilities and EquityAccounts payable$200$190Accounts payable$200$180Notes payable150100Notes payable15028Accruals400370Accruals400370Total current liabilities$750$660Total current liabilities$750$578Long-term bonds520500Long-term bonds520350Total liabilities$1,270$1,160Total liabilities$1,270$928Preferred stock (1,000,000 shares)100100Preferred stock (1,000,000 shares)100100Common stock (50,000,000 shares)500500Common stock (50,000,000 shares)500500Retained earnings1,7401,552Retained earnings1,7401,552Total common equity$2,240$2,052Total common equity$2,240$2,052Total liabilities and equity$3,610$3,312Total liabilities and equity$3,610$3,0802-2 The Income StatementFigure 2-2MicroDrive Income Statements (and Selected Additional Information) for Years Ending December 31(Millions, Except for Per Share Data)20192018Older version in manuscript 4/20Net sales$5,000$4,800Net sales50004680Costs of goods sold except depreciation3,9003,710Costs of goods sold except depreciation$3,900$3,618Depreciation and amortizationa200180Depreciation and amortizationa200180Other operating expenses500470Other operating expenses500470Earnings before interest and taxes (EBIT)$400$440Earnings before interest and taxes (EBIT)400412Less interest 6040Less interest $60$56Pre-tax earnings$340$400Pre-tax earnings340356Taxes85100Taxes$85$89Net Income before preferred dividends$255$300Net Income before ...
ChapterTool KitChapter 14112118Distributions to Shareholders DiJinElias52
ChapterTool KitChapter 1411/21/18Distributions to Shareholders: Dividends and Repurchases14-2 Procedures for Cash DistributionsDeclaration date:Thursday, November 21, 2019Dividend goes with stock:Tuesday, December 17, 2019Ex-dividend date:Wednesday, December 18, 2019Thursday, December 19, 2019Holder-of-record date:Friday, December 20, 2019Payment date:Friday, January 10, 202014-7 Setting the Target Distribution Level: The Residual Distribution ModelThe optimal distribution ratio for a firm is a function of four factors. (1) Investors' preferences for dividends versus capital gains. (2) The firm's investment opportunities. (3) Its target capital structure. And (4), the availability and cost of external capital.The last three elements can be combined into the residual distribution model. Within the residual model, firms must determine the optimal capital budget, determine the amount of equity needed to fund the capital budget (based upon the target capital structure), use reinvested earnings to meet equity requirements whenever possible, and make distributions to shareholders only if more earnings are available than are needed for dividends. The residual model can be expressed as:Distributions =Net Income - [(Target equity ratio) * (Total capital budget)]Consider a firm whose net income for the current year is $100 million, their target equity ratio is 60%, and the expected capital budget is $50 million. What are its distributions to be made to shareholders, according to the residual model? Net Income$100Target equity ratio60%Total capital budget$50Distributions =Net Income - [(Target equity ratio) * (Total capital budget)]=$100-60%*$50=$70Distribution =70.0%What if the expected capital budget rose to $166.67 million?Total capital budget$166.67Distributions = =Net Income - [(Target equity ratio) * (Total capital budget)] =$100-60%*$167 =$0Distribution =0.0%The firm could not have a negative dividend, so a negative distribution must be a stock issue rather than a stock repurchase. Under the residual policy, if investment opportunities exceed net income, the firm should pay zero dividends and issue stock (or else increase its debt ratio to fund the investment opportunities).T&W's Distribution RatioNet income =$60Target equity ratio (ws) =60%PoorAverageGoodCapital budget$40$70$150Required equity (ws X Capital budget)$24$42$90Net income$60$60$60Required equity (ws X Capital budget)$24$42$90Distributions paid (NI – Required equity)$36$18−$30Note: a negative distribution means T&W would pay no dividends but would issue stock.Distribution ratio (Dividend/NI)60%30%0%14-9 A Tale of Two Cash Distributions: Dividends versus Stock RepurchasesFigure 14-1Projecting Benson Conglomerate's Financial Statements: Distributions as Dividends (Millions of Dollars)1. InputsActualProjected12/31/192020202120222023Sales growth rate5%5%5%5%Costs / Sales75.00%75.00%75.00%75.00%75.00%Depreciation / Net PPE10.00%10.00%10.00%10.00%10.00%Cas ...
This document provides financial information for ColdFront, including income statements, balance sheets, statements of cash flows, and ratio analyses for the years 2019, 2018, and 2017. Key highlights include ColdFront experiencing a significant increase in net income and earnings per share in 2019 compared to previous years. Ratio analyses show improvements in return on equity and working capital in 2019 as well.
This document discusses fund analysis, cash flow analysis, and financial planning. It provides examples of a flow of funds statement, sources and uses statement, balance sheet, income statement, and statement of cash flows for a company called Basket Wonders. It explains how to analyze and adjust these statements, such as recognizing depreciation, profits and dividends. It also compares the indirect and direct methods for preparing the statement of cash flows.
This chapter discusses key accounting statements used to analyze the financial performance and cash flows of a company. It includes:
1) The balance sheet, which provides a snapshot of assets, liabilities, and equity on a given date.
2) The income statement, which measures revenues and expenses over a period of time to determine net income.
3) The statement of cash flows, which reconciles cash flows from operating, investing, and financing activities to understand a company's actual cash position.
The document appears to be a multiple choice exam covering various topics in finance and accounting, including financial statements, cost behavior, capital structure, valuation, budgeting, and analysis. It contains 40 multiple choice questions testing understanding of concepts such as the balance sheet, fixed and variable costs, net present value, cash flow analysis, and accounting principles.
There are 76 red xxx’s – each worth 1.18 points. You only need to.docxchristalgrieg
There are 76 red xxx’s – each worth 1.18 points. You only need to fill in where you see red xxx’s (big or small)
CHAPTER 1
THE McGEE CAKE COMPANY
1. The advantages to a LLC are: xxxx
The biggest disadvantage is: xxxx
2. .xxxx
C-2 CASE SOLUTIONS
3. .xxxx
CHAPTER 2
CASH FLOWS AND FINANCIAL STATEMENTS
Below are the financial statements that you are asked to prepare.
1. The income statement for each year will look like this:
Income Statement
2010
2011
Sales
xxxx
xxxx
Cost of goods sold
163,849
206,886
Selling and administrative
xxxx
xxxx
Depreciation
46,255
52,282
EBIT
$79,110
$90,584
Interest
10,056
11,526
EBT
$69,054
$79,058
Taxes (use the problem to figure
This amount out
xxxx
xxxx
Net income
$55,243
$63,246
Dividends(read the case to find out how much this is)
xxxx
xxxx
Addition to retained earnings
(this would be whatever the net income is less the dividends paid out)
xxxx
xxxx
2. The balance sheet for each year will be:
Balance Sheet as of Dec. 31, 2010
Cash
xxxx
Accounts payable
xxxx
Accounts receivable
xxxx
Notes payable
xxxx
Inventory
xxxx
Current liabilities
$60,832
Current assets
$72,651
Long-term debt
xxxxx
Net fixed assets
xxxxxx
Owners' equity
xxxxx
Total assets
$276,719
Total liab. and equity
$276,719
In the first year, equity is not given. Therefore, we must calculate equity as a plug variable. Since total liabilities and equity is equal to total assets, equity can be calculated as:
Equity = $276,719 – 60,832 – 103,006
Equity = $112,881
Balance Sheet as of Dec. 31, 2011
Cash
xxxx
Accounts payable
xxxx
Accounts receivable
xxxx
Notes payable
xxxx
Inventory
xxxx
Current liabilities
$68,121
Current assets
$100,834
Long-term debt
xxxx
Net fixed assets
xxxx
Owners' equity
Xxxx(see below)
Total assets
$349,459
Total liab. and equity
$349,459
The owner’s equity for 2011 is the beginning of year owner’s equity, plus the addition to retained earnings, plus the new equity, so:
Equity = $112,881 + 31,623 + 20,500
Equity = $165,004
3-6 are completed for you so you can answer the questions
3. Using the OCF equation: (
OCF = EBIT + Depreciation – Taxes
The OCF for each year is:
OCF2010 = $79,110 + 46,255 – 13,811
OCF2010 = $111,554
OCF2011 = $90,584 + 52,282 – 15,812
OCF2011 = $127,054
4.
To calculate the cash flow from assets, we need to find the capital spending and change in net working capital. The capital spending for the year was:
Capital spending
Ending net fixed assets
$248,625
– Beginning net fixed assets
204,068
+ Depreciation
52,282
Net capital spending
$96,839
And the change in net working capital was:
Change in net working capital
Ending NWC
$32,713
– Beginning NWC
11,819
Change in NWC
$20,894
So, the cash flow from assets was:
Cash flow from assets
Operating cash flow
$127,054
– Net capital spending
96,839
– Change in NWC
...
ChapterTool KitChapter 1212912Corporate Valuation and Financial .docxtiffanyd4
ChapterTool KitChapter 1212/9/12Corporate Valuation and Financial Planning12-2 Financial Planning at MicroDrive, Inc.The process used by MicroDrive to forecast the free cash flows from its operating plan is described in the sections below.Setting Up the Model to Forecast OperationsWe begin with MicroDrive's most recent financial statements and selected additional data.Figure 12-1 MicroDrive’s Most Recent Financial Statements (Millions, Except for Per Share Data)INCOME STATEMENTSBALANCE SHEETS20122013Assets20122013Net sales$ 4,760$ 5,000Cash$ 60$ 50COGS (excl. depr.)3,5603,800ST Investments40-Depreciation170200Accounts receivable380500Other operating expenses480500Inventories8201,000EBIT$ 550$ 500Total CA$ 1,300$ 1,550Interest expense100120Net PP&E1,7002,000Pre-tax earnings$ 450$ 380Total assets$ 3,000$ 3,550Taxes (40%)180152NI before pref. div.$ 270$ 228Liabilities and equityPreferred div.88Accounts payable$ 190$ 200Net income$ 262$ 220Accruals280300Notes payable130280Other DataTotal CL$ 600$ 780Common dividends$48$50Long-term bonds1,0001,200Addition to RE$214$170Total liabilities$ 1,600$ 1,980Tax rate40%40%Preferred stock100100Shares of common stock5050Common stock500500Earnings per share$5.24$4.40Retained earnings800970Dividends per share$0.96$1.00Total common equity$ 1,300$ 1,470Price per share$40.00$27.00Total liabs. & equity$ 3,000$ 3,550The figure below shows all the inputs required to project the financial statements for the scenario that has been selected with the Scenario Manager: Data, What-If Analysis, Scenario Manager. There are two scenarios. The first is named Status Quo because all operating ratios except the sales growth rate are assumed to remain unchanged. The initial sales growth rate was chosen by MicroDrive's managers based on the existing product lines. The growth rate declines over time until it eventually levels off at a sustainable rate. The other scenario is named Final because it is the set of inputs chosen by MicroDrive's management team.Section 1 shows the inputs required to estimate the items in an operating plan. For each of these inputs, Section 1 shows the industry averages, the actual values for the past two years for MicroDrive, and the forecasted values for the next five years. The managers assumed the inputs for future years (except the sales growth rate) would be equal to the inputs in the first projected year.MicroDrive's managers assume that sales will eventually level off at a sustaniable constant rate.Sections 2 and 3 show the data required to estimate the weighted average cost of capital. Section 4 shows the forecasted growth rate in dividends.Note: These inputs are linked throughout the model. If you want to change an input, do it here and not other places in the model.Figure 12-2MicroDrive's Forecast: Inputs for the Selected ScenarioStatus QuoIndustryMicroDriveMicroDriveInputsActualActualForecast1. Operating Ratios2013201220132014201520162017201.
Magic Blades stock has risen rapidly to $50 per share. Th.docxsmile790243
Magic Blade's stock has risen rapidly to $50 per share. The increase is due to excitement about its new knife
that uses a light beam to slice fruits and vegetables. This process enhances the final appearance and quality
of salads and fruit trays.
The board of directors is considering strategies to divide the corporate ownership into more shares of stock,
and bring about some reduction in the price per share. They are considering a stock split, small stock dividend,
or large stock dividend. The board is unsure of the accounting effects of such transactions, and has requested
information about how stockholders' equity would be impacted.
Prior to the contemplated stock transaction, equity consisted of:
Stockholders’ Equity
Common stock, $2 par value, 2,000,000 shares authorized,
500,000 shares issued and outstanding $1,000,000
Paid-in capital in excess of par 2,000,000
Retained earnings 6,000,000
Total stockholders’ equity $9,000,000
(a) Assuming the board were to declare a 2 for 1 split, how would the revised stockholders' equity
appear?
(b) Assuming the board were to declare a 15% stock dividend, how would the revised stockholders'
equity appear?
B-14.07 Stock dividends and splits
x
SPREADSHEET
TOOL:
Holding a
cell reference
constant
Mike
Highlight
Summary information for Branford Corporation's balance sheet follows:
BRANFORD CORPORATION
Balance Sheet
August 15, 20X4
Assets
Cash $ 125,000
Accounts receivable 250,000
Inventory 750,000
Property, plant, & equipment (net) 860,000
Total assets $1,985,000
Liabilities
Accounts payable $125,000
Accrued liabilities 260,000
Notes payable 290,000
Total liabilities $ 675,000
Stockholders’ equity
Common stock, $5 par $700,000
Paid-in capital in excess of par 300,000
Retained earnings 310,000
Total stockholders’ equity 1,310,000
Total liabilities and equity $1,985,000
Branford's business is growing rapidly, and the company needs to expand its manufacturing facilities. This
expansion will require the company to obtain an additional $1,000,000 in cash. The company is exploring
five alternatives to obtain the necessary capital:
Equity structure and impact I-14.01
Mike
Highlight
366 | CHAPTER 14
DEBT OPTION:
Branford is able to borrow, on a 5-year note, the full amount needed. The interest rate on
this note would be 7%, and the note would require monthly payments.
COMMON STOCK OPTION:
Branford has identified an investor who is willing to pay $1,000,000 for 40,000 newly is-
sued common shares. Common shares have been paying a dividend of $0.50 per share.
Branford anticipates that this dividend rate will be maintained.
NONCUMULATIVE PREFERRED STOCK OPTION:
Branford has identified a hedge fund that will pay $1,000,000 for 8% noncumulative
preferred stock to be issued at par.
CUMULATIVE PREFERRED STOCK OPTION:
Branford has identified an insurance company that will pay $1,000,000 for 6% cumulative
preferred ...
ChapterTool KitChapter 14112118Distributions to Shareholders DiJinElias52
ChapterTool KitChapter 1411/21/18Distributions to Shareholders: Dividends and Repurchases14-2 Procedures for Cash DistributionsDeclaration date:Thursday, November 21, 2019Dividend goes with stock:Tuesday, December 17, 2019Ex-dividend date:Wednesday, December 18, 2019Thursday, December 19, 2019Holder-of-record date:Friday, December 20, 2019Payment date:Friday, January 10, 202014-7 Setting the Target Distribution Level: The Residual Distribution ModelThe optimal distribution ratio for a firm is a function of four factors. (1) Investors' preferences for dividends versus capital gains. (2) The firm's investment opportunities. (3) Its target capital structure. And (4), the availability and cost of external capital.The last three elements can be combined into the residual distribution model. Within the residual model, firms must determine the optimal capital budget, determine the amount of equity needed to fund the capital budget (based upon the target capital structure), use reinvested earnings to meet equity requirements whenever possible, and make distributions to shareholders only if more earnings are available than are needed for dividends. The residual model can be expressed as:Distributions =Net Income - [(Target equity ratio) * (Total capital budget)]Consider a firm whose net income for the current year is $100 million, their target equity ratio is 60%, and the expected capital budget is $50 million. What are its distributions to be made to shareholders, according to the residual model? Net Income$100Target equity ratio60%Total capital budget$50Distributions =Net Income - [(Target equity ratio) * (Total capital budget)]=$100-60%*$50=$70Distribution =70.0%What if the expected capital budget rose to $166.67 million?Total capital budget$166.67Distributions = =Net Income - [(Target equity ratio) * (Total capital budget)] =$100-60%*$167 =$0Distribution =0.0%The firm could not have a negative dividend, so a negative distribution must be a stock issue rather than a stock repurchase. Under the residual policy, if investment opportunities exceed net income, the firm should pay zero dividends and issue stock (or else increase its debt ratio to fund the investment opportunities).T&W's Distribution RatioNet income =$60Target equity ratio (ws) =60%PoorAverageGoodCapital budget$40$70$150Required equity (ws X Capital budget)$24$42$90Net income$60$60$60Required equity (ws X Capital budget)$24$42$90Distributions paid (NI – Required equity)$36$18−$30Note: a negative distribution means T&W would pay no dividends but would issue stock.Distribution ratio (Dividend/NI)60%30%0%14-9 A Tale of Two Cash Distributions: Dividends versus Stock RepurchasesFigure 14-1Projecting Benson Conglomerate's Financial Statements: Distributions as Dividends (Millions of Dollars)1. InputsActualProjected12/31/192020202120222023Sales growth rate5%5%5%5%Costs / Sales75.00%75.00%75.00%75.00%75.00%Depreciation / Net PPE10.00%10.00%10.00%10.00%10.00%Cas ...
This document provides financial information for ColdFront, including income statements, balance sheets, statements of cash flows, and ratio analyses for the years 2019, 2018, and 2017. Key highlights include ColdFront experiencing a significant increase in net income and earnings per share in 2019 compared to previous years. Ratio analyses show improvements in return on equity and working capital in 2019 as well.
This document discusses fund analysis, cash flow analysis, and financial planning. It provides examples of a flow of funds statement, sources and uses statement, balance sheet, income statement, and statement of cash flows for a company called Basket Wonders. It explains how to analyze and adjust these statements, such as recognizing depreciation, profits and dividends. It also compares the indirect and direct methods for preparing the statement of cash flows.
This chapter discusses key accounting statements used to analyze the financial performance and cash flows of a company. It includes:
1) The balance sheet, which provides a snapshot of assets, liabilities, and equity on a given date.
2) The income statement, which measures revenues and expenses over a period of time to determine net income.
3) The statement of cash flows, which reconciles cash flows from operating, investing, and financing activities to understand a company's actual cash position.
The document appears to be a multiple choice exam covering various topics in finance and accounting, including financial statements, cost behavior, capital structure, valuation, budgeting, and analysis. It contains 40 multiple choice questions testing understanding of concepts such as the balance sheet, fixed and variable costs, net present value, cash flow analysis, and accounting principles.
There are 76 red xxx’s – each worth 1.18 points. You only need to.docxchristalgrieg
There are 76 red xxx’s – each worth 1.18 points. You only need to fill in where you see red xxx’s (big or small)
CHAPTER 1
THE McGEE CAKE COMPANY
1. The advantages to a LLC are: xxxx
The biggest disadvantage is: xxxx
2. .xxxx
C-2 CASE SOLUTIONS
3. .xxxx
CHAPTER 2
CASH FLOWS AND FINANCIAL STATEMENTS
Below are the financial statements that you are asked to prepare.
1. The income statement for each year will look like this:
Income Statement
2010
2011
Sales
xxxx
xxxx
Cost of goods sold
163,849
206,886
Selling and administrative
xxxx
xxxx
Depreciation
46,255
52,282
EBIT
$79,110
$90,584
Interest
10,056
11,526
EBT
$69,054
$79,058
Taxes (use the problem to figure
This amount out
xxxx
xxxx
Net income
$55,243
$63,246
Dividends(read the case to find out how much this is)
xxxx
xxxx
Addition to retained earnings
(this would be whatever the net income is less the dividends paid out)
xxxx
xxxx
2. The balance sheet for each year will be:
Balance Sheet as of Dec. 31, 2010
Cash
xxxx
Accounts payable
xxxx
Accounts receivable
xxxx
Notes payable
xxxx
Inventory
xxxx
Current liabilities
$60,832
Current assets
$72,651
Long-term debt
xxxxx
Net fixed assets
xxxxxx
Owners' equity
xxxxx
Total assets
$276,719
Total liab. and equity
$276,719
In the first year, equity is not given. Therefore, we must calculate equity as a plug variable. Since total liabilities and equity is equal to total assets, equity can be calculated as:
Equity = $276,719 – 60,832 – 103,006
Equity = $112,881
Balance Sheet as of Dec. 31, 2011
Cash
xxxx
Accounts payable
xxxx
Accounts receivable
xxxx
Notes payable
xxxx
Inventory
xxxx
Current liabilities
$68,121
Current assets
$100,834
Long-term debt
xxxx
Net fixed assets
xxxx
Owners' equity
Xxxx(see below)
Total assets
$349,459
Total liab. and equity
$349,459
The owner’s equity for 2011 is the beginning of year owner’s equity, plus the addition to retained earnings, plus the new equity, so:
Equity = $112,881 + 31,623 + 20,500
Equity = $165,004
3-6 are completed for you so you can answer the questions
3. Using the OCF equation: (
OCF = EBIT + Depreciation – Taxes
The OCF for each year is:
OCF2010 = $79,110 + 46,255 – 13,811
OCF2010 = $111,554
OCF2011 = $90,584 + 52,282 – 15,812
OCF2011 = $127,054
4.
To calculate the cash flow from assets, we need to find the capital spending and change in net working capital. The capital spending for the year was:
Capital spending
Ending net fixed assets
$248,625
– Beginning net fixed assets
204,068
+ Depreciation
52,282
Net capital spending
$96,839
And the change in net working capital was:
Change in net working capital
Ending NWC
$32,713
– Beginning NWC
11,819
Change in NWC
$20,894
So, the cash flow from assets was:
Cash flow from assets
Operating cash flow
$127,054
– Net capital spending
96,839
– Change in NWC
...
ChapterTool KitChapter 1212912Corporate Valuation and Financial .docxtiffanyd4
ChapterTool KitChapter 1212/9/12Corporate Valuation and Financial Planning12-2 Financial Planning at MicroDrive, Inc.The process used by MicroDrive to forecast the free cash flows from its operating plan is described in the sections below.Setting Up the Model to Forecast OperationsWe begin with MicroDrive's most recent financial statements and selected additional data.Figure 12-1 MicroDrive’s Most Recent Financial Statements (Millions, Except for Per Share Data)INCOME STATEMENTSBALANCE SHEETS20122013Assets20122013Net sales$ 4,760$ 5,000Cash$ 60$ 50COGS (excl. depr.)3,5603,800ST Investments40-Depreciation170200Accounts receivable380500Other operating expenses480500Inventories8201,000EBIT$ 550$ 500Total CA$ 1,300$ 1,550Interest expense100120Net PP&E1,7002,000Pre-tax earnings$ 450$ 380Total assets$ 3,000$ 3,550Taxes (40%)180152NI before pref. div.$ 270$ 228Liabilities and equityPreferred div.88Accounts payable$ 190$ 200Net income$ 262$ 220Accruals280300Notes payable130280Other DataTotal CL$ 600$ 780Common dividends$48$50Long-term bonds1,0001,200Addition to RE$214$170Total liabilities$ 1,600$ 1,980Tax rate40%40%Preferred stock100100Shares of common stock5050Common stock500500Earnings per share$5.24$4.40Retained earnings800970Dividends per share$0.96$1.00Total common equity$ 1,300$ 1,470Price per share$40.00$27.00Total liabs. & equity$ 3,000$ 3,550The figure below shows all the inputs required to project the financial statements for the scenario that has been selected with the Scenario Manager: Data, What-If Analysis, Scenario Manager. There are two scenarios. The first is named Status Quo because all operating ratios except the sales growth rate are assumed to remain unchanged. The initial sales growth rate was chosen by MicroDrive's managers based on the existing product lines. The growth rate declines over time until it eventually levels off at a sustainable rate. The other scenario is named Final because it is the set of inputs chosen by MicroDrive's management team.Section 1 shows the inputs required to estimate the items in an operating plan. For each of these inputs, Section 1 shows the industry averages, the actual values for the past two years for MicroDrive, and the forecasted values for the next five years. The managers assumed the inputs for future years (except the sales growth rate) would be equal to the inputs in the first projected year.MicroDrive's managers assume that sales will eventually level off at a sustaniable constant rate.Sections 2 and 3 show the data required to estimate the weighted average cost of capital. Section 4 shows the forecasted growth rate in dividends.Note: These inputs are linked throughout the model. If you want to change an input, do it here and not other places in the model.Figure 12-2MicroDrive's Forecast: Inputs for the Selected ScenarioStatus QuoIndustryMicroDriveMicroDriveInputsActualActualForecast1. Operating Ratios2013201220132014201520162017201.
Magic Blades stock has risen rapidly to $50 per share. Th.docxsmile790243
Magic Blade's stock has risen rapidly to $50 per share. The increase is due to excitement about its new knife
that uses a light beam to slice fruits and vegetables. This process enhances the final appearance and quality
of salads and fruit trays.
The board of directors is considering strategies to divide the corporate ownership into more shares of stock,
and bring about some reduction in the price per share. They are considering a stock split, small stock dividend,
or large stock dividend. The board is unsure of the accounting effects of such transactions, and has requested
information about how stockholders' equity would be impacted.
Prior to the contemplated stock transaction, equity consisted of:
Stockholders’ Equity
Common stock, $2 par value, 2,000,000 shares authorized,
500,000 shares issued and outstanding $1,000,000
Paid-in capital in excess of par 2,000,000
Retained earnings 6,000,000
Total stockholders’ equity $9,000,000
(a) Assuming the board were to declare a 2 for 1 split, how would the revised stockholders' equity
appear?
(b) Assuming the board were to declare a 15% stock dividend, how would the revised stockholders'
equity appear?
B-14.07 Stock dividends and splits
x
SPREADSHEET
TOOL:
Holding a
cell reference
constant
Mike
Highlight
Summary information for Branford Corporation's balance sheet follows:
BRANFORD CORPORATION
Balance Sheet
August 15, 20X4
Assets
Cash $ 125,000
Accounts receivable 250,000
Inventory 750,000
Property, plant, & equipment (net) 860,000
Total assets $1,985,000
Liabilities
Accounts payable $125,000
Accrued liabilities 260,000
Notes payable 290,000
Total liabilities $ 675,000
Stockholders’ equity
Common stock, $5 par $700,000
Paid-in capital in excess of par 300,000
Retained earnings 310,000
Total stockholders’ equity 1,310,000
Total liabilities and equity $1,985,000
Branford's business is growing rapidly, and the company needs to expand its manufacturing facilities. This
expansion will require the company to obtain an additional $1,000,000 in cash. The company is exploring
five alternatives to obtain the necessary capital:
Equity structure and impact I-14.01
Mike
Highlight
366 | CHAPTER 14
DEBT OPTION:
Branford is able to borrow, on a 5-year note, the full amount needed. The interest rate on
this note would be 7%, and the note would require monthly payments.
COMMON STOCK OPTION:
Branford has identified an investor who is willing to pay $1,000,000 for 40,000 newly is-
sued common shares. Common shares have been paying a dividend of $0.50 per share.
Branford anticipates that this dividend rate will be maintained.
NONCUMULATIVE PREFERRED STOCK OPTION:
Branford has identified a hedge fund that will pay $1,000,000 for 8% noncumulative
preferred stock to be issued at par.
CUMULATIVE PREFERRED STOCK OPTION:
Branford has identified an insurance company that will pay $1,000,000 for 6% cumulative
preferred ...
China Cord Blood Corp (NYSE: CO) and Golden Meditech (801 HK)asianextractor
1. The document analyzes financial and operating data from China Cord Blood Corp and finds inconsistencies that raise doubts about the accuracy of the reported numbers.
2. It notes a sudden spike in revenue and profits per new subscriber in 2013 that coincided with a large increase in prepayments, as well as dramatic rises in deferred income as a percentage of revenue in subsequent years.
3. The operating data shows each new subscriber contributing significantly more to unearned storage fees and deferred income between 2012-2015 despite no reported change in storage fee policies. This suggests the financial and operating data do not match.
This document contains 5 multiple choice questions regarding financial statements and ratios. Question 1 asks which statement about a profitable firm's stock price is typically correct. Question 2 asks which statement correctly describes what is shown on the statement of cash flows. Question 3 asks which statement about the relationship between dividends paid and retained earnings is correct. Question 4 asks which statement could explain an increase in cash despite a negative net cash flow from operations. Question 5 provides financial information for a company and asks how much net income exceeded free cash flow.
This document contains 5 multiple choice questions related to financial accounting concepts. Question 1 asks which statement is correct regarding earnings per share (EPS) and dividends per share (DPS). Question 2 asks which statement is correct regarding the statement of cash flows. Question 3 asks which statement is correct regarding the income statement and balance sheet. Question 4 asks which statement could explain an increase in cash with a negative net cash flow. Question 5 provides financial information for a company and asks how much net income exceeded free cash flow.
The document provides the quarterly and annual financial results for a company. Some key highlights include:
- Several consumer brands posted sales growth for the quarter including Banquet, Blue Bonnet, and Chef Boyardee, while others like ACT II and Eckrich saw declines.
- Total depreciation and amortization was around $93 million for the quarter and $352 million for the fiscal year.
- Capital expenditures were around $106 million for the quarter and $352 million for the fiscal year.
- Net interest expense was $80 million for the quarter and $275 million for the fiscal year.
- Corporate expenses were around $95 million for the quarter and $342 million
The document discusses accounting statements and cash flow. It provides an overview of key statements including the balance sheet, income statement, and statement of cash flows. The balance sheet presents a company's assets, liabilities, and equity on a given date. The income statement measures performance over a period of time by reporting revenues and expenses. The statement of cash flows reconciles cash flows from operating, investing, and financing activities. Sample statements are presented for a company called U.S. Composite Corporation to illustrate the components and analysis of each.
Mini Case112018Chapter 2 Mini CaseSituationJenny Cochran, a grad.docxpauline234567
Mini Case11/20/18Chapter 2 Mini CaseSituationJenny Cochran, a graduate of The University of Tennessee with 4 years of experience as an equities analyst, was recently brought in as assistant to the chairman of the board of Computron Industries, a manufacturer of computer components.
During the previous year, Computron had doubled its plant capacity, opened new sales offices outside its home territory, and launched an expensive advertising campaign. Cochran was assigned to evaluate the impact of the changes. She began by gathering financial statements and other data.Computron's Balance Sheets (Millions of Dollars)20182019AssetsCash and equivalents$ 60$ 50Short-term investments10010Accounts receivable400520Inventories620820Total current assets$ 1,180$ 1,400Gross fixed assets$ 3,900$ 4,820Less: Accumulated depreciation1,0001,320Net fixed assets$ 2,900$ 3,500Total assets$ 4,080$ 4,900Liabilities and equityAccounts payable$ 300$ 400Notes payable50250Accruals200240Total current liabilities$ 550$ 890Long-term bonds8001,100Total liabilities$ 1,350$ 1,990Common stock1,0001,000Retained earnings1,7301,910Total equity$ 2,730$ 2,910Total liabilities and equity$ 4,080$ 4,900Computron's Income Statement (Millions of Dollars)20182019Net sales$ 5,500$ 6,000Cost of goods sold (Excluding depr. & amort.)4,3004,800Depreciation and amortizationa290320Other operating expenses350420Total operating costs$ 4,940$ 5,540Earnings before interest and taxes (EBIT)$ 560$ 460Less interest 68108Pre-tax earnings$ 492$ 352Taxes (25%)12388Net Income $ 369$ 264Notes:a Computron has no amortization charges.Other Data20182019Stock price$50.00$30.00Shares outstanding (millions)100100Common dividends (millions)$90$84Tax rate25%25%Weighted average cost of capital (WACC)10.00%10.00%Computron's Statement of Cash Flows (Millions of Dollars)
Bart Kreps: The statement of cash flows provides information about cash inflows and outflows during an accounting period.
2019Operating Activities Net Income before preferred dividends$ 264Noncash adjustments Depreciation and amortization320Due to changes in working capital Change in accounts receivable(120) Change in inventories(200) Change in accounts payable100 Change in accruals40Net cash provided by operating activities$ 404Investing activities Cash used to acquire fixed assets$ (920)
Bart Kreps: Make sure to add back annual Depreciation to Net PP&E.
Bart Kreps: The statement of cash flows provides information about cash inflows and outflows during an accounting period.
Change in short-term investments90Net cash provided by investing activities$ (830)Financing Activities Change in notes payable$ 200 Change in long-term debt300 Payment of cash dividends(84)Net cash provided by financing activities$ 416Net change in cash.
Carter is a small regional food producer whose specialty is high-q.docxjasoninnes20
Carter is a small regional food producer whose specialty is high-quality nut products sold in the snack foods market. The company decided in 2018 to undertake a major expansion and “go national” in competition with some major snack foods companies. The company believes that its products were of higher quality than its competitors and that this quality difference will enable it to charge a premium price which would lead to greatly increased sales, profits and stock price. The company double its plant capacity and undertaken a major marketing campaign in an attempt to “go national.” Thus far, sales have not been up to the forecasted level, costs have been higher than were projected, and a large loss occurred in 2019, rather than the expected profit. As a result, its managers, directors, and investors are concerned about the firm’s survival.
Joan Watson was brought in as assistant to John King, Johnson’s chairman, who had the task of getting the company back into a sound financial position. Carter’s 2018 and 2019 actual balance sheets and income statements, together with projections for 2020, are given in Tables 1 and 2. In addition, Table 3 gives the company’s 2018 and 2019 financial ratios, together with industry average data. The 2020 projected financial statement data represent the company’s best guess for 2020 results, assuming that some new financing is arranged to get the company “over the hump.”
Watson examined monthly data for 2019 (not given in the case), and she detected an improving pattern during the year. Monthly sales were rising, costs were falling, and large losses in the early months had turned to a small profit by December. Thus, the annual data look somewhat worse than final monthly data. Also, it appears to be taking longer for the advertising program to get the message out, for the new sales offices to generate sales, and for the new manufacturing facilities to operate efficiently. In other words, the lags between spending money and deriving benefits were longer than Carter’s managers had anticipated. For these reasons, the company see hope for the company—provided it can survive in the short run.
Watson must prepare an analysis of where the company is now, what it must do to regain its financial health, and what actions should be taken. Your assignment is to help her answer the following questions. Provide clear explanations, not yes or no answers.
Table 1.
Balance Sheets
2020E 2019 2018
Assets
Cash $ 85,632 $ 7,282 $ 57,600
Accounts receivable 878,000 632,160 351,200
Inventories 1,716,480 1,287,360 715,200
Total current assets $ 2,680,112 $ 1,926,802 $ 1,124,000
Gross fixed assets 1,197,160 1,202,950 491,000
Less accumulated depreciation 380,120 263,160 146,200
Net fixed assets $ 817,040$ 939,790$ 344,800
Total assets $ 3,497,152$ 2,866,592$ 1,468,800
Liab ...
John DeereOther Financial Information 2006 3rdfinance11
Deere & Company reported financial results for the nine months ended July 31, 2006. The document provides details on net sales, average identifiable assets, operating profit, and return on assets for the company's agricultural equipment, commercial and consumer equipment, and construction and forestry segments. It also provides financial data for the company's financial services segment, including net income, return on equity, and operating profit. Additionally, the document discusses Deere's use of Shareholder Value Added (SVA) as a performance metric, which measures pre-tax profit left over after subtracting the cost of capital. SVA is used for performance goals and determining some compensation.
The document discusses cash flow statements, including:
1) It compares cash flows from operating, investing, and financing activities and contrasts cash flow statements prepared under IFRS and US GAAP.
2) It distinguishes between the direct and indirect methods of presenting cash from operating activities.
3) It analyzes and interprets both reported and common-size cash flow statements, calculates performance and coverage cash flow ratios, and interprets free cash flow.
This property analysis report summarizes the key financial details of a single family rental property located in Any City, USA that was purchased for $35,000 with an 80% loan-to-value. Over the 10-year analysis period, the report projects the property will appreciate from $54,000 to $59,551 in value, while generating positive cash flow each year ranging from $2,514 to $4,519. The projected returns on investment range from 16.8% to 75.6% over the period.
John DeereOther Financial Information 2008 4thfinance11
Deere & Company reported financial results for the twelve months ended October 31, 2008. The document provides a breakdown of net sales, average identifiable assets, operating profit, operating return on assets, SVA cost of assets, and SVA for the company's agricultural equipment, commercial and consumer equipment, and construction and forestry segments. It also provides this financial data for the company's financial services segment, including net income, average equity, return on equity, operating profit, and SVA. The company uses a metric called Shareholder Value Added (SVA) to evaluate business performance, which is the pretax profit remaining after subtracting the cost of capital.
Ch02 P14 Build a Model Spring 1, 201372212Chapter 2. Ch 02 P14.docxarnit1
Joshua & White Technologies' financial statements for 2009 and 2010 are provided. The assistant is asked to analyze various ratios and perform common size and percentage change analyses to evaluate changes in the company's liquidity, asset management, profitability, and financial position between the two years. Specifically, the assistant calculates ratios such as the current ratio, inventory turnover, return on assets, and performs DuPont, common size, and percentage change analyses on the income statement, balance sheet, key line items, and ratios.
This document provides forward-looking statements and non-GAAP financial information for Monsanto's investor day on November 10, 2005. It includes reconciliations of free cash flow, non-GAAP EPS, and return on capital for fiscal years 2004-2007. The document also notes that references to fiscal years refer to Monsanto's year ending August 31 and lists several of Monsanto's trademarks.
1. The document summarizes key topics from Chapter 3 including financial statements, cash flows, taxes, and valuation metrics.
2. It provides examples of income statements, balance sheets, and statements of cash flows for a company that experienced high growth in 2007.
3. Several analyses are presented including calculations of free cash flow, return on invested capital, economic value added, and market value added, indicating the company's growth destroyed value as returns fell below the cost of capital.
Conversion worksheetGreen shaded cells are from Chapter 5 financia.docxmaxinesmith73660
Conversion worksheetGreen shaded cells are from Chapter 5 financial StatementsEnter all amounts as positive numbers. The worksheet is formatted to add debits to assets & expenses and add credits to revenues, liabilities & equityRefr. Account TitlesDebitsCreditsGov'tal Fund Balances Adjustments & EliminationsGovern-mental Funds AdjustedInternal Service FundsBalances for Gov't-wide StmtsDebitsCreditsDebitsCreditsAtype debit accounts in this columnDEBITS:type credit accounts in this columnCash830,320830,320830,320Cash with Fiscal Agent928,000928,000928,000Investments259,000259,000259,000Taxes Receivable, net274,000274,000274,000Interest Receivable, net16,85016,85016,850Inventories--Due from State Govt.580,000580,000580,000Due from Other Funds--Capital Assets-- both rows--Expenditures (expenses) Current- General Govt.1,646,9001,646,9001,646,900 Public Safety3,026,9003,026,9003,026,900 Highway and Streets2,471,9002,471,9002,471,900 Sanitation591,400591,400591,400 Health724,100724,100724,100 Welfare374,300374,300374,300 Culture and Recreation917,300917,300917,300Compensated Absences Exp--Other Expenditures (expenses)-- - Debt Service Principal800,000800,000800,000 - Interest (expenditure/expense)514,000514,000514,000 both rows - Capital Outlay5,798,1005,798,1005,798,100 - Depreciation--Other Fin. Uses - Transfers Out1,876,7001,876,7001,876,700-Total Debits21,629,77021,629,770CREDITS:Accounts Payable493,400493,400493,400Due to Other Funds40,20040,20040,200Accrued Interest Payable--Bonds Payalbe both rows--Premium on Bonds--Compensated Absence Payable--Advance from Water Utility Fund--Deferred Inflows: Property Taxes27,50027,50027,500Accumulated Depreciation both rows--Revenues-Property Taxes6,657,5006,657,5006,657,500Sales Taxes2,942,0002,942,0002,942,000Interest21,22021,22021,220Licenses & Permits800,000800,000800,000Miscellaneous350,000350,000350,000State Grant for Highway Street Expenses1,072,0001,072,0001,072,000Capital Grant- Gen Gov't332,000332,000332,000Capital Grant- Public Safety1,320,0001,320,0001,320,000----Other Financing Sources--Proceeds of Bonds4,000,0004,000,0004,000,000Premium on Bonds200,000200,000200,000Transfers In1,876,7001,876,7001,876,700Net Position at beginning of year- three rows1,497,2501,497,2501,497,250Total Credits21,629,77021,629,770column totals: debits = credits ??------
CITY OF MONROE
WORKSHEET TO CONVERT GOVERNMENTAL ACTIVITIES TO ACCRUAL BASIS
Stmt of ActivitiesProgram RevenuesNet (Expense) Revenue and Change in Net PositionExpensesCharges for ServicesOperational Grants and ContributionsCapital Grants and ContributionsGovernmental ActivitiesBusiness-Type ActivitiesTotalFunctions/ProgramsGovernmental Activities: General Government$ -$ - Public Safety-- Highways and Streets-- Sanitation-- Health-- Welfare-- Culture and Recreation-- Depreciaiton-- Interest-- Compensated Absneces-- Total Governmental Activities------Business Type Activi.
20180620 sauc oppenheimer consumer conference widescreen finaldrhincorporated
This document provides an overview of Diversified Restaurant Holdings, Inc. (DRH) for investors attending the Oppenheimer 18th Annual Consumer Conference. It summarizes that DRH is a leading franchisee of Buffalo Wild Wings with 65 locations, and has a current market capitalization of $34 million. The document outlines DRH's business model, growth opportunities through increasing sales and profitability, and potential for shareholder returns through debt reduction, multiple expansion, and EBITDA growth.
Build-a-modelStarting with this partial model, which contains fina.docxrichardnorman90310
Build-a-modelStarting with this partial model, which contains financial statements and other information, complete sections a thru g. All sections in yellow must be completed using formulas. All data must be computed using formulas referencing data from the financial statements and other data. Manual entry of data for solutions will result in zero points for the particular calculation.Income Statement for the Year Ending December 31 (Millions of Dollars)2019Net Sales$ 800.0Costs (except depreciation)$ 576.0Depreciation$ 60.0 Total operating costs$ 636.0Earning before int. & tax$ 164.0 Less interest$ 32.0Earning before taxes$ 132.0 Taxes (25%)$ 33.0Net income before pref. div.$ 99.0 Preferred div.$ 9.00Net income avail. for com. div.$ 90.0Common dividends$ 30.0Addition to retained earnings$ 60.0Number of shares (in millions)10Dividends per share$ 3.00Tax Rate25%Balance Sheets for December 31 (Millions of Dollars)Assets2019Liabilities and Equity2019Cash$ 28.0Accounts Payable$ 16.0Short-term investments40.0Notes payable30.0Accounts receivable80.0Accruals24.0Inventories180.0 Total current liabilities$ 70.0 Total current assets$ 328.0Long-term bonds$ 300.0Net plant and equipment600.0Preferred stock$ 90.0Total Assets$ 928.0Common Stock
(Par plus PIC)$ 257.0Retained earnings211.0 Common equity$ 468.0Total liabilities and equity$ 928.0Key Assumptions: Operating ratios remain unchanged from values in most recent year. Sales are expected to increase, 15%, 10%, 6%, and 6% during the next four years. The tax rate will remain at 25% and WACC is assumed to be 15% for all years. This data should be in a separate input table and referenced for the calculations when needed. This means you create an input table for the key assumptions data.a. Calculate the actual operating and projected ratios. Also fill in the tax rate and WACC for each year. (6.75pts)InputsActualProjectedProjectedProjectedProjected12/31/1912/31/2012/31/2112/31/2212/31/23Sales Growth RateCosts/SalesDepreciation/(Net PPE)Cash/Sales(Acct. Rec.)/SalesInventories/Sales(Net PPE)/Sales(Acct. Pay.)/SalesAccruals/SalesTax rateWeighted average cost of capital (WACC)b. Forecast the parts of the income statement and balance sheets necessary to calculate free cash flow. (13.75pts)Partial Income Statement for the Year Ending December 31 (Millions of Dollars)ActualProjectedProjectedProjectedProjectedIncome Statement Items12/31/1912/31/2012/31/2112/31/2212/31/23Net SalesCosts (except depreciation)Depreciation Total operating costsEarning before int. & taxPartial Balance Sheets for December 31 (Millions of Dollars)ActualProjectedProjectedProjectedProjectedOperating Assets12/31/1912/31/2012/31/2112/31/2212/31/23CashAccounts receivableInventoriesNet plant and equipmentOperating LiabilitiesAccounts PayableAccrualsc. Calculate free cash flow for each projected year. Also calculate the growth rates of free cash flow each year to ensure that th.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
Option #2Researching a Leader Complete preliminary rese.docxmccormicknadine86
Option #2:
Researching a Leader
Complete preliminary research on the Internet and/or using online library databases. Compose a 1 PAGE summary of sources and an overview of each source.
Post any questions or comments about the content or requirements of the Portfolio Project to the questions thread in the Discussion Forum.
.
Option 1 ImperialismThe exploitation of colonial resources.docxmccormicknadine86
Option 1: Imperialism
The exploitation of colonial resources and indigenous labor was one of the key elements in the success of imperialism. Such exploitation was a result of the prevalent ethnocentrism of the time and was justified by the unscientific concept of social Darwinism, which praised the characteristics of white Europeans and inaccurately ascribed negative characteristics to indigenous peoples. A famous poem of the time by Rudyard Kipling, "White Man's Burden," called on imperial powers, and particularly the U.S., at whom the poem was directed, to take up the mission of civilizing these "savage" peoples.
Read the poem at the following link:
Link (website):
White Man's Burden (Links to an external site.)
(Rudyard Kipling)
After reading the poem, address the following in a case study analysis:
Select a specific part of the world (a country), and examine imperialism in that country. What was the relationship between the invading country and the native people? You can select from these examples or choose your own:
Belgium & Africa
Britain & India
Germany & Africa
France & Africa
Apply social Darwinism to this specific case.
Analyze the motivations of the invading country?
How did ethnocentrism manifest in their interactions?
How does Kipling's poem apply to your specific example? You can quote lines for comparison.
.
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China Cord Blood Corp (NYSE: CO) and Golden Meditech (801 HK)asianextractor
1. The document analyzes financial and operating data from China Cord Blood Corp and finds inconsistencies that raise doubts about the accuracy of the reported numbers.
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3. The operating data shows each new subscriber contributing significantly more to unearned storage fees and deferred income between 2012-2015 despite no reported change in storage fee policies. This suggests the financial and operating data do not match.
This document contains 5 multiple choice questions regarding financial statements and ratios. Question 1 asks which statement about a profitable firm's stock price is typically correct. Question 2 asks which statement correctly describes what is shown on the statement of cash flows. Question 3 asks which statement about the relationship between dividends paid and retained earnings is correct. Question 4 asks which statement could explain an increase in cash despite a negative net cash flow from operations. Question 5 provides financial information for a company and asks how much net income exceeded free cash flow.
This document contains 5 multiple choice questions related to financial accounting concepts. Question 1 asks which statement is correct regarding earnings per share (EPS) and dividends per share (DPS). Question 2 asks which statement is correct regarding the statement of cash flows. Question 3 asks which statement is correct regarding the income statement and balance sheet. Question 4 asks which statement could explain an increase in cash with a negative net cash flow. Question 5 provides financial information for a company and asks how much net income exceeded free cash flow.
The document provides the quarterly and annual financial results for a company. Some key highlights include:
- Several consumer brands posted sales growth for the quarter including Banquet, Blue Bonnet, and Chef Boyardee, while others like ACT II and Eckrich saw declines.
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The document discusses accounting statements and cash flow. It provides an overview of key statements including the balance sheet, income statement, and statement of cash flows. The balance sheet presents a company's assets, liabilities, and equity on a given date. The income statement measures performance over a period of time by reporting revenues and expenses. The statement of cash flows reconciles cash flows from operating, investing, and financing activities. Sample statements are presented for a company called U.S. Composite Corporation to illustrate the components and analysis of each.
Mini Case112018Chapter 2 Mini CaseSituationJenny Cochran, a grad.docxpauline234567
Mini Case11/20/18Chapter 2 Mini CaseSituationJenny Cochran, a graduate of The University of Tennessee with 4 years of experience as an equities analyst, was recently brought in as assistant to the chairman of the board of Computron Industries, a manufacturer of computer components.
During the previous year, Computron had doubled its plant capacity, opened new sales offices outside its home territory, and launched an expensive advertising campaign. Cochran was assigned to evaluate the impact of the changes. She began by gathering financial statements and other data.Computron's Balance Sheets (Millions of Dollars)20182019AssetsCash and equivalents$ 60$ 50Short-term investments10010Accounts receivable400520Inventories620820Total current assets$ 1,180$ 1,400Gross fixed assets$ 3,900$ 4,820Less: Accumulated depreciation1,0001,320Net fixed assets$ 2,900$ 3,500Total assets$ 4,080$ 4,900Liabilities and equityAccounts payable$ 300$ 400Notes payable50250Accruals200240Total current liabilities$ 550$ 890Long-term bonds8001,100Total liabilities$ 1,350$ 1,990Common stock1,0001,000Retained earnings1,7301,910Total equity$ 2,730$ 2,910Total liabilities and equity$ 4,080$ 4,900Computron's Income Statement (Millions of Dollars)20182019Net sales$ 5,500$ 6,000Cost of goods sold (Excluding depr. & amort.)4,3004,800Depreciation and amortizationa290320Other operating expenses350420Total operating costs$ 4,940$ 5,540Earnings before interest and taxes (EBIT)$ 560$ 460Less interest 68108Pre-tax earnings$ 492$ 352Taxes (25%)12388Net Income $ 369$ 264Notes:a Computron has no amortization charges.Other Data20182019Stock price$50.00$30.00Shares outstanding (millions)100100Common dividends (millions)$90$84Tax rate25%25%Weighted average cost of capital (WACC)10.00%10.00%Computron's Statement of Cash Flows (Millions of Dollars)
Bart Kreps: The statement of cash flows provides information about cash inflows and outflows during an accounting period.
2019Operating Activities Net Income before preferred dividends$ 264Noncash adjustments Depreciation and amortization320Due to changes in working capital Change in accounts receivable(120) Change in inventories(200) Change in accounts payable100 Change in accruals40Net cash provided by operating activities$ 404Investing activities Cash used to acquire fixed assets$ (920)
Bart Kreps: Make sure to add back annual Depreciation to Net PP&E.
Bart Kreps: The statement of cash flows provides information about cash inflows and outflows during an accounting period.
Change in short-term investments90Net cash provided by investing activities$ (830)Financing Activities Change in notes payable$ 200 Change in long-term debt300 Payment of cash dividends(84)Net cash provided by financing activities$ 416Net change in cash.
Carter is a small regional food producer whose specialty is high-q.docxjasoninnes20
Carter is a small regional food producer whose specialty is high-quality nut products sold in the snack foods market. The company decided in 2018 to undertake a major expansion and “go national” in competition with some major snack foods companies. The company believes that its products were of higher quality than its competitors and that this quality difference will enable it to charge a premium price which would lead to greatly increased sales, profits and stock price. The company double its plant capacity and undertaken a major marketing campaign in an attempt to “go national.” Thus far, sales have not been up to the forecasted level, costs have been higher than were projected, and a large loss occurred in 2019, rather than the expected profit. As a result, its managers, directors, and investors are concerned about the firm’s survival.
Joan Watson was brought in as assistant to John King, Johnson’s chairman, who had the task of getting the company back into a sound financial position. Carter’s 2018 and 2019 actual balance sheets and income statements, together with projections for 2020, are given in Tables 1 and 2. In addition, Table 3 gives the company’s 2018 and 2019 financial ratios, together with industry average data. The 2020 projected financial statement data represent the company’s best guess for 2020 results, assuming that some new financing is arranged to get the company “over the hump.”
Watson examined monthly data for 2019 (not given in the case), and she detected an improving pattern during the year. Monthly sales were rising, costs were falling, and large losses in the early months had turned to a small profit by December. Thus, the annual data look somewhat worse than final monthly data. Also, it appears to be taking longer for the advertising program to get the message out, for the new sales offices to generate sales, and for the new manufacturing facilities to operate efficiently. In other words, the lags between spending money and deriving benefits were longer than Carter’s managers had anticipated. For these reasons, the company see hope for the company—provided it can survive in the short run.
Watson must prepare an analysis of where the company is now, what it must do to regain its financial health, and what actions should be taken. Your assignment is to help her answer the following questions. Provide clear explanations, not yes or no answers.
Table 1.
Balance Sheets
2020E 2019 2018
Assets
Cash $ 85,632 $ 7,282 $ 57,600
Accounts receivable 878,000 632,160 351,200
Inventories 1,716,480 1,287,360 715,200
Total current assets $ 2,680,112 $ 1,926,802 $ 1,124,000
Gross fixed assets 1,197,160 1,202,950 491,000
Less accumulated depreciation 380,120 263,160 146,200
Net fixed assets $ 817,040$ 939,790$ 344,800
Total assets $ 3,497,152$ 2,866,592$ 1,468,800
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John DeereOther Financial Information 2006 3rdfinance11
Deere & Company reported financial results for the nine months ended July 31, 2006. The document provides details on net sales, average identifiable assets, operating profit, and return on assets for the company's agricultural equipment, commercial and consumer equipment, and construction and forestry segments. It also provides financial data for the company's financial services segment, including net income, return on equity, and operating profit. Additionally, the document discusses Deere's use of Shareholder Value Added (SVA) as a performance metric, which measures pre-tax profit left over after subtracting the cost of capital. SVA is used for performance goals and determining some compensation.
The document discusses cash flow statements, including:
1) It compares cash flows from operating, investing, and financing activities and contrasts cash flow statements prepared under IFRS and US GAAP.
2) It distinguishes between the direct and indirect methods of presenting cash from operating activities.
3) It analyzes and interprets both reported and common-size cash flow statements, calculates performance and coverage cash flow ratios, and interprets free cash flow.
This property analysis report summarizes the key financial details of a single family rental property located in Any City, USA that was purchased for $35,000 with an 80% loan-to-value. Over the 10-year analysis period, the report projects the property will appreciate from $54,000 to $59,551 in value, while generating positive cash flow each year ranging from $2,514 to $4,519. The projected returns on investment range from 16.8% to 75.6% over the period.
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Ch02 P14 Build a Model Spring 1, 201372212Chapter 2. Ch 02 P14.docxarnit1
Joshua & White Technologies' financial statements for 2009 and 2010 are provided. The assistant is asked to analyze various ratios and perform common size and percentage change analyses to evaluate changes in the company's liquidity, asset management, profitability, and financial position between the two years. Specifically, the assistant calculates ratios such as the current ratio, inventory turnover, return on assets, and performs DuPont, common size, and percentage change analyses on the income statement, balance sheet, key line items, and ratios.
This document provides forward-looking statements and non-GAAP financial information for Monsanto's investor day on November 10, 2005. It includes reconciliations of free cash flow, non-GAAP EPS, and return on capital for fiscal years 2004-2007. The document also notes that references to fiscal years refer to Monsanto's year ending August 31 and lists several of Monsanto's trademarks.
1. The document summarizes key topics from Chapter 3 including financial statements, cash flows, taxes, and valuation metrics.
2. It provides examples of income statements, balance sheets, and statements of cash flows for a company that experienced high growth in 2007.
3. Several analyses are presented including calculations of free cash flow, return on invested capital, economic value added, and market value added, indicating the company's growth destroyed value as returns fell below the cost of capital.
Conversion worksheetGreen shaded cells are from Chapter 5 financia.docxmaxinesmith73660
Conversion worksheetGreen shaded cells are from Chapter 5 financial StatementsEnter all amounts as positive numbers. The worksheet is formatted to add debits to assets & expenses and add credits to revenues, liabilities & equityRefr. Account TitlesDebitsCreditsGov'tal Fund Balances Adjustments & EliminationsGovern-mental Funds AdjustedInternal Service FundsBalances for Gov't-wide StmtsDebitsCreditsDebitsCreditsAtype debit accounts in this columnDEBITS:type credit accounts in this columnCash830,320830,320830,320Cash with Fiscal Agent928,000928,000928,000Investments259,000259,000259,000Taxes Receivable, net274,000274,000274,000Interest Receivable, net16,85016,85016,850Inventories--Due from State Govt.580,000580,000580,000Due from Other Funds--Capital Assets-- both rows--Expenditures (expenses) Current- General Govt.1,646,9001,646,9001,646,900 Public Safety3,026,9003,026,9003,026,900 Highway and Streets2,471,9002,471,9002,471,900 Sanitation591,400591,400591,400 Health724,100724,100724,100 Welfare374,300374,300374,300 Culture and Recreation917,300917,300917,300Compensated Absences Exp--Other Expenditures (expenses)-- - Debt Service Principal800,000800,000800,000 - Interest (expenditure/expense)514,000514,000514,000 both rows - Capital Outlay5,798,1005,798,1005,798,100 - Depreciation--Other Fin. Uses - Transfers Out1,876,7001,876,7001,876,700-Total Debits21,629,77021,629,770CREDITS:Accounts Payable493,400493,400493,400Due to Other Funds40,20040,20040,200Accrued Interest Payable--Bonds Payalbe both rows--Premium on Bonds--Compensated Absence Payable--Advance from Water Utility Fund--Deferred Inflows: Property Taxes27,50027,50027,500Accumulated Depreciation both rows--Revenues-Property Taxes6,657,5006,657,5006,657,500Sales Taxes2,942,0002,942,0002,942,000Interest21,22021,22021,220Licenses & Permits800,000800,000800,000Miscellaneous350,000350,000350,000State Grant for Highway Street Expenses1,072,0001,072,0001,072,000Capital Grant- Gen Gov't332,000332,000332,000Capital Grant- Public Safety1,320,0001,320,0001,320,000----Other Financing Sources--Proceeds of Bonds4,000,0004,000,0004,000,000Premium on Bonds200,000200,000200,000Transfers In1,876,7001,876,7001,876,700Net Position at beginning of year- three rows1,497,2501,497,2501,497,250Total Credits21,629,77021,629,770column totals: debits = credits ??------
CITY OF MONROE
WORKSHEET TO CONVERT GOVERNMENTAL ACTIVITIES TO ACCRUAL BASIS
Stmt of ActivitiesProgram RevenuesNet (Expense) Revenue and Change in Net PositionExpensesCharges for ServicesOperational Grants and ContributionsCapital Grants and ContributionsGovernmental ActivitiesBusiness-Type ActivitiesTotalFunctions/ProgramsGovernmental Activities: General Government$ -$ - Public Safety-- Highways and Streets-- Sanitation-- Health-- Welfare-- Culture and Recreation-- Depreciaiton-- Interest-- Compensated Absneces-- Total Governmental Activities------Business Type Activi.
20180620 sauc oppenheimer consumer conference widescreen finaldrhincorporated
This document provides an overview of Diversified Restaurant Holdings, Inc. (DRH) for investors attending the Oppenheimer 18th Annual Consumer Conference. It summarizes that DRH is a leading franchisee of Buffalo Wild Wings with 65 locations, and has a current market capitalization of $34 million. The document outlines DRH's business model, growth opportunities through increasing sales and profitability, and potential for shareholder returns through debt reduction, multiple expansion, and EBITDA growth.
Build-a-modelStarting with this partial model, which contains fina.docxrichardnorman90310
Build-a-modelStarting with this partial model, which contains financial statements and other information, complete sections a thru g. All sections in yellow must be completed using formulas. All data must be computed using formulas referencing data from the financial statements and other data. Manual entry of data for solutions will result in zero points for the particular calculation.Income Statement for the Year Ending December 31 (Millions of Dollars)2019Net Sales$ 800.0Costs (except depreciation)$ 576.0Depreciation$ 60.0 Total operating costs$ 636.0Earning before int. & tax$ 164.0 Less interest$ 32.0Earning before taxes$ 132.0 Taxes (25%)$ 33.0Net income before pref. div.$ 99.0 Preferred div.$ 9.00Net income avail. for com. div.$ 90.0Common dividends$ 30.0Addition to retained earnings$ 60.0Number of shares (in millions)10Dividends per share$ 3.00Tax Rate25%Balance Sheets for December 31 (Millions of Dollars)Assets2019Liabilities and Equity2019Cash$ 28.0Accounts Payable$ 16.0Short-term investments40.0Notes payable30.0Accounts receivable80.0Accruals24.0Inventories180.0 Total current liabilities$ 70.0 Total current assets$ 328.0Long-term bonds$ 300.0Net plant and equipment600.0Preferred stock$ 90.0Total Assets$ 928.0Common Stock
(Par plus PIC)$ 257.0Retained earnings211.0 Common equity$ 468.0Total liabilities and equity$ 928.0Key Assumptions: Operating ratios remain unchanged from values in most recent year. Sales are expected to increase, 15%, 10%, 6%, and 6% during the next four years. The tax rate will remain at 25% and WACC is assumed to be 15% for all years. This data should be in a separate input table and referenced for the calculations when needed. This means you create an input table for the key assumptions data.a. Calculate the actual operating and projected ratios. Also fill in the tax rate and WACC for each year. (6.75pts)InputsActualProjectedProjectedProjectedProjected12/31/1912/31/2012/31/2112/31/2212/31/23Sales Growth RateCosts/SalesDepreciation/(Net PPE)Cash/Sales(Acct. Rec.)/SalesInventories/Sales(Net PPE)/Sales(Acct. Pay.)/SalesAccruals/SalesTax rateWeighted average cost of capital (WACC)b. Forecast the parts of the income statement and balance sheets necessary to calculate free cash flow. (13.75pts)Partial Income Statement for the Year Ending December 31 (Millions of Dollars)ActualProjectedProjectedProjectedProjectedIncome Statement Items12/31/1912/31/2012/31/2112/31/2212/31/23Net SalesCosts (except depreciation)Depreciation Total operating costsEarning before int. & taxPartial Balance Sheets for December 31 (Millions of Dollars)ActualProjectedProjectedProjectedProjectedOperating Assets12/31/1912/31/2012/31/2112/31/2212/31/23CashAccounts receivableInventoriesNet plant and equipmentOperating LiabilitiesAccounts PayableAccrualsc. Calculate free cash flow for each projected year. Also calculate the growth rates of free cash flow each year to ensure that th.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
The document provides an overview of key financial statements (balance sheet, income statement, statement of cash flows) and concepts (accounting income vs cash flow, EVA, taxes). It includes examples from a company called D'Leon that recently expanded its operations. The expansion increased D'Leon's sales but resulted in negative net income, cash flow, and EVA in 2002 compared to 2001. D'Leon financed the expansion using external debt.
Similar to ChapterTool KitChapter 2112018Financial Statements, Cash Flow, a.docx (20)
Option #2Researching a Leader Complete preliminary rese.docxmccormicknadine86
Option #2:
Researching a Leader
Complete preliminary research on the Internet and/or using online library databases. Compose a 1 PAGE summary of sources and an overview of each source.
Post any questions or comments about the content or requirements of the Portfolio Project to the questions thread in the Discussion Forum.
.
Option 1 ImperialismThe exploitation of colonial resources.docxmccormicknadine86
Option 1: Imperialism
The exploitation of colonial resources and indigenous labor was one of the key elements in the success of imperialism. Such exploitation was a result of the prevalent ethnocentrism of the time and was justified by the unscientific concept of social Darwinism, which praised the characteristics of white Europeans and inaccurately ascribed negative characteristics to indigenous peoples. A famous poem of the time by Rudyard Kipling, "White Man's Burden," called on imperial powers, and particularly the U.S., at whom the poem was directed, to take up the mission of civilizing these "savage" peoples.
Read the poem at the following link:
Link (website):
White Man's Burden (Links to an external site.)
(Rudyard Kipling)
After reading the poem, address the following in a case study analysis:
Select a specific part of the world (a country), and examine imperialism in that country. What was the relationship between the invading country and the native people? You can select from these examples or choose your own:
Belgium & Africa
Britain & India
Germany & Africa
France & Africa
Apply social Darwinism to this specific case.
Analyze the motivations of the invading country?
How did ethnocentrism manifest in their interactions?
How does Kipling's poem apply to your specific example? You can quote lines for comparison.
.
Option Wireless LTD v. OpenPeak, Inc.Be sure to save an elec.docxmccormicknadine86
Option Wireless LTD v. OpenPeak, Inc.
Be sure to save an electronic copy of your answers before submitting it to Ashworth College for grading. Unless otherwise stated, you should answer in complete sentences, and be sure to use correct English, spelling, and grammar. Sources must be cited in APA format.
Your response should be a minimum of four (4) double-spaced pages; refer to the Length and Formatting instructions below for additional details.
In complete sentences respond to the following prompts:
Summarize the facts of the case;
Identify the parties and explain each party’s position;
Outline the case’s procedural history including any appeals;
What is the legal issue in question in this case?
How did the court rule on the legal issue of this case?
What facts did the court find to be most important in making its decision?
Respond to the following questions:
Are there any situations in which it might be a good idea to include additional or different terms in the “acceptance” without making the acceptance expressly conditional on assent to the additional or different terms?
Under what conditions can a contract be formed by the parties’ conduct? Why wasn’t the conduct of the parties here used as the basis for a contract?
Do you agree or disagree with the court’s decision? Provide an explanation for your reasoning either agree or disagree.
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE NO. 12-80165-CIV-MARRA
OPTION WIRELESS, LTD., an Irish limited liability company, Plaintiff, v. OPENPEAK, INC., a Delaware corporation, Defendant. ______________________________/
OPINION AND ORDER
THIS CAUSE is before the Court upon Plaintiff/Counter-Defendant’s Motion to Dismiss Defendant/Counter-Plaintiff’s Counterclaim (DE 6). Counter-Plaintiff OpenPeak Inc. filed its 1 Memorandum in Opposition (DE 8). Counter-Defendant Option Wireless, Ltd, replied. (DE 12). The Court has carefully considered the briefs ofthe parties and is otherwise fully advised in the premises. I. Introduction2 In July 2010, Counter-Plaintiff OpenPeak Inc. was producing a computer tablet product for AT&T. (DE 4 ¶ 5). Seeking embedded wireless data modules for the tablet, Counter-Plaintiff submitted a purchase order to Counter-Defendant Option Wireless, Ltd, for 12,300 units of the modules at the price of $848,700.00. (DE 4 ¶ 4). Section 9 of the purchase order, labeled “BUYER’S TERMS AND CONDITIONS,” provided that [a]ll purchase orders and sales are made only upon these terms and conditions and those on the front of this document. This document, and not any quotation, invoice, or other Seller document (which, if construed to be an offer is hereby rejected), will Option Wireless, Ltd. v. OpenPeak, Inc. Doc. 19 Dockets.Justia.com 2 be deemed an offer or an appropriate counter-offer and is a rejection of any other terms or conditions. Seller, byaccepting any orders or deliverin.
Option A Land SharkWhen is a shark just a shark Consider the.docxmccormicknadine86
Option A: Land Shark
When is a shark just a shark? Consider the movie
Jaws
. What could the shark symbolize in our culture, society, or collective human mythology other than a man-eating fish? Why? Support your answer.
Next, think about a theatrical staging of
Jaws
. Describe the artistic choices you would make to bring
Jaws
the movie to Broadway. What genre would you choose? Describe at least three other elements of production and how you would approach them in your staging of
Jaws
as a stage play or musical.
Create
a response to these concepts in one of the following formats:
350- to 700-word paper
Apply
appropriate APA formatting.
.
Option 3 Discuss your thoughts on drugs and deviance. Do you think .docxmccormicknadine86
Option 3: Discuss your thoughts on drugs and deviance. Do you think using drugs is deviant behavior? Why do you think alcohol and tobacco are legal drugs and their use is not considered deviant when they are addictive, physically harmful, and socially disruptive?
No quotes or references needed.
.
OPTION 2 Can we make the changes we need to make After the pandemi.docxmccormicknadine86
OPTION 2: Can we make the changes we need to make? After the pandemic, we are in a time of significant upheaval and transition. We are all more keenly aware that economic shifts and transformations can happen suddenly and dramatically. As the World shut itself down in March 2020, it makes us all aware that we can change behavior globally and as a matter of will. In the U.S., people began to quarantine themselves ahead of government action more often than as a result of government mandates. Write a cohesive 1-2 page single-spaced document that answers the following questions.
2a. Reflecting on the profound changes we have all seen in the past year, how does that change your views regarding what might be possible with regard to energy use, carbon reductions, or other major transformations that might be needed to impact the type of climate change Earth has been experiencing.
2b. Reflect on the type of transformations that would be involved to address global warming. Now that you have seen the recent major transformations, does this make you believe that global warming threats can prompt the type of major economic and industrial changes needed to reduce the impacts that have been anticipated with increasing climate changes?
2c. What are the "experts" saying about the possibility of these transformations in light of what they have seen during the pandemic? Are researchers more or less optimistic about our global ability to reduce green house gases and control climate change after seeing the impact of the pandemic? Be sure to include REFERENCES both at the end of the text and in the text, like (Author, year)
.
Option 1 You will create a PowerPoint (or equivalent) of your p.docxmccormicknadine86
Option 1: You will create a PowerPoint (or equivalent) of your presentation and add voice over.
Option 2: If you are unable to add voice over to your PowerPoint, you will create a PowerPoint (or equivalent) of your presentation. Next, you will use
Screencast-o-
Matic
(or a similar program) to create a video recording of your screen and voice as your present the information. Third, you will upload the video presentation to
YouTube
so your instructor can view it. If you choose this option, you will submit your article as well as the PowerPoint (or equivalent) file and the link to the YouTube presentation to complete this assignment.
Guidelines:
The presentation must include both audio (your voice explaining the information) and visual (PowerPoint presentation including text and/or images). Videos should not be used within the presentation.
The presentation should include the following three aspects:
An overview of your specific topic and its importance and application in current society. Include historical information as appropriate to understand your topic.
Identification, discussion, and
critical evaluation
of the most frequently used assessment instruments related to your topic. Include the typical settings and purposes for which assessment instruments are used.
Discussion of the ethical, cultural, and societal issues concerning the use of psychological tests and assessment as related to your topic.
The presentation must be 15 minutes long (no more than 20).
The presentation must include information from at least 10 scholarly sources (if used, the course textbook does not count as one of these 10 sources).
APA style citations should be used within the presentation. A reference section (in APA style) should appear at the end of the presentation.
Resources:
.
Option A Description of Dance StylesSelect two styles of danc.docxmccormicknadine86
Option A: Description of Dance Styles
Select
two styles of dance, such as ballet, modern dance, or folk dance.
Describe
each style of dance, and
include
the following:
History and development of the style
Discussion of your understanding of the use of line, form, repetition, and rhythm in each piece
Description of what the movements of both styles communicate to you in terms of mood
Description of how artistic choice can affect the viewer in the selected style
Submit
your assignment in one of the following formats:
700- to 1,050-word paper
.
Option #2Provide several slides that explain the key section.docxmccormicknadine86
Option #2
Provide several slides that explain the key sections of your strategy you will use in the final Portfolio Project. Provide section headers and a brief description of each.
FINAL PROJECT GUIDE
In a 6- to 10-page paper, as the local Union President, design a managing union handbook for union relationship building and a process that favors union employees as well as identifying key components of the bargaining process that can easily be sold to your union members. Apply theory and design systems and policies throughout your work covering:
Contextual factors (historical and legislative) that have impacted and still impact the union environment;
policies that create a more sustainable union model;
management strategy for union collective bargaining that includes: innovative wage, benefit, and non-wage factors; and
employee engagement and involvement strategies that take into consideration the diverse and changing labor force.
.
Option 2 Slavery vs. Indentured ServitudeExplain how and wh.docxmccormicknadine86
Option 2: Slavery vs. Indentured Servitude
Explain how and why slavery developed in the American colonies.
Describe in what ways the practice of slavery was different between each colonial region in British North America.
Analyze the differences between slaves and indentured servants.
Writing Requirements (APA format)
Length: 1-2 pages (not including title page or references page)
Use standard essay writing process by including an introduction, body paragraphs, and a conclusion.
1-inch margins
Double spaced
12-point Times New Roman font
Title page
References page (minimum of 1 scholarly source)
No abstract is required
In-text citations that correspond with your end references
.
Option 2 ArtSelect any 2 of works of art about the Holocaus.docxmccormicknadine86
Option 2: Art
Select any 2 of works of art about the Holocaust. You can select from the following list or conduct additional research on Holocaust art. Make sure to get approval from your instructor if you are selecting something not on the list. Click on the link to see the list:
Link: List of Artists/Artworks
Write an analysis of each artwork, including the following information:
Identify the title, artist, date completed, and medium used.
Explain the content of the artwork - what do the images show?
How does the artwork relate to the bigger picture of the Holocaust?
How effective is the artwork in relating the Holocaust to viewers?
LIST OF ARTISTS AND ARTWORK
Morris Kestelman:
Lama Sabachthani [Why Have You Forsaken Me?]
George Mayer-Marton:
Women with Boudlers
Bill Spira:
Prisoners Carrying Cement
Jan Hartman:
Death March (Czechowice-Bielsko, January 1945)
Edgar Ainsworth:
Belsen
Leslie Cole:
One of the Death Pits, Belsen. SS Guards Collecting Bodies
Doris Zinkeisen:
Human Laundry, Belsen: April 1945
Eric Taylor:
A Young Boy from Belsen Concentration Camp
Mary Kessell:
Notes from Belsen Camp
Edith Birkin:
The Death Cart - Lodz Ghetto
Shmuel Dresner:
Benjamin
Roman Halter:
Mother with Babies
Leo Breuer:
Path Between the Barracks, Gurs Camp
Leo (Lev) Haas:
Transport Arrival, Theresienstadt Ghetto
Jacob Lipschitz:
Beaten (My Brother Gedalyahu)
Norbert Troller:
Terezin
Anselm Kiefer:
Sternenfall
.
Option #1 Stanford University Prison Experiment Causality, C.docxmccormicknadine86
Option #1:
Stanford University Prison Experiment: Causality, Controlling Patterns, and Growth Mode
Revisit Philip Zimbardo's (1971) Stanford University Prison Experiment. Analyze the experiment in terms of causality, controlling patterns, and its growth mode.
What lessons can be learned from this experiment that can be generalized to business social systems, such as organizational design/organizational structures?
Your well-written paper should meet the following requirements:
· Be 5 pages in length.
· Be formatted according to APA
· Include at least five scholarly or peer-reviewed articles
· Include a title page, section headers, introduction, conclusion, and references page.
Reference:
Revisiting the Stanford Prison Experiment: a Lesson in the Power of Situation
~~~~~~~~
BY THE 1970s, psychologists had done a series of studies establishing the social power of groups. They showed, for example, that groups of strangers could persuade people to believe statements that were obviously false. Psychologists had also found that research participants were often willing to obey authority figures even when doing so violated their personal beliefs. The Yale studies by Stanley Milgram in 1963 demonstrated that a majority of ordinary citizens would continually shock an innocent man, even up to near-lethal levels, if commanded to do so by someone acting as an authority. The "authority" figure in this case was merely a high-school biology teacher who wore a lab coat and acted in an official manner. The majority of people shocked their victims over and over again despite increasingly desperate pleas to stop.
In my own work, I wanted to explore the fictional notion from William Golding's Lord of the Flies about the power of anonymity to unleash violent behavior. In one experiment from 1969, female students who were made to feel anonymous and given permission for aggression became significantly more hostile than students with their identities intact. Those and a host of other social-psychological studies were showing that human nature was more pliable than previously imagined and more responsive to situational pressures than we cared to acknowledge. In sum, these studies challenged the sacrosanct view that inner determinants of behavior--personality traits, morality, and religious upbringing--directed good people down righteous paths.
Missing from the body of social-science research at the time was the direct confrontation of good versus evil, of good people pitted against the forces inherent in bad situations. It was evident from everyday life that smart people made dumb decisions when they were engaged in mindless groupthink, as in the disastrous Bay of Pigs invasion by the smart guys in President John F. Kennedy's cabinet. It was also clear that smart people surrounding President Richard M. Nixon, like Henry A. Kissinger and Robert S. McNamara, escalated the Vietnam War when they knew, and later admitted, it was not winnable. They were .
Option A Gender CrimesCriminal acts occur against individu.docxmccormicknadine86
Option A: Gender Crimes
Criminal acts occur against individuals because of gender – some of these are labeled as hate crimes in the U.S. (consider cases of violence against transgendered and homosexual individuals) and others occur across cultures. Choose two other types of “gender crimes” and discuss what these acts reveal about deep-seated cultural values and beliefs. One possibility is to examine bride burning or dowry death in India.
Submit a paper (750-1250 words) that explores gender crimes. Provide at least three references cited within the text and listed in the references section.
.
opic 4 Discussion Question 1 May students express religious bel.docxmccormicknadine86
opic 4: Discussion Question 1
May students express religious beliefs in class discussion or assignments or engage in prayer in the classroom? What are some limitations? Support your position with examples from case law, the U.S. Constitution, or other readings.
Topic 4: Discussion Question 2
Do all student-led religious groups have an absolute right to meet at K-12 schools? If not, discuss one limitation under the Equal Access Act. May a teacher be a sponsor of the club? Can the teacher participate in its activities? Why or why not? Support your position with examples from case law, the U.S. Constitution, or other readings.
.
Option 1Choose a philosopher who interests you. Research that p.docxmccormicknadine86
Option 1:
Choose a philosopher who interests you. Research that philosopher, detailing how they developed their ideas and the importance of those ideas to the progress of philosophy and human understanding. Keep in mind that you should be focusing on their philosophy, not simply their biography, although some basic details of their life not related to philosophy may be needed, especially when it involves experiences that influenced their thinking.
Option 2:
Look at a specific Philosophical movement. Explain the ideas important to that movement (such as existentialism and positivism) and the influence they had. I am pretty flexible on what you can do with this one, so if you have an idea, don’t hesitate to ask!
Requirements
The typed body of your paper must be a minimum of 1500 words.
It should be typed, 12 point, double spaced. A minimum of three sources must be used,
.
Option #1The Stanford University Prison Experiment Structu.docxmccormicknadine86
Option #1:
The Stanford University Prison Experiment: Structure, Behavior, and Results
Philip Zimbardo’s Stanford University Prison Experiment could be described as a system whose systemic properties enabled the behaviors of the system's actors, leading to disturbing results.
Analyze the situation. What were the key elements of the system? How did the system operate? Why did the participants behave as they did? What lessons can be learned from this experiment about systems in relation to management?
Your well-written paper should meet the following requirements:
Be six pages in length.
Be formatted according to the APA
Include at least seven scholarly or peer-reviewed articles.
Include a title page, section headers, introduction, conclusion, and references page.
Reference:
Zimbardo, P. G. (2007).
Revisiting the Stanford prison experiment: A lesson in the power of situation (Links to an external site.)
.
Chronicle of Higher Education, 53(
30), B6.
BY THE 1970s, psychologists had done a series of studies establishing the social power of groups. They showed, for example, that groups of strangers could persuade people to believe statements that were obviously false. Psychologists had also found that research participants were often willing to obey authority figures even when doing so violated their personal beliefs. The Yale studies by Stanley Milgram in 1963 demonstrated that a majority of ordinary citizens would continually shock an innocent man, even up to near-lethal levels, if commanded to do so by someone acting as an authority. The "authority" figure in this case was merely a high-school biology teacher who wore a lab coat and acted in an official manner. The majority of people shocked their victims over and over again despite increasingly desperate pleas to stop.
In my own work, I wanted to explore the fictional notion from William Golding's Lord of the Flies about the power of anonymity to unleash violent behavior. In one experiment from 1969, female students who were made to feel anonymous and given permission for aggression became significantly more hostile than students with their identities intact. Those and a host of other social-psychological studies were showing that human nature was more pliable than previously imagined and more responsive to situational pressures than we cared to acknowledge. In sum, these studies challenged the sacrosanct view that inner determinants of behavior--personality traits, morality, and religious upbringing--directed good people down righteous paths.
Missing from the body of social-science research at the time was the direct confrontation of good versus evil, of good people pitted against the forces inherent in bad situations. It was evident from everyday life that smart people made dumb decisions when they were engaged in mindless groupthink, as in the disastrous Bay of Pigs invasion by the smart guys in President John F. Kennedy's cabinet. It was also clear that smart people su.
Open the file (Undergrad Reqt_Individual In-Depth Case Study) for in.docxmccormicknadine86
Open the file (Undergrad Reqt_Individual In-Depth Case Study) for instruction which is
blue highlighted
and I already
highlighted yellow
for the section that you need to answer which is
SECTION 2.
I
uploaded 2 articles that you need to read to answer the questions
and Pay attention to (Individual In-Depth Case Study Rubric).
.
onsider whether you think means-tested programs, such as the Tem.docxmccormicknadine86
onsider whether you think means-tested programs, such as the Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Supplemental Security Income (SSI), create dependency among its recipients. Then, think about how the potential perception of dependency might contribute to the stigma surrounding welfare programs. Finally, reflect on the perceptions you might have regarding individuals who receive means-tested welfare and how that perception might affect your work with clients.
By Day 4
Post
an explanation of whether means-tested programs (TANF, SNAP, and SSI) create dependency. Then, explain how the potential perception of dependency might contribute to the stigma surrounding welfare programs. Finally, explain the perceptions you have regarding people who receive means-tested welfare and how that perception might affect your work with clients.
Support your post with specific references to the resources. Be sure to provide full APA citations for
.
Operations security - PPT should cover below questions (chapter 1 to 6)
Compare & Contrast access control in relations to risk, threat and vulnerability.
Research and discuss how different auditing and monitoring techniques are used to identify & protect the system against network attacks.
Explain the relationship between access control and its impact on CIA (maintaining network confidentiality, integrity and availability).
Describe access control and its level of importance within operations security.
Argue the need for organizations to implement access controls in relations to maintaining confidentiality, integrity and availability (e.g., Is it a risky practice to store customer information for repeat visits?)
Describe the necessary components within an organization's access control metric.
Power Point Presentation
7 - 10 slides total (
does not include title or summary slide
)
Try using the 6×6 rule to keep your content concise and clean looking. The 6×6 rule means a maximum of six bullet points per slide and six words per bullet point
Keep the colors simple
Use charts where applicable
Use notes section of slide
Include transitions
Include use of graphics / animations
.
বাংলাদেশের অর্থনৈতিক সমীক্ষা ২০২৪ [Bangladesh Economic Review 2024 Bangla.pdf] কম্পিউটার , ট্যাব ও স্মার্ট ফোন ভার্সন সহ সম্পূর্ণ বাংলা ই-বুক বা pdf বই " সুচিপত্র ...বুকমার্ক মেনু 🔖 ও হাইপার লিংক মেনু 📝👆 যুক্ত ..
আমাদের সবার জন্য খুব খুব গুরুত্বপূর্ণ একটি বই ..বিসিএস, ব্যাংক, ইউনিভার্সিটি ভর্তি ও যে কোন প্রতিযোগিতা মূলক পরীক্ষার জন্য এর খুব ইম্পরট্যান্ট একটি বিষয় ...তাছাড়া বাংলাদেশের সাম্প্রতিক যে কোন ডাটা বা তথ্য এই বইতে পাবেন ...
তাই একজন নাগরিক হিসাবে এই তথ্য গুলো আপনার জানা প্রয়োজন ...।
বিসিএস ও ব্যাংক এর লিখিত পরীক্ষা ...+এছাড়া মাধ্যমিক ও উচ্চমাধ্যমিকের স্টুডেন্টদের জন্য অনেক কাজে আসবে ...
This presentation was provided by Steph Pollock of The American Psychological Association’s Journals Program, and Damita Snow, of The American Society of Civil Engineers (ASCE), for the initial session of NISO's 2024 Training Series "DEIA in the Scholarly Landscape." Session One: 'Setting Expectations: a DEIA Primer,' was held June 6, 2024.
A review of the growth of the Israel Genealogy Research Association Database Collection for the last 12 months. Our collection is now passed the 3 million mark and still growing. See which archives have contributed the most. See the different types of records we have, and which years have had records added. You can also see what we have for the future.
Main Java[All of the Base Concepts}.docxadhitya5119
This is part 1 of my Java Learning Journey. This Contains Custom methods, classes, constructors, packages, multithreading , try- catch block, finally block and more.
Introduction to AI for Nonprofits with Tapp NetworkTechSoup
Dive into the world of AI! Experts Jon Hill and Tareq Monaur will guide you through AI's role in enhancing nonprofit websites and basic marketing strategies, making it easy to understand and apply.
Physiology and chemistry of skin and pigmentation, hairs, scalp, lips and nail, Cleansing cream, Lotions, Face powders, Face packs, Lipsticks, Bath products, soaps and baby product,
Preparation and standardization of the following : Tonic, Bleaches, Dentifrices and Mouth washes & Tooth Pastes, Cosmetics for Nails.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
The simplified electron and muon model, Oscillating Spacetime: The Foundation...RitikBhardwaj56
Discover the Simplified Electron and Muon Model: A New Wave-Based Approach to Understanding Particles delves into a groundbreaking theory that presents electrons and muons as rotating soliton waves within oscillating spacetime. Geared towards students, researchers, and science buffs, this book breaks down complex ideas into simple explanations. It covers topics such as electron waves, temporal dynamics, and the implications of this model on particle physics. With clear illustrations and easy-to-follow explanations, readers will gain a new outlook on the universe's fundamental nature.
1. ChapterTool KitChapter 211/20/18Financial Statements, Cash
Flow, and Taxes2-1 Financial Statements and ReportsThe
annual report contains a verbal section plus four key statements:
the balance sheet, income statement, statement of stockholders'
equity, and statement of cash flows.Our spreadsheets use
formulas rather than fixed numbers. For example, the cell for
Total assets for the most recent year contains the Sum formula
rather than just a fixed number. That way, if the data for any
inputs (cash, for instance) change, the spreadsheet will
automatically recalculate and provide the correct new value for
Total assets.In financial modeling, it is helpful to users when
input data is grouped together, so you should follow this
practice in your own models, too.2-2 The Balance SheetINPUT
DATA SECTION: Historical Data Used in the
Analysis20192018Tax rate25%25%Weighted average cost of
captal (WACC)11.50%11.50%Figure 2-1MicroDrive Inc.
December 31 Balance SheetsOlder version in manuscript
4/20(Millions of Dollars)Assets20192018Assets20192018Cash
and equivalents$100$110Cash and equivalents$100$102Short-
term investments10182Short-term investments1040Accounts
receivable500410Accounts
receivable500384Inventories1,000830Inventories1,000774Total
current assets$1,610$1,532Total current assets$1,610$1,300Net
plant and equipment2,0001,780Net property, plant, and
equipment (PP&E)2,0001,780Note: Net plant and equipment is
equal to cumulative purchases of fixed assets less cumulative
depreciation and cumulative disposed assets. Total
assets$3,610$3,312Total assets$3,610$3,080Liabilities and
EquityLiabilities and EquityAccounts
payable$200$190Accounts payable$200$180Notes
payable150100Notes
payable15028Accruals400370Accruals400370Total current
liabilities$750$660Total current liabilities$750$578Long-term
bonds520500Long-term bonds520350Total
2. liabilities$1,270$1,160Total liabilities$1,270$928Preferred
stock (1,000,000 shares)100100Preferred stock (1,000,000
shares)100100Common stock (50,000,000
shares)500500Common stock (50,000,000
shares)500500Retained earnings1,7401,552Retained
earnings1,7401,552Total common equity$2,240$2,052Total
common equity$2,240$2,052Total liabilities and
equity$3,610$3,312Total liabilities and equity$3,610$3,0802-2
The Income StatementFigure 2-2MicroDrive Income Statements
(and Selected Additional Information) for Years Ending
December 31(Millions, Except for Per Share
Data)20192018Older version in manuscript 4/20Net
sales$5,000$4,800Net sales50004680Costs of goods sold except
depreciation3,9003,710Costs of goods sold except
depreciation$3,900$3,618Depreciation and
amortizationa200180Depreciation and
amortizationa200180Other operating expenses500470Other
operating expenses500470Earnings before interest and taxes
(EBIT)$400$440Earnings before interest and taxes
(EBIT)400412Less interest 6040Less interest $60$56Pre-tax
earnings$340$400Pre-tax
earnings340356Taxes85100Taxes$85$89Net Income before
preferred dividends$255$300Net Income before preferred
dividends255267Preferred dividends77Preferred
dividends$7$7Net Income available to common
stockholders$248$293Net Income available to common
stockholders248260Additional InformationAdditional
InformationCommon dividends$60.0$59.4Common
dividends$60$57Addition to retained
earnings$188.0$233.6Addition to retained
earnings$188$203Number of common shares6060Number of
common shares$60$60Stock price per share$31.00$45.00Stock
price per share3138Per Share DataPer Share DataEarnings per
share, EPSb$4.13$4.88Earnings per share,
EPSb$4.13$4.33Dividends per share, DPSc$1.00$0.99Dividends
per share, DPSc$1.00$0.95Book value per share,
3. BVPSd$37.33$34.20Book value per share,
BVPSd$37.33$34.20Notes:a MicroDrive has no amortization
charges.b EPS = Net income available to common stockholders
Common shares outstandingc DPS = Dividends
paid to common stockholders
Common shares outstandingd BVPS = Total
common equity
Common shares outstanding2-4 Statement of
Stockholders’ EquityThe statement of stockholders' equity takes
the previous year's balance of common stock, retained earnings,
and stockholders' equity and then adds the current year's net
income and subtracts dividends paid to common stockholders.
The end result is the new balance of common stock, retained
earnings, and stockholders' equity. Figure 2-3MicroDrive Inc.
Statement of Stockholders' Equity(Millions of Dollars, Millions
of Shares)Preferred
Stock Common
SharesCommon
Stock Retained
EarningsTotal
EquityBalances, Dec. 31,
2018$10060$500$1,552$2,152Changes during year:Net
income$248$248Cash dividends(60)(60)Issuance/repurchase of
stock000Balances, Dec. 31, 2019$10060$500$1,740$2,340Note:
In financial statements, parentheses and red colors denote a
negative number.2-5 Statement of Cash FlowsInformation from
the balance sheet and income statement can be used to construct
the Statement of Cash Flows, which is shown below for
MicroDrive, in millions of dollars.Figure 2-4MicroDrive
Statement of Cash Flows for Year Ending Dec. 31(Millions of
Dollars)Operating Activities2019Net Income before preferred
dividends$255Noncash adjustmentsDepreciationa200Working
capital adjustmentsIncrease in accounts
receivableb(116)Increase in inventories(226)Increase in
accounts payable20Increase in accruals30Net cash provided
(used) by operating activities$163Investing ActivitiesCash used
4. to acquire fixed assetsc($420)Sale of short-term
investments30Net cash provided (used) by investing
activities($390)Financing ActivitiesIncrease in notes
payable$122Increase in bonds170Payment of common and
preferred dividends(67)Net cash provided (used) by financing
activities$225SummaryNet change in cash and
equivalents($2)Cash and securities at beginning of the
year102Cash and securities at end of the
year$100Notes:aDepreciation is a noncash expense that was
deducted when calculating net income. It must be added back to
show the correct cash flow from operations.bAn increase in a
current asset decreases cash. An increase in a current liability
increases cash. An increase in a current liability increases cash.
See the text in this section for examples and explanations.cThe
net increase in fixed assets is $220 million; however, this net
amount is after a deduction for the year’s depreciation expense.
Depreciation expense must be added back to find the increase in
gross fixed assets. From the company’s income statement, we
see that the year's depreciation expense is $200 million; thus,
expenditures on fixed assets were actually $420 million.2-6 Net
Cash Flow20192018Net
income$248.0$293.0Depreciation$200.0$180.0Net cash
flow$448.0$473.02-7 Free Cash Flow: The Cash Flow Available
for Distribution to InvestorsNet Operating Profit After
TaxesNOPAT is the amount of profit MicroDrive would
generate if it had no debt and held no financial assets.NOPAT =
EBIT x (1-T)20192018Tax rate25%25%Earnings before interest
and taxes (EBIT)$400$440x (1-T)75%75%NOPAT$300$330Net
Operating Working CapitalThe current assets (CA) used in
operations are called operating current assets. Operating CA
include the cash needed for operations, accounts receivable and
inventories.
The current liabilities (CL) that are due to operations are
called operating current liabilities. Operating CL include
accounts payable and accruals.
Net operating working capital (NOWC) is equal to operating
5. CA minus operating CL. NOWC is the net amount that a
company's operations tie up in current assets and current
liabilities. Calculating Operating Current Assets20192018Cash
and equivalents$100$102+ Accounts
receivable$500$384+Inventories$1,000$774Operating current
assets$1,600$1,260Calculating Operating Current
Liabilities20192018Accounts payable$200$180+
Accruals$400$370Operating current
liabilities$600$550Calculating Net Operating Working
Capital20192018Operating current assets$1,600$1,260−
Operating current liabilities$600$550Net operating working
capital$1,000$710Total Net Operating Capital (also just called
Operating Capital or just Capital)The Total Net Operating
Capital is Net Operating Working Capital plus any long-term
fixed assets or net plant, property, and equipment used in
operations.Calculating Total Net Operating Capital20192018Net
operating working capital$1,000$710+ Net plant and
equipment$2,000$1,780Total net operating
capital$3,000$2,490Alternative Calculation of Total Net
Operating Capital (also just called Operating Capital)Total
Funds Provided by Investors20192018Notes
payable$150$28Long-term bonds$520$350Preferred
stock$100$100Total common equity$2,240$2,052Total investor
supplied funds$3,010$2,530Total Funds Provided by Investors
for Operations20192018Total investor supplied
capital$3,010$2,530Less short-term investments$10$40Total
investor-supplied operating capital$3,000$2,490Free Cash
FlowMicroDrive's Free Cash Flow calculation is the cash flow
actually availabe for distribution to investors after the company
has made all necessary investments in fixed assets and working
capital to sustain ongoing operations.
Free cash flow is equal to NOPAT minus the investment made
in total net operating capital.
The investment in total net operating capital is equal to the
current year's total net operating capital minus the previous
year's total net operating capital.Calculating the Investment in
6. Total Net Operating Capital20192018Total net operating
capital$3,000$2,490Investment in total net operating
capital$510Calculating Free Cash Flow2019NOPAT$300−
Investment in total net operating capital$510Free cash
flow−$210Here is an alternative calculation of FCF that is
sometimes used in the financial press.2019FCF =NOPAT +
Depreciation−Gross investment in fixed assets−Investment in
NOWC =$500−$420−$290 =−$210Uses of Free Cash
Flow1. After-tax interest payments2019After-tax interest
expense = (Pre-tax interest expense) x (1-
T)=$60.0x75%=$45.02. Net repayment (issuance) of debtThe
amount of debt that is repaid is equal to the amount at the
beginning of the year minus the amount at the end of the year.
This includes notes payable and long-term debt. If the amount
of ending debt is less than the beginning debt, the company paid
of some of its debt. But if the ending debt is greater than the
beginning debt, the company actually borrowed additional funds
from creditors. In that case, it would be a negative use of
FCF.2019Repayment (issuance) to debtholders =All debt at
beginning of year - all debt at end of year=$378.0-
$670.0=−$2923. Total dividend paymentsThis includes all
dividends to preferred stockholders and dividends to common
stockholders.2019Dividends =Prefered dividends + common
dividends=$7.0+$60.0=$67.04. Net repurchase (sale) of
stockThe amount of stock that is repurchased is equal to the
amount at the beginning of the year minus the amount at the end
of the year. This includes preferred stock and common stock. If
the amount of ending stock is less than the beginning stock, the
company made net repurchases. But if the ending stock is
greater than the beginning stock, the company actually made net
issuances. In that case, it would be a negative use of
FCF.2019Repurchase stock =Preferred stock and common stock
at beginning of year
- Preferred stock and common stock at end of year=$600.0-
$600.0=$0.05. Net purchase (sale) of short-term investmentsThe
amount of net purchases of ST investments is equal to the
7. amount at the end of the year minus the amount at the beginning
of the year. If the amount of ending investments is greater than
the beginning investments, the company made net purchases.
But if the ending investments are less than the beginning
investments, the company actually sold investments. In that
case, it would be a negative use of FCF.2019Purchase ST
investments =ST investents at end of year - ST investments at
beginning of year=$10.0−$40.0=-$30.0Summary of uses of
FCF20191. After-tax interest payments$45.02. Net repayment
(issuance) of debt-$292.03. Total dividend payments$67.04. Net
repurchase (sale) of stock$0.05. Net purchase (sale) of short-
term investments-$30.0Total uses of FCF =−$210Notice that the
total uses of FCF equals the previously calculated value of
FCF.2-8 Performance EvaluationThe Return on Invested Capital
(ROIC)The Return on Invested Capital tells us the amount of
NOPAT per dollar of operating capital.2019ROIC
=NOPAT÷Total net operating capital =$300.00÷$3,000
=10.00%2018ROIC =NOPAT÷Total net operating capital
=$330.00÷$2,490 =13.25%The Operating Profitability Ratio
(OP)The operating profitability ratio show the amount of
NOPAT per dollar of sales.2019OP =NOPAT÷Sales
=$300.00÷$5,000 =6.00%2018OP =NOPAT÷Sales
=$330.00÷$4,800 =6.88%The Capital Requirement Ratio
(CR)The capital requirement ratio show the amount of operating
capital that is needed to generate a dollar of sales.2019CR
=Total net operating capital÷Sales =$3,000÷$5,000
=60.00%2018CR =Total net operating capital÷Sales
=$2,490÷$4,800 =51.88%Market Value AddedMarket Value
Added is the difference between the market value of
MicroDrive's stock and the amount of equity capital supplied by
shareholders.2019MVA =Stock pricex# of shares−Total
common equity =$31.00x60−$2,240.0 =$1,860−$2,240.0
=−$3802018MVA =Stock pricex# of shares−Total common
equity =$45.00x59.4−$2,052.0 =$2,673−$2,052.0
=$621Economic Value AddedEconomic Value Added represents
MicroDrive's residual income that remains after the cost of all
8. capital, including equity capital, has been deducted.2019EVA
=NOPAT−Operating Capital xWeighted average cost of
capital =$300−$3,000x11.5% =$300−$345
=−$452018EVA =NOPAT−Operating Capital xWeighted
average cost of capital =$330−$2,490x11.5%
=$330−$286 =$44Figure 2-6Calculating Performance
Measures for MicroDrive(Millions of Dollars)20192018Ind.
Avg.Calculating NOPATEBIT$400$440x (1 − Tax
rate)75%75%NOPAT = EBIT(1 − T)$300$330Calculating Net
Operating Working Capital (NOWC)Operating current
assets$1,600$1,260− Operating current
liabilities600550NOWC$1,000$710Calculating Total Net
Operating CapitalNOWC$1,000$710+ Net plant and
equipment2,0001,780Total net operating
capital$3,000$2,490Calculating Return on Invested Capital
(ROIC)NOPAT$300$330÷ Total net operating
capital3,0002,490ROIC = NOPAT/Total net operating
capital10.00%13.25%13.19%Weighted average cost of capital
(WACC)11.50%11.50%11.20%Calculating the Operating
Profitability Ratio (OP)NOPAT$300$330÷ Sales5,0004,800OP
= NOPAT/Sales6.00%6.88%6.75%Calculating Capital
Requirement Ratio (CR)Total net operating
capital$3,000$2,490÷ Sales5,0004,800CR = Total net operating
capital/Sales60.00%51.88%51.19%Calculating Market Value
Added (MVA)Price per share$31.00$45.00x Number of shares
(millions)60.059.4Market value of equity = P x (# of
shares)$1,860$2,673− Book value of equity2,2402,052MVA =
Market value − Book value−$380$621Calculating Economic
Value Added (EVA)Total net operating
capital$3,000.0$2,490.0x Weighted average cost of capital
(WACC)11.5%11.5%Dollar cost of
capital$345.0$286.4NOPAT$300.0$330.0− Dollar cost of
capital345.0286.4EVA = NOPAT – Dollar cost of
capital−$45.0$43.72-9 Corporate TaxesIn 2017, Congress
passed "An Act to Provide for the Reconciliation Pursuant to
Titles II and V of the Concurrent Resolution on the Budget for
9. Fiscal Year 2018." The Act is still widely known by the title in
one of its preliminary versions, the Tax Cut and Jobs Act
(TCJA). We will refer to it as the 2017 Tax Act or just the Act.
The 2017 Tax Act made major changes to the corporate and
personal tax regulations. Following are descriptions and
examples of several important items in the Act.Tax RatesThe
biggest change was to the actual tax rates. Prior to the the Act's
passage, corporate taxes were progressive (i.e., the rate was
higher for higher taxable income) up to $18,333,333. Beyond
this amount, the tax rate was 35%. The new tax code is not
progressive but instead applies a flat 21% rate to taxable
income.For example, consider a company with taxable income
of $200 million. Previous tax rate = 35%Taxable income =
$200millionNew tax rate = 21%Tax on income =
$42million2017 tax on same income = $70millionTax saving
due to 2018 Act = $28Percentage reduction in taxes =
40%Interest Expense Deduction LimitationBefore the Act,
corporations could deduct the entire amount of their interest
expenses when calculating taxable income. However, the Act
put a limit on the amount of interest that could be deducted. For
2018, 2019, 2020, and 2021, the Act reduced the allowable
interest expense deduction to 30% of earnings before interest,
taxes, and depreciation & amortization (EBITDA). For 2022 and
subsequent years, the Act reduced the allowable interest
expense deduction to 30% of earnings before interest and taxes
(EBIT).For example, consider a company with EBITDA of $160
million in 2019 and interest expenses of $80.EBITDA =
$160millionInterest expense = $80millionPercentage of
allowable deduction = 30%Allowable interest rate deduction =
$48millionRemaining interest expense to carry forward =
$32millionLoss CarryforwardFor example, consider a company
in the following situation.Cumulative prior unused net operating
lossess = $120million2019 taxable income prior to carryforward
adjustment = $100million2020 taxable income prior to
carryforward adjustment = $100millionCarryforward: Limitation
on offset of taxable income = 80%Federal corporate tax rate =
10. 21%Table 2-1Apex Corporation: Tax Loss Carryforward
(Millions of Dollars)Calculation of tax if ignore carryforward
losses201820192020Taxable operating profit if no carryforward
provision$100.0$100.0Tax (21%) if no carryforward
provision$21.0$21.0Calculation of maximum allowed
carryforward lossUnadjusted taxable operating profit prior to
carryforward$100.0$100.0Maximum allowed carryforward lossa
$80.0$80.0Cumulative prior unused net operating
lossesb$120$40.0$0.0Calculation of maximum allowed
carryforward lossUnadjusted taxable profit prior to
carryforward$100.0$100.0Allowed prior unused net operating
losses carried forwardc$80.0$40.0Adjusted taxable
profit$20.0$60.0Tax on adjusted profit (21%)$4.2$12.6Tax
savings due to carryforward provisionTax if carryforward losses
are ignored$21.0$21.0Tax on adjusted profit (21%) after
carryforward$4.2$12.6Tax savings due to
carryforward$16.8$8.4Notes:aThe maximum allowed carry
forward loss is limited to 80% of the unadjusted taxable
operating profit.bThe cumulative prior unused net operating
loss for Yeart is equal to its value in Yeart-1 minus the amount
that is used in Yeart.cThe operating loss that is carried forward
is equal to the minimum of the prior unused operating losses
and 80% of the current unadjusted operating loss.Dividend
Income Received by a CorporationIf a corporation receives
dividends from another, it may exclude a portion of the
dividends from taxation.Amount of investible funds =
$136.8millionCoupon rate on preferred stock = 7.310%Dividend
exclusion rate = 50%Tax rate = 21%Pre-tax dividends received
by a company = (Preferred coupon rate)(Amount invested)=
$10.000millionTax on dividends = (Dividends)(1 − Dividend
exclusion rate)(Tax rate)= ($10)(1 − 50%)(21%)=
$1.05millionAfter-tax dividends = $8.950millionEffective tax
rate on dividends received = (After-tax dividends)/(Pre-tax
dividends)= 10.50%Suppose the company in the previous
example invests in debt rather than preferred stock because debt
usually has a higher pre-tax rate of return than preferred stock.
11. For example, suppose the company above invests the same
amount in debt with an interest rate higher than the coupon rate
on the preferred stock.Amount of investible funds =
$136.8millionInterest rate on debt = 8.18%Pre-tax interest
income received by a company = $11.19millionTax rate =
21%Tax on interest = (Interest income)(Tax rate)=
$2.35millionAfter-tax interest = $8.84millionEffective tax rate
on interest received = (After-tax interest)/(Pre-tax interest)=
21.0%The net result is that corporations are taxed less on
dividend income.Effective tax rate on interest received =
21.0%Effective tax rate on dividends received = 10.5%Tax
advantage of dividend versus interest income = 10.5%Dividends
and Interest Paid by a CorporationThe interest paid by a
corporation is deducted from its operating income to obtain its
taxable income. Therefore, a firm needs $1 of pre-tax income to
pay $1 of interest.In contrast, dividends paid are not deductible.
If the combined federal + state tax rate is 24.8%, how much pre-
tax income is needed to pay $1 of dividends?Combined federal
+ state tax rate = 24.8%Pre-tax income needed =$1/(1 - T)=
$1.33Working backwards, suppose a company has $1.33 in pre-
tax earnings and has a 24.8% combined federal + state tax rate.
How much can it pay in dividends?Pre-tax income = $1.33After-
tax income =(Pre-tax income)(1 - T)= $1.002-10 Personal
TaxesMost of the changes to the personal tax code are actually
suspensions of elements in the prior code and will revert to
their former values for the 2026 tax year unless Congress
intervenes. In other words, the most of the TCJA’s changes to
the personal tax code are in effect only for tax years 2018-
2025.Tax brackets and ratesHow much will a person owe on
taxable income of $9,525? On $38,700?For the 2018 tax year,
individuals with less than $9,525 of taxable income are subject
to a federal income tax rate of 10%.Top of first bracket =
$9,525Tax rate for income less than the first bracket =
10%Taxable income = $8,000Tax = $800.00How much will a
taxpayer owe on taxable income of $29,525?Top of first bracket
= $9,525Tax rate for income less than the first bracket =
12. 10%Top of second bracket = $38,700Tax rate for income over
the first bracket but under the second bracket = 12%Taxable
income = $29,525Amount taxed at first bracket's rate
=$9,525Tax on amount in first bracket = $952.50Amount taxed
at second bracket's rate =$20,000Tax on amount in first bracket
= $2,400.00Total tax = $3,352.50Interest on municipal bonds
versus interest on corporate bondsInterest rate on municipal
bond = 5.50%Marginal tax rate on individual = 37.00%How
much must a corporate bond pay until it is a better deal than the
municipal bond?Pre-tax interest rate on corporate bond needed
to provide same after-tax return as a municipal bond = (Rate on
muni)/(1 − Marginal tax rate)= 8.73%
2-2SECTION 2-2SOLUTIONS TO SELF-TESTA firm has $8
million in total assets. It has $3 million in current liabilities,
$2 million in long-term debt, and $1 million in preferred stock.
What is the reported net worth (i.e., the reported common
equity)?Total assets$8,000,000Current
liabilities$3,000,000Long-term debt$2,000,000Preferred
stock$1,000,000The net worth of shareholders, also called
common equity, is equal to the total assets less all liabilities
and preferred stock.Net worth = common equity =$2,000,000
2-3SECTION 2-3SOLUTIONS TO SELF-TESTA firm has
$2,000,000 million in earnings before taxes. The firm has an
interest expense of $300,000 and depreciation of $200,000; it
has no amortization. What is its EBITDA? Earnings before
taxes$2,000,000Interest$300,000Depreciation$200,000Amortiza
tion$0EBITDA stands for earnings before interest, taxes, and
depreciation. To calculate EBITDA using the given information,
start with earnings before taxes and add back interest,
depreciation, and amortization.EBITDA$2,500,000Now suppose
a firm has the following information: $7 million in sales, $4
million of costs of goods sold excluding depreciation &
amortization, $500,000 of other operating expenses. What is its
EBITDA? Sales$7,000,000Costs of goods sold excluding
depreciation and amortization $4,000,000Other operating
expenses$500,000EBITDA stands for earnings before interest,
13. taxes, and depreciation. To calculate EBITDA using the given
information, start with sales and subtract costs of goods sold
(excluding depreciation) and other operating
costs:EBITDA$2,500,000
2-4SECTION 2-4SOLUTIONS TO SELF-TESTA firm had a
retained earnings balance of $3 million in the previous year. In
the current year, its net income is $2.5 million. If it pays $1
million in common dividends in the current year, what it its
resulting retained earnings balance?Previous retained earnings
balance$3,000,000Current net income$2,500,000Common
dividends$1,000,000This year's addition to retained earnings is
the amount of net income not paid out in dividends:Addition to
retained earnings$1,500,000The new balance of retained
earnings is the previous year's balance plus this year's addition
to retained earnings:Current retained earnings
balance$4,500,000
2-5SECTION 2-5SOLUTIONS TO SELF-TESTA firm has
inventories of $2 million for the previous year and $1.5 million
for the current year. What impact does this have on net cash
provided by operations? Previous year's
inventories$2,000,000Current year's
inventories$1,500,000Inventories are assets that a company
owns. When inventories increase (perhaps because the company
bought more goods than it sold), cash goes down due to the
increase in assets owned by the company.
When inventories decrease (perhaps because the company sold
more goods than it purchased), cash goes up due to the decrease
in assets owned by the company.
Therefore the cash flow due to a change in inventories is equal
to the previous year's inventories minus the current year's
inventories:Cash flow due to inventories = Previous year's
inventories −Current year's inventoriesChange in net cash
provided by operations$500,000
2-6SECTION 2-6SOLUTIONS TO SELF-TESTA firm has net
income of $5 million. Assuming that depreciation of $1 million
is its only noncash expense, what is the firm’s net cash
14. flow?Net income$5,000,000Depreciation$1,000,000Net cash
flow = Net income + Noncash expensesNet cash flow$6,000,000
2-7SECTION 2-7SOLUTIONS TO SELF-TESTSuppose a firm
has the following information: Sales = $10 million; costs of
goods sold (excluding depreciation) = $5 million; depreciation
= $1.4 million; other operating expenses = $2 million; interest
expense = $1 million. If the tax rate is 25%, what is NOPAT,
the net operating profit after taxes? Sales$10,000,000Costs of
goods sold (excluding
depreciation)$5,000,000Depreciation$1,400,000Other operating
expenses$2,000,000Interest expense$1,000,000Tax rate25%The
first step is to calculate the earnings before interest and taxes,
EBIT. This is the amount of pre-tax operating earnings.EBIT
=Sales − Costs of goods sold excluding depreciation −
Depreciation − Other operating expensesNotice that interest
expense is not subtracted because interest is not an operating
expense.EBIT = pre-tax operating earnings =$1,600,000The
second step is to calculate NOPAT, which is equal to after-tax
operating earnings.NOPAT =EBIT (1−T)NOPAT
=$1,200,000Suppose a firm has the following information: Cash
= $500,000; short-term investments = $2.5 million; accounts
receivable = $1.2 million, inventories = $1 million, and net
plant and equipment = $7.8 million. How much is tied up in
operating current assets? Cash$500,000Short-term
investments$2,500,000Accounts
receivable$1,200,000Inventories$1,000,000Net plant and
equipment$4,000,000Operating current assets are the short-term
assets used in operations. They do not include an short-term
investments or marketable securities that are not a part of
normal operations. They do not include any long-term assets.
Operating CA =Cash + Accounts receivable +
inventoriesOperating current assets =$2,700,000Suppose a firm
has the following information: Accounts payable = $1 million;
notes payable = $1.1 million; short-term debt = $1.4 million;
accruals = $500,000; and long-term bonds = $3 million. What is
the amount arising from operating current liabilities?Accounts
15. payable$1,000,000Notes payable$1,100,000Short-term
debt$1,400,000Accruals$500,000Long-term
bonds$3,000,000Operating current liabilities are the short-term
liabilities arising from operating acivities. They do not include
any form of debt, including notes payable, short-term debt, or
long-term bonds.Operating CL =Accounts payable +
accrualsOperating current liabilities =$1,500,000Suppose a firm
has the following information: Operating current assets = $2.7
million; operating current liabilities = $1.5 million, long-term
bonds = $3 million, net plant and equipment = $7.8 million; and
other long-term operating assets = $1 million. How much is tied
up in net operating working capital? How much is tied up in
total net operating capital? Operating current
assets$2,700,000Operating current liabilities$1,500,000Long-
term bonds$3,000,000Net plant and equipment$7,800,000Other
long-term operating assets$1,000,000Net operating working
capital (NOWC) is the net amount tied up in short-term
operating assets after adjusting for the amount arising from
short-term operating liabilities. It does not include any cash ties
up in long-term assets and it is not adjusted for any cash
provided by investors.Net operating working capital = NOWC
=Operating current assets − Operating current liabilitiesNet
operating working capital = NOWC =$1,200,000Total net
operating capital includes the net amount tied up in net
operating working capital (NOWC) and the amount tied up in all
long-term operating assets. It is not adjusted for any cash
provided by investors.Total net operating capital =Net operating
working capital + Net plant and equipment + Other long-term
operating assetsTotal net operating capital =$10,000,000A
firm’s total net operating capital for the previous year was $2
million. For the current year, its total net operating capital is
$2.5 million and its NOPAT is $1.2 million. What is its free
cash flow for the current year? Previous year's total net
operating capital$9,300,000Current year's total net operating
capital$10,000,000Current year's NOPAT$1,200,000First,
calculate the investment in total net operating
16. capital.Investment in total net operating capital =Current year's
total net operating capital − previous year's total net operating
capitalInvestment in total net operating capital
=$700,000Second, calculate free cash flow.Free cash flow
=NOPAT − Investment in total net operating capitalFree cash
flow =$500,000
2-8SECTION 2-8SOLUTIONS TO SELF-TESTA company has
sales of $200 million, NOPAT of $12 million, net income of $8
million, new operating working capital (NOWC) of $10 million,
total net operating capital of $100 million, and total assets of
$110 million. What is it operating profitability (OP) ratio? Its
capital requirment (CF) ratio? Its return on invested capital
(ROIC)? Sales$200millionNOPAT$12millionNet
income$8millionNet operating working capital$10millionTotal
net operating capital$100millionTotal assets$110millionThe
operating profitability (OP) ratio measures the dollars of
operating profit per dollar of sales.OP =NOPAT / SalesOP
=6%The capital requirement (CR) ratio measures the dollars of
total net operating capital tied up per dollar of sales.CR =(Total
net operating capital) / SalesCR =50%The return on invested
capital (ROIC) measures the dollars of operating profit per
dollar of total net operating capital.ROIC =NOPAT / (Total net
operating capital) = OP / CRROIC = NOPAT / (Total net
operating capital) =12%ROIC = OP / CR =12.00%A firm has
$100 million in total net operating capital. Its return on
invested capital is 14 percent, and its weighted average cost of
capital is 10 percent. What is its EVA?Total net operating
working capital$100,000,000ROIC14%WACC10%Free cash
flow =$4,000,000
2-9SECTION 2-9SOLUTIONS TO SELF-TEST If a corporation
has $85,000 in taxable income, what is its tax liability?Taxable
income$85,000Tax rate 21%Tax liability$17,850
Mini Case Data11/20/18Chapter 2 Mini CaseSituationJenny
Cochran, a graduate of The University of Tennessee with 4
years of experience as an equities analyst, was recently brought
in as assistant to the chairman of the board of Computron
17. Industries, a manufacturer of computer components.
During the previous year, Computron had doubled its plant
capacity, opened new sales offices outside its home territory,
and launched an expensive advertising campaign. Cochran was
assigned to evaluate the impact of the changes. She began by
gathering financial statements and other data.Computron's
Balance Sheets (Millions of Dollars)20192020AssetsCash and
equivalents$ 60$ 50Short-term investments10010Accounts
receivable400520Inventories620820Total current assets$
1,180$ 1,400Gross fixed assets$ 3,900$ 4,820Less:
Accumulated depreciation1,0001,320Net fixed assets$ 2,900$
3,500Total assets$ 4,080$ 4,900Liabilities and
equityAccounts payable$ 300$ 400Notes
payable50250Accruals200240Total current liabilities$ 550$
890Long-term bonds8001,100Total liabilities$ 1,350$
1,990Common stock1,0001,000Retained
earnings1,7301,910Total equity$ 2,730$ 2,910Total
liabilities and equity$ 4,080$ 4,900Computron's Income
Statement (Millions of Dollars)20192020Net sales$ 5,500$
6,000Cost of goods sold (Excluding depr. &
amort.)4,3004,800Depreciation and amortizationa290320Other
operating expenses350420Total operating costs$ 4,940$
5,540Earnings before interest and taxes (EBIT)$ 560$
460Less interest 68108Pre-tax earnings$ 492$ 352Taxes
(25%)12388Net Income $ 369$ 264Notes:a Computron has no
amortization charges.Other Data20202019Stock
price$57.00$40.00Shares outstanding (millions)100100Common
dividends (millions)$90$84Tax rate25%25%Weighted average
cost of capital (WACC)10.00%10.00%Computron's Statement of
Cash Flows (Millions of Dollars)
Bart Kreps: The statement of cash flows provides information
about cash inflows and outflows during an accounting period.
2020Operating Activities Net Income before preferred
dividends$ 264Noncash adjustments Depreciation and
amortization320Due to changes in working capital Change in
18. accounts receivable(120) Change in inventories(200) Change
in accounts payable100 Change in accruals40Net cash
provided by operating activities$ 404Investing activities
Cash used to acquire fixed assets$ (920)
Bart Kreps: Make sure to add back annual Depreciation to Net
PP&E.
Change in short-term investments90Net cash provided by
investing activities$ (830)Financing Activities Change in
notes payable$ 200 Change in long-term debt300 Payment
of cash dividends(84)Net cash provided by financing activities$
416Net change in cash and equivalents$ (10)Cash and
securities at beginning of the year60Cash and securities at end
of the year$ 50
Web 2ARead this comment
Michael Ehrhardt: The rates shown are those available in spring
2018. They may change as inflation is incorporated into the
dollar break points.11/20/18Web Extension 2A: Tool Kit for
Individual TaxesSome of the examples here are simplified for
the sake of clarity and do not necessarily reflect all the possible
exceptions and minor adjustments in the actual tax code. Do not
use these examples as a substitute for the actual IRS instruction
or the advice of a profession tax preparer.The rates shown are
those available in spring 2018. They may change as inflation is
incorporated into the dollar break points.Table 2A-1 Individual
Tax TableIf an individual'sHe/she pays this Plus this
percentageAverage tax taxable incomeamount on theon the
excessrate at is between:base of the bracketover the basetop of
bracket(1)(2)(3)(4)(5)$0$9,525$0.0010.0%10.0%$9,525$38,700
$952.5012.0%11.5%$38,700$82,500$4,453.5022.0%17.1%$82,5
00$157,500$14,089.5024.0%20.4%$157,500$200,000$32,089.5
032.0%22.8%$200,000$500,000$45,689.5035.0%30.1%$500,00
0and up$150,689.5037.0%37.0%Married (Joint Return) Tax
TableIf a couple'sIt pays this Plus this percentageAverage tax
taxable incomeamount on theon the excessrate at is
19. between:base of the bracketover the basetop of
bracket(1)(2)(3)(4)(5)$0$19,050$0.0010.0%10.0%$19,050$77,4
00$1,905.0012.0%11.5%$77,400$165,000$8,907.0022.0%17.1%
$165,000$315,000$28,179.0024.0%20.4%$315,000$400,000$64
,179.0032.0%22.8%$400,000$600,000$91,379.0035.0%26.9%$6
00,000and up$161,379.0037.0%37.0%Application of tax table
to single filers and married (joint return) filers.Suppose an
individual filer has taxable income (Form 1040 Line 44) of
$60,000. All the earning are from wages (i.e., none are from
dividend income or net long-term capital gains).Individual
filer:Taxable incomeTaxAverage Tax
Rate$60,000.00$9,139.5015.23%Suppose a married couple
filing jointly has taxable income (Form 1040 Line 44) of
$120,000. All the earning are from wages (i.e., none are from
dividend income or net long-term capital gains).Married (joint)
filer:Taxable incomeTaxAverage Tax
Rate$120,000.00$18,279.0015.23%As shown below, the married
joint filers have twice as much taxable income as the individual
filer and they have twice as much tax as the indidvidual filer.
Prior to the TCJA, this was not the case--married joint filers
paid more in taxes than twice the individual filers with the same
taxable income. This was called the marriage penalty, which
was common if both spouses had similar incomes. The TCJA
eliminated the marriage penalty.Married taxable income /
Individual taxable income = 2.00Married tax / Individual tax =
2.00Example: Using Tax Rates and Brackets to Calculate
Personal Taxes Exemption per person =$0Read comment.
Michael Ehrhardt: When filing a tax return in 2018 for the 2017
tax year, each taxpayer received an exemption of $4,500 for
each dependent, including the taxpayer, which reduced taxable
income. However, the TCJA eliminated personal exemptions for
2018-2025.Standard deduction (individual) =$12,000Standard
deduction (married filing joint) =$24,000Social Security (SS)
tax rate =6.20%Wage base level for capping SS tax
=$128,700Medicare tax rate =1.45%Additional Medicare Tax
20. rate =0.90%Additional Medicare Tax for single filers begins at
=$200,000Additional Medicare Tax for married joint filers
begins at =$250,000Income tax on wage, salaries, tips, etc.Find
the marginal income tax rate, the U.S. income tax, and the
average tax rate for a single person in the following situation.
Gross income
(all as wages reported on Form 1040 Line 7)
=$70,700.00Standard deduction =$12,000.00Taxable Income
=$58,700.00Base taxable income =$38,700.00Base tax
=$4,453.50Marginal tax rate =22.0%Tax =$8,853.50Average tax
rate =15.08%Payroll taxes: Social Security taxes and Medicare
taxesUsing the example above, how much would remain after
income taxes, Social Security taxes, and Medicare taxes? Gross
income (all as wages) =$70,700.00Amount subject to Social
Security rate =$70,700.00Social Security tax rate =6.2%Social
Security tax =$4,383.40Medicare tax rate =1.45%Additional
Medicare tax rate for high incomes =0.90%Total Medicare tax
rate =1.45%Medicare tax =$1,025.15Total payroll taxes (Social
Security and Medicare) =$5,408.55Remaining after income
taxes,
Social Security, and Medicare =$56,437.95Suppose the person
in the previous example receives a $1,000 raise. What are the
additional income taxes and combined Social Security and
Medicare taxes (assume the person is not self-employed).Pay
raise:$1,000.00Gross income (all as wages)
=$71,700.00Standard deduction =$12,000.00Taxable Income
=$59,700.00Base taxable income =$38,700.00Base tax
=$4,453.50Marginal tax rate =22.0%Tax =$9,073.50Average tax
rate =15.20%Social Security payment rate =6.2%Amount
subject to Social Security rate =$71,700.00Social Security
payment =$4,445.40Medicare payment rate =1.45%Social
Security payment =$1,039.65Remaining income after income
taxes,
Social Security, and Medicare =$57,141.45Additional income
due to raise =$703.50If the increase in income does not put the
gross income into a new tax bracket and does not exceed the
21. limit for Social Security taxes, then the additional after-tax
raise is equal to the pre-tax raise multiplied by the marginal tax
rate.Marginal tax rate =22%Additional income tax
=$220Additional Social Security and Medicare tax
=$76.50Total after-tax raise =$703.50Net Investment Income
TaxIn addition to tax on various types of investment income,
there is 3.8% Net Investment Income Tax levied on investment
income that exceeds a limit, as shown below.Net investment
income tax rate = 3.80%Net investment income tax threshold for
single filers = $200,000Net investment income tax threshold for
joint filers = $250,000Single filer's investment income =
$80,000Single filer's modified adjusted gross income
=$300,000Modified adjusted gross income minus the threshold
= $100,000Minimum of net investment income and excess of
modified adjusted gross income over the threshold =
$80,000Net investment income tax =$3,040Municipal bond
after-tax interestSuppose an individual is at the top tax bracket.
This person is considering purchasing either a tax-exempt
municipal bond or a a corporate bond. Total investment income
is below the threshold that triggers the additional Net Income
Investment Tax. Using the information below, which bond
should the person buy?Interest rate on corporate bond =
8.00%Interest rate on municipal bond = 5.50%Marginal tax rate
on individual = 37.00%After-tax return on corporate bond =
(Interest rate)(1 − Marginal tax rate)= 5.04%How much must a
corporate bond pay until it is a better deal than the municipal
bond?Pre-tax interest rate on corporate bond needed to
provide same after-tax return as a municipal bond = (Rate on
muni)/(1 − Marginal tax rate)= 8.73%If we know the pre-tax
yield on the corporate bond, how much must a muni pay for it
to be a better deal than the corporate bond?Pre-tax interest rate
on corporate bond = 8.73%Marginal tax rate on individual =
37.00%Required interest rate on muni = (Pre-tax rate on
corporate bond)(1 − Marginal tax rate)= 5.50%Dividend and
Capital Gains TaxationFirst, there is no separate line of Form
1040 to record the tax on qualified dividends and net long-term
22. gains. (The dividends we discuss will be qualied. Loosely
speaking, a qualified dividend one that is actually paid by a
domestic C corporation.) Instead, it is embedded in the
caculations of 1040 line 44, Tax. So you have to use the
"Qualified Dividends and Capital Gain Worksheet" in Form
1040. The following examples isolate the tax treatment of
dividends and gains from the embedded calculations in the
"Qualified Dividends and Capital Gain Worksheet" in Form
1040.Dividends and net long-term capital gains are taxed
exactly the same way, so we will usually refer to "combined
dividends and gains" when discussing taxes. Combined
dividends and gains are taxed differently from ordinary income.
Combined dividends and gains have progressive brackets that
differ from those for ordinary income. The following examples
are based on the combined amount of dividends and capital
gains. Note: At high incomes, there may be an additional Net
Investment Income Tax, as we illustrated previously. We omit
this from the following examples to better focus on the separate
tax on combined dividend and gains. Table 2A-2Tax Brackets
and Rates for Calculating Tax on Combined Dividends and
Long-Term Capital Gains for the 2018 Tax Year (as available in
March, 2018)Single
FilersBracketsRatesRates$0$38,6000.00%0.00%$38,600$425,80
015.00%15.00%$425,800and up20.00%20.00%Married Joint
FilersBracketsRatesRates$0$77,2000.00%0.00%$77,200$479,00
015.00%15.00%$479,000and up20.00%20.00%Summary of
BracketsSingle filers1st bracket =$38,6002nd bracket
=$425,800Amount between 1st and 2nd bracket =
$387,200Married joint filers1st bracket =$77,2002nd bracket
=$479,000Amount between 1st and 2nd bracket =
$401,800Suppose a married couple has ordinary income of
$379,000 and dividends & gains of $200,000. How much tax do
they owe on the dividends & gains?Married joint filersOrdinary
income = $379,000Dividends and gains = $150,000Line 43
taxable income = $529,000Total tax tax on dividends & gains
using calcuations shown below =$25,000Will there be taxable
23. income only at the 20% rate? If so, how much? Is ordinary
income > 2nd bracket = FALSETax on dividends & gain =
FALSEIs ordinary income between 1st and 2nd bracket?
TRUEAmount of bracket filled by ordinary income
=$301,800Remaining amount of bracket NOT filled by ordinary
income =$100,000Amount of bracket filled by dividends &
gains =$100,000Tax on dividends & gains between 1st and 2nd
bracket =$15,000Amount of remaining untaxed dividends &
gains = $50,000Tax on dividends & gains > over 2nd bracket
=$10,000Total Tax on div and gain if ordinary income is
between 1st and 2nd brackets = $25,000Is ordinary income in
1st bracket? FALSEAmount of bracket filled by ordinary
income =FALSERemaining amount of bracket NOT filled by
ordinary income =FALSEAmount of bracket filled by dividends
& gains =FALSETax on dividends & gains below 1st bracket
=$0Amount of remaining untaxed dividends & gains =
FALSEAmount of remaining dividends & gains below 2nd
bracket = FALSETax on dividends & gains between the brackets
= $0Amount of dividends and gains > 2nd bracket = FALSETax
on dividends & gains > over 2nd bracket =$0Total tax on
dividends & gains if ordinary < 1st bracket = $0Single
filersOrdinary income = $20,000Dividends and gains =
$500,000Line 43 taxable income = $520,000Total tax tax on
dividends & gains using calcuations shown below =$76,920Will
there be taxable income only at the 20% rate? If so, how much?
Is ordinary income > 2nd bracket = FALSETax on dividends &
gain = FALSEIs ordinary income between 1st and 2nd bracket?
FALSEAmount of bracket filled by ordinary income
=FALSERemaining amount of bracket NOT filled by ordinary
income =FALSEAmount of bracket filled by dividends & gains
=FALSETax on dividends & gains between 1st and 2nd bracket
=$0Amount of remaining untaxed dividends & gains =
FALSETax on dividends & gains > over 2nd bracket =$0Total
Tax on div and gain if ordinary income is between 1st and 2nd
brackets = $0Is ordinary income in 1st bracket? TRUEAmount
of bracket filled by ordinary income =$20,000Remaining
24. amount of bracket NOT filled by ordinary income
=$18,600Amount of bracket filled by dividends & gains
=$18,600Tax on dividends & gains below 1st bracket
=$0Amount of remaining untaxed dividends & gains =
$481,400Amount of remaining dividends & gains below 2nd
bracket = $387,200Tax on dividends & gains between the
brackets = $58,080Amount of dividends and gains > 2nd bracket
= $94,200Tax on dividends & gains > over 2nd bracket
=$18,840Total tax on dividends & gains if ordinary < 1st
bracket = $76,920