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Business Finance: 5 Questions! Need answers ASAP! A lot of points!

1.) Which of the following actions are Sources or Uses of funds?

A. An Increase of $2 million of new common stock.

B. In increase in new plant and equipment at a cost of $3 million.

C. Notes payable are decreased.

D. Increases dividend paid on its common stock.

2.) A company had $55,000 in cash at year-end 2013 and $25,000 in cash at year-end 2014. The firm invested in plant and equipment totaling $250,000. Cash flow from investing activities totaled +$170,000 and cash flow from financing activities totaled +$170,000. What was the cash flow from operating activites?

3.) Computer World paid out $22.5 million in total common dividends and reported $278.9 million of retained earnings at year-end. The prior years retained earnings were $212.3 million. What was Net Income?

4.) For 2014, an electronics firm reported $22.5 million of sales and $18 million of operating costs (including depreciation). The company has $15 million of invested capital and the after tax cost of capital is 9%. Tax rate is 35%. What was the Economic Value Added (EVA)?

5.) Byrd Lumber has 2 million shares of common stock outstanding that sells for $17 per share. If the company has $40 million of common equity on its balance sheet, what is the company's Market Value Added?

A. -$5,415,000

B. -$5,700,000

C. -$6,000,000

D. -$6,300,000

E. -$6,615,000

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Lelia Lubowitz
Lelia LubowitzLv2
28 Sep 2019

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Please help with question D

Last year Rattner Robotics had $5 million of operating income. Its depreciation expense was $1 million, its interest expense was $1 million, and its corporate tax rate was 40%. At year-end, it had $14 million in current asset, $3 million in accounts payable, $1 million in (expense) accrual’s, $2 million in notes payable, and $15 million in net plant and equipment. Rattner had no other current liabilities. Assume that Rattner's only noncash item was depreciation.

a. What was the company's net income?

b. What was its net operating working capitals (NOWC)?

c. What was its net working capital (NWC)?

d. Rattner had $12 million in net plant and equipment the prior year. Its net operating working capital has remained constant over time. What is the company's free cash flow (FCF) for the year that just ended?

e. Rattner had 500,000 common shares outstanding and the common stock amount on the balance sheet is $5 million. The company has not issued or repurchased common stock during last years. Last year's balance in retained earnings was $12 million and the firm paid out dividends of $1.2 million during the year. Develop Rattner's end-of-year Statement of StockHolders Equity.

What was the company's net income?

Company's net income = (operating income - interest expense)*(1-tax rate)

(5 -1)*(1-40%)

Company's net income = $ 2.40 Milliion

What was its net operating working capitals (NOWC)?

Net operating working capitals = current asset - accounts payable - accruals

14 - 3 - 1

Net operating working capitals = $ 10 Million

What was its net working capital (NWC)?

Net working capital = current asset - Current liabilty

14 - (3 + 1 + 2)

Net working capital = $ 8 Million

Rattner had $12 million in net plant and equipment the prior year. Its net operating working capital has remained constant over time. What is the company's free cash flow (FCF) for the year that just ended?

e. Rattner had 500,000 common shares outstanding and the common stock amount on the balance sheet is $5 million. The company has not issued or repurchased common stock during last years. Last year's balance in retained earnings was $12 million and the firm paid out dividends of $1.2 million during the year. Develop Rattner's end-of-year Statement of StockHolders Equity.

End of Year Statement of Stockholders Equity

Particulars

Common Stock

5,000,000.00

Retained earnings

10,800,000.00

Total Stockholders Equity

15,800,000.00

Retained earnings =last years earnings-dividend paid

12,000,000.00-1,200,000.00=10,800,000.00

W.C. Cycling had $43,000 of cash at year-end 2011 and $23,000 in cash at year-end 2012. The firm invested in property, plant, and equipment totaling $200,000. Cash flow from financing activities totaled +$230,000. Round your answers to the nearest dollar, if necessary.

A. What was the cash flow from operating activities?

B. If accruals increased by $10,000, receivables and inventories increased by $110,000, and depreciation and amortization totaled $21,000, what was the firm's net income?

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