Solutions Manual For Cfin 6th Edition Besley Solutions-Books Pdf

SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY SOLUTIONS
03 Jul 2020 | 2 views | 0 downloads | 34 Pages | 362.09 KB

Share Pdf : Solutions Manual For Cfin 6th Edition Besley Solutions

Download and Preview : Solutions Manual For Cfin 6th Edition Besley Solutions


Report CopyRight/DMCA Form For : Solutions Manual For Cfin 6th Edition Besley Solutions



Transcription

SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY, Chapter 2 CFIN6. Chapter 2 Solutions, 2 1 Publically traded companies are required to provide adequate financial information to their shareholders. Information generally is provided through financial reports that a company periodically produces which. include a balance sheet an income statement a statement of cash flows and a statement of retained. earnings In addition the reports published by a company contain discussions of the firm s operations both. present and forecasted Each of the financial statements provides different types of information But. because it incorporates information from both the income statement and the balance sheet the statement. of cash flow provides the best information for investors. 2 2 a The balance sheet shows at a particular point in time the amount the firm has invested in assets and. how much of those investments are financed with loans liabilities and how much are financed with equity. stock b The income statement shows the revenues sales that the firm generated during a particular. period and the expenses that were incurred during that same period whether those expense were incurred. as the result of normal operations or as the result of how the firm is financed c The statement of cash. flows shows how the firm generated cash inflows and how the firm used cash outflows during a particular. accounting period If the firm uses more cash than it generates through normal operations it is deficit. spending and deficit spending must be financed with external funds either stocks or debt. 2 3 The most important aspect of ratio analysis is the judgment used when interpreting the results to reach. conclusions concerning a firm s current financial position and the direction in which the firm is headed in the. future The analyst should be aware of and include in the interpretation the fact that 1 large firms with. many different divisions are difficult to categorize into a single industry 2 financial statements are reported. at historical costs 3 seasonal factors can distort the ratios 4 some firms try to window dress their. financial statements to look good 5 firms use different accounting procedures to compute inventory. values depreciation and so on 6 there might not exist a single value that can be used for comparing. firms ratios e g a current ratio of 2 0 might not be good for some firms and 7 conclusions concerning. the overall financial position of a firm should be based on a representative number of ratios not a single. 2 4 Shares issued 100 000 Price per share 7 Par value per share 3. Common stock at par 300 000 3 x 100 000, Paid in capital 400 000 7 3 x 100 000 700 000 300 000. 2 5 Net cash flow Net income Depreciation 90 000 25 000 115 000. 2 6 The income statement for HighTech Wireless with the information that is given in the problem. Operating expenses excluding depreciation 500 000, Depreciation 100 000. Interest 0 HighTech has no debt, Earnings before taxes EBT.
Net income NI 240 000, 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, Starting with net income and working up the income statement to solve for sales we have the. following computations, 1 NI EBT 1 0 4, Net income 240 000. Thus EBT 400 000, 1 Tax rate 1 0 40, Taxes 400 000 240 000 160 000.
2 EBIT EBT Interest 400 000 0 400 000, 3 Sales EBIT Operating expenses excluding depreciation Depreciation. 400 000 500 000 100 000 1 000 000, To show that this is the correct result let s start with sales equal to 1 000 000 and compute the. net income, Sales 1 000 000, Operating expenses excluding depreciation 500 000. Depreciation 100 000, EBIT 400 000, Interest 0, Earnings before taxes EBT 400 000. Taxes 40 160 000, Net income 240 000, Net cash flow Net income Depreciation 240 000 100 000 340 000.
2 7 a Current 3 5 Current assets 73 500, ratio Current liabilities Current liabilities. Current liabilities 21 000, b Quick 3 0 Current assets Inventory 73 500 Inventory. ratio Current liabilities 21 000, Inventory 73 500 3 0 21 000 10 500. Sales Sales, 2 8 a Total assets turnover 2 0, Total assets 150 000. Sales 2 0 150 000 300 000, Net income Net income, b Return on assets 0 06.
Total assets 150 000, Net income 0 06 150 000 9 000. 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, Net income 9 000, Net profit margin 0 03 3 0. Sales 300 000, Net income Net income, 2 9 a ROA 0 05. Total assets 300 000, Net income 0 05 300 000 15 000.
Net income 15 000 15 000, b Return on equity 0 15 15 0. Common equity 300 000 200 000 100 000, Alternative solution. Net income Total assets, Return on equity ROA, Common equity Common equity. 0 05 0 05 3 0 0 15 15 0, 300 000 200 000, 2 10 a Debt ratio 40. Proportion of firm Common equity Common equity, 1 0 40 0 6 60.
financed with common stock Total assets 750 000, Common equity 750 000 0 6 450 000. Net income Sales Net income, Total assets Total assets Sales. Net income, Net income 0 06, 0 02 2 0 Net profit margin. Alternative solution, Total assets Sales Sales, turnover Total assets 750 000. Sales 3 750 000 2 250 000, Net income Net income, Total assets 750 000.
Net income 0 06 750 000 45 000, Net profit Net income 45 000. margin Sales 2 250 000, 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, Sales Sales, 2 11 a Total assets turnover 2 5. Total assets 10 000, Sales 2 5 10 000 25 000, Net income Net income.
b Return on assets 0 04, Total assets 10 000, Net income 0 04 10 000 400. Net income 400, Net profit margin 0 016 1 6, Sales 25 000. Alternative solution, Sales Net income, Return on assets. Total assets Sales, Net income, Net income 0 04, 0 016 1 6 Net profit margin. Current assets 340 000, 2 12 1 Current ratio 5 0, Current liabilities Current liabilities.
Current liabilities 340 000 5 0 68 000, Current assets Inventories 340 000 Inventories. 2 Quick ratio 1 8, Current liabilities 68 000, Inventories 340 000 1 8 68 000 340 000 122 400 217 600. 3 Current assets Cash Equivalents Accounts receivable Inventories. 340 000 43 000 Accounts receivable 217 600, Accounts receivable 340 000 43 000 217 600 79 400. Cost of goods sold CGS, 4 Inventory turnover 7 0, Inventory 217 600. CGS 7 217 600 1 523 200, 5 CGS 0 80 Sales thus Sales 1 904 000.
Accounts receivable 79 400, 6 DSO 15 0 days, Sales 360 1 904 000 360. 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, 2 13 a TIE EBIT INT so find EBIT and INT. Interest 200 000 x 0 06 12 000, Net income 540 000 x 0 04 21 600. Net income Taxable income 1 T, Taxable income EBT 21 600 1 T 21 600 1 0 4 36 000.
EBIT 36 000 12 000 48 000, TIE 48 000 12 000 4 0 x. b For TIE to equal 6 0 EBIT 6 0 12 000 72 000, When EBIT 72 000 Net income 72 000 12 000 1 0 40 36 000. Because NI 0 04 Sales Sales 36 000 0 04 900 000, Check When Sales 900 000 NI 900 000 x 0 04 36 000. EBT 36 000 1 0 40 60 000, EBIT 60 000 12 000 72 000. TIE 72 000 12 000 6 0, 2 14 We are given Common equity 35 000 000 Common shares outstanding 7 000 000.
Market price per share 8 Net income 14 000 000, a EPS 14 000 000 7 000 000 2. P E ratio 8 2 4 0, b Book value per share 35 000 000 7 000 000 5. M B ratio 8 5 1 6, 2 15 We are given ROE 15 TA turnover Sales Total assets 2 0x. Debt Ratio 60, a From DuPont equation ROE ROA x Equity multiplier. 0 15 ROA x Total assets Common equity, Recognize that Total assets Common equity is simply the inverse of the proportion of the firm that is.
financed with equity The proportion of the firm that is financed with equity equals 1 Debt ratio Thus. 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, 1 Debt ratio, ROA 0 15 2 5 0 06 6 0. b ROA Net profit margin x Total assets turnover, 0 06 Net profit margin x 2 0. Net profit margin 0 06 2 0 0 03 3 0, Alternative solution. TA turnover Sales Total assets 2 0x thus Sales 2 0 Total assets. ROE Net income Common equity Net income 1 0 6 Total assets 0 15 thus. Net income 0 15 0 4 Total assets 0 06 Total assets. Net income 0 06 Total assets 0 06, PM 0 03 3 0, Sales 2 0 Total assets 2 0.
2 16 We are given ROA 8 Total assets 440 000, Debt Ratio 20. Net income Net income, a ROA 0 08, Total assets 440 000. Net income 0 08 440 000 35 200, b From DuPont equation ROE ROA x Equity multiplier. Total assets 1 1, Equity multiplier 1 25, Common equity 1 Debt ratio 1 0 20. Thus ROE 0 08 x 1 25 0 10 10 0, Alternative solution.
Common equity 440 000 1 0 2 352 000, Net income 35 200. ROE 0 10 10 0, Common equity 352 000, 2 17 We are given ROA 4 Current assets 260 000. Net income 140 000 Long term debt 1 755 000, assets financed with equity 35. 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, Net income 140 000, 1 ROA 0 04 Total assets 140 000 0 04 3 500 000.
Total assets Total assets, 2 Total liabilities Total assets x Debt ratio 3 500 000 1 0 35 2 275 000. 3 Current liabilities Total liabilities Long term debt 2 275 000 1 755 000 520 000. Current assets 260 000, 4 Current ratio 0 5, Current liabilities 520 000. 2 18 We are given ROA 3 ROE 5 Total assets 100 000. Net income Net income, a ROA 0 03 Net income 100 000 0 03 3 000. Total assets 100 000, Net income 3 000, b ROE 0 05 CE 3 000 0 05 60 000. Common equity Common eqiuty, Total liabilities 100 000 60 000.
Debt ratio 0 40 40, Total assets 100 000, 2 19 We are given assets financed with equity 60 Current ratio 5 0. Total assets turnover 4 0 Current assets 150 000, Sales 1 800 000. Current assets 150 000, 1 Current ratio 5 0, Current liabilities Current liabilities. Current liabilities 150 000 5 30 000, Sales 1 800 000. 2 Total assets turnover 4 0, Total assets Total assets.
Total assets 1 800 000 4 0 450 000, 3 Total liabilities 450 000 1 0 60 180 000. 4 Long term liabilities 180 000 30 000 150 000, 2 20 We are given P E ratio 15 0 Price per share 30. Fixed assets turnover 8 0 Current ratio 5 0, Current liabilities 300 000 Net profit margin 0 04. Shares of common 60 000, Pr ice per share 30, 1 P E ratio 15 0 EPS 30 15 2. Net income 60 000 2 120 000, 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in.
whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Chapter 2 CFIN6, Net income 120 000, 2 Net profit margin 0 04 Sales 120 000 0 04 3 000 000. Sales Sales, Fixed assets Sales 3 000 000, 3 8 0 Fixed assets 3 000 000 8 375 000. turnover Net fixed assets Fixed assets, Current Current assets CA. 4 5 0 Current assets 300 000 5 1 500 000, ratio Current liabilities 300 000.
5 Total assets Fixed assets Current assets 375 000 1 500 000 1 875 000. Net income 120 000, a ROA 0 064 6 4, Total assets 1 875 000. Total assets Sales 3 000 000, turnover Total assets 1 875 000. 2019 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in. whole or in part, SOLUTIONS MANUAL FOR CFIN 6TH EDITION BESLEY. Ethical Dilemma, Hocus Pocus Look An Increase in Sales. Dynamic Energy Wares DEW manufactures and distributes products that are used to. save energy and to help reduce and reverse the harmful environmental effects of. atmospheric pollutants DEW relies on a relatively complex distribution system to get the. products to its customers Large companies which account for nearly 30 of the firm s. total sales purchase directly from DEW Smaller companies and retailers that sell to. individuals are required to make their purchases from one of the 50 independent. distributors that are contractually obligated to exclusively sell DEW s products. DEW S accountants have just finished the firm s financial statements for the third quarter. of the fiscal year which ended 3 weeks ago The results are terrible Profits are down. 30 from this time last year when a downturn in sales began Profits are depressed. primarily because DEW continues to lose market share to a competitor that entered the. field nearly 2 years ago, Senior management has decided it needs to take action to boost sales in the fourth quarter.
so that year end profits will be more acceptable Starting immediately DEW will 1. eliminate all direct sales which means that large companies must purchase products from. DEW s distributors just as the smaller companies and retailers do 2 require. Paid in capital 400 000 7 3 x 100 000 700 000 300 000 2 5 Net cash flow Net income Depreciation 90 000 25 000 115 000 2 6 The income statement for HighTech Wireless with the information that is given in the problem

Related Books

INTRODUCTION TO COAL BUSINESS listed company

INTRODUCTION TO COAL BUSINESS listed company

INTRODUCTION TO COAL BUSINESS SPECIAL ANALYST MEETING April 22 2009 Coals are fossil fuels formed through the oxidation and biodegradation of plant remains db t d d COAL TYPES AND ITS CHARACTERISTICS preserved by water and mud HIGH MOISTURE CONTENT OF COAL CARBON ENERGY CONTENT OF COAL HIGH Low Rank Coals 47 Hard Coal 53 d reseres of Worl Lignite 17 Sub Bituminous 30 Bituminous 52

Guideline on Active Substance Master File Procedure

Guideline on Active Substance Master File Procedure

Guideline on Active Substance Master File Procedure Final Discussion at the HMPC November 2005 January 2006 Adoption by the HMPC 22 January 2006 Draft agreed by Quality Working Party 9 February 2006 Adoption by CHMP for release for consultation 23 March 2006 Adoption by CVMP for release for consultation 20 April 2006 End of consultation deadline f or comments 30

ANZSCO Code Information Medium and Long term Strategic

ANZSCO Code Information Medium and Long term Strategic

ACS ANZSCO Code Information Version 4 2017 Page 1 ANZSCO Code Information The ANZSCO code information is to assist applicants in nominating an ICT occupation and contains example of ICT units and employment duties for each occupation Medium and Long term Strategic Skills List MLTSSL Medium and Long term Strategic Skills List MLTSSL ANZSCO codes assessed by the ACS 261311 Analyst

NSW Energy Efficiency Action Plan

NSW Energy Efficiency Action Plan

The NSW Energy Efficiency Action Plan will place downward pressure on the cost of living for households unlock energy productivity for business and position the NSW Government to lead by example The objectives of the plan are to deliver bill savings to those most affected by recent price rises and further reduce pressure on future prices The plan will ensure the NSW Government can meet Goal

Asset Life Cycle Management Asset Management Council

Asset Life Cycle Management Asset Management Council

pl a c e 1 2 7 Re p l ac 12 0 8 Re p l a ce 2 202 9 0 R a c 5 1 R c 6 0 2 2 Re la c 2 02 3 l a 2 02 4 5 R Y 2 0 202 6 1 0 2 7 Re p l a 2 0 8 Re a 2 02 9 l 3 0 5 203 1 Replacement Year Net Present Values Millions Current Machine Depreciation Disposal Shutdown Lost Productivity Lost Productivity Lump Sum Capital Lump Sum OPEX Routine Process Routine Maintenance Replacement

Business Excellence Framework Edith Cowan University

Business Excellence Framework Edith Cowan University

2010 Australian Business Excellence Awards Application Form 1 Address Organisation Name Facilities and Services Centre Edith Cowan University Address 270 Joondalup Drive City JOONDALUP State WA Postcode 6017 Phone 08 134 328 Website www ecu edu au ABN 54 361 485 361 2 Awards Contact Title Mrs First Name Denise Last Name ALLISON Position Coordinator Quality Management System Phone 08 6304

Presentation of Financial Statements

Presentation of Financial Statements

Australian Accounting Standard AASB 101 Presentation of Financial Statements as amended is set out in paragraphs 1 Aus126 7 and the Appendix All the paragraphs have equal authority Terms defined in this Standard are in italics the first time they appear in the Standard AASB 101 is to be read in the context of other Australian Accounting Standards including AASB 1048 Interpretation

How Parents and Families Support Alphabet Knowledge and

How Parents and Families Support Alphabet Knowledge and

How Parents and Families Support Alphabet Knowledge and Early Writing 3 Some ways parents and family members support babies Alphabet Knowledge and Early Writing At Home Nine month old Mason is playing with a ball a plastic bowl and a cereal box while his mother and brother Alex sit with him What is he doing Aelx asks He s

EWE O P L WORKBOOK Live Lingua

EWE O P L WORKBOOK Live Lingua

friends host families and counterparts The training staff invites you to share your comments in the event that it becomes necessary to revise the material Any kind of feedback would be most welcomed Send it to Peace Corps Togo Training Manager PO Box 3194 Lom Togo Have fun and enjoy using this manual Hosted for free on livelingua com iii Table of Contents Page Acknowledgement

Pronunciation at a Glance English Online Inc

Pronunciation at a Glance English Online Inc

Pronunciation at a Glance Judy Thompson English Online Webinar Winnipeg Canada The Problem with English Letters don t represent sounds No one knows what words sound like from reading them blue through you who two do few shoe due boo The Presentation 1 A short History of English showing speaking as a different language than writing 2 The Sounds of English 1 Consonants sounds that

Advent Candle Lighting Readings World Vision Canada

Advent Candle Lighting Readings World Vision Canada

Advent Candle Lighting Readings The custom of lighting candles each week of Advent is familiar to many Christian traditions Symbolically the light represents Jesus as the promised light of the world With each successive week an additional candle is lit culminating on Christmas Eve Day when the full brightness of all the candles burn to remind us that Jesus has come and is leading us forth