Question
In: Finance
I You have a bike store. Your assets consist of $10,400 in inventory, $1,000 in equipment...
I You have a bike store. Your assets consist of $10,400 in inventory, $1,000 in equipment (phones, computers, etc.) and $600 cash. You are capitalized with $10,000 owners’ equity and $2,000 debt at 6%. Assume your only variable cost are the bikes you purchase from the manufacturer, $60/bike. Your fixed costs total $2500.
During the year you purchased 250 bikes and sold them at $80/bike. But you only paid for half the bikes you bought; the rest were sold to you “on credit.” Your profits tax rate is 20%. What is your ROE for the year?
You “took out” all the profits. Do the “money in – money out” to calculate the net change in cash for the year. What does your balance sheet look like at the end of the year?
Solutions
jeff jeffy answered 1 year agoRelated Solutions
IYou have a bike store. Your assets consist of $10,400 in inventory, $1,000 in equipment (phones,...
IYou
have a
bike
store. Your assets
consist of $10,400 in inventory,
$1,000
in equipment (phones, computers, etc.) and $600 cash. You are capitalized
with $10,000 owners’ equity and $2,000 debt at 6%. Assume
your only
variable cost are the bikes you purchase from the manufacturer, $60/bike. Your fixed costs total
$2500.
During
the year you purchased 250 bikes and sold them at
$80/bike. But you only paid for half the bikes you
bought; the rest were sold to you...
You have a bike store. Your assets consist of $10,400 in inventory, $1,000 in equipment (phones,...
You have a bike store. Your assets consist of $10,400 in
inventory, $1,000 in equipment (phones, computers, etc.) and $600
cash. You are capitalized with $10,000 owners’ equity and $2,000
debt at 6%. Assume your only variable cost are the bikes you
purchase from the manufacturer, $60/bike. Your fixed costs total
$2500. During the year you purchased 250 bikes and sold them at
$80/bike. But you only paid for half the bikes you bought; the rest
were sold to you...
The assets of Dallas & Associates consist entirely ofcurrent assets and net plant and equipment,...
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment, and the firm has no
excess cash. The firm has total assets of $2.6 million and net
plant and equipment equals $2.3 million. It has notes payable of
$160,000, long-term debt of $749,000, and total common equity of
$1.5 million. The firm does have accounts payable and accruals on
its balance sheet. The firm only finances with debt and common
equity, so it has...
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment,...
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment, and the firm has no
excess cash. The firm has total assets of $2.7 million and net
plant and equipment equals $2.4 million. It has notes payable of
$160,000, long-term debt of $755,000, and total common equity of
$1.45 million. The firm does have accounts payable and accruals on
its balance sheet. The firm only finances with debt and common
equity, so it has...
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment....
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment. The firm has total
assets of $2.8 million and net plant and equipment equals $2.5
million. It has notes payable of $140,000, long-term debt of
$745,000, and total common equity of $1.55 million. The firm does
have accounts payable and accruals on its balance sheet. The firm
only finances with debt and common equity, so it has no preferred
stock on its balance sheet....
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment....
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment. The firm has total
assets of $2.8 million and net plant and equipment equals $2.5
million. It has notes payable of $140,000, long-term debt of
$745,000, and total common equity of $1.55 million. The firm does
have accounts payable and accruals on its balance sheet. The firm
only finances with debt and common equity, so it has no preferred
stock on its balance sheet....
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment,...
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment, and the firm has no
excess cash. The firm has total assets of $2.7 million and net
plant and equipment equals $2.3 million. It has notes payable of
$150,000, long-term debt of $748,000, and total common equity of
$1.55 million. The firm does have accounts payable and accruals on
its balance sheet. The firm only finances with debt and common
equity, so it has...
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment,...
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment, and the firm has no
excess cash. The firm has total assets of $2.7 million and net
plant and equipment equals $2.3 million. It has notes payable of
$140,000, long-term debt of $752,000, and total common equity of
$1.55 million. The firm does have accounts payable and accruals on
its balance sheet. The firm only finances with debt and common
equity, so it has...
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment,...
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment, and the firm has no
excess cash. The firm has total assets of $2.6 million and net
plant and equipment equals $2.2 million. It has notes payable of
$150,000, long-term debt of $758,000, and total common equity of
$1.5 million. The firm does have accounts payable and accruals on
its balance sheet. The firm only finances with debt and common
equity, so it has...
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment....
The assets of Dallas & Associates consist entirely of
current assets and net plant and equipment. The firm has total
assets of $2.5 million and net plant and equipment equals $2.2
million. It has notes payable of $155,000, long-term debt of
$752,000, and total common equity of $1.45 million. The firm does
have accounts payable and accruals on its balance sheet. The firm
only finances with debt and common equity, so it has no preferred
stock on its balance sheet....
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