Broussard Skateboard's sales are expected to increase by 20% from $7.4 million in 2016 to $8.88 million in 2017. Its assets totaled $5 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 5%, and the forecasted payout ratio is 60%. What would be the additional funds needed? Do not round intermediate calculations. Round your answer to the nearest dollar. $
In: Finance
Broussard Skateboard's sales are expected to increase by20% from $7.0million in 2016 to $8.40million in 2017. Its assets totaled $3million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000of accounts payable, $500,000of notes payable, and $450,000of accruals. The after-tax profit margin is forecasted to be3%. Assume that the company pays no dividends. Underthese assumptions, what would be the additional funds needed for the coming year? Do not round intermediate calculations. Round your answer to the nearest dollar.
In: Finance
Broussard Skateboard's sales are expected to increase by 25% from $8.6 million in 2016 to $10.75 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 6%, and the forecasted payout ratio is 55%. What would be the additional funds needed? Do not round intermediate calculations. Round your answer to the nearest dollar.
In: Finance
Broussard Skateboard's sales are expected to increase by 25% from $8.4 million in 2016 to $10.50 million in 2017. Its assets totaled $6 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 3%, and the forecasted payout ratio is 70%. What would be the additional funds needed? Do not round intermediate calculations. Round your answer to the nearest dollar.
In: Finance
Broussard Skateboard's sales are expected to increase by 25%
from $7.8 million in 2016 to $9.75 million in 2017. Its assets
totaled $5 million at the end of 2016. Broussard is already at full
capacity, so its assets must grow at the same rate as projected
sales. At the end of 2016, current liabilities were $1.4 million,
consisting of $450,000 of accounts payable, $500,000 of notes
payable, and $450,000 of accruals. The after-tax profit margin is
forecasted to be 4%, and the forecasted payout ratio is 55%. What
would be the additional funds needed? Do not round intermediate
calculations. Round your answer to the nearest dollar.
$___________?
In: Finance
Presented here are summarized data from the balance sheets and income statements of Wiper, Inc.:
| WIPER, INC. | |||||||||
| Condensed Balance Sheets | |||||||||
| December 31, 2017, 2016, 2015 | |||||||||
| (in millions) | |||||||||
| 2017 | 2016 | 2015 | |||||||
| Current assets | $ | 829 | $ | 1,071 | $ | 933 | |||
| Other assets | 2,433 | 1,940 | 1,739 | ||||||
| Total assets | $ | 3,262 | $ | 3,011 | $ | 2,672 | |||
| Current liabilities | $ | 597 | $ | 850 | $ | 752 | |||
| Long-term liabilities | 1,638 | 1,115 | 982 | ||||||
| Stockholders’ equity | 1,027 | 1,046 | 938 | ||||||
| Total liabilities and stockholders' equity | $ | 3,262 | $ | 3,011 | $ | 2,672 | |||
| WIPER, INC | ||||||
| Selected Income Statement and Other Data | ||||||
| For the year Ended December 31, 2017 and 2016 | ||||||
| (in millions) | ||||||
| 2017 | 2016 | |||||
| Income statement data: | ||||||
| Sales | $ | 3,070 | $ | 2,933 | ||
| Operating income | 316 | 330 | ||||
| Interest expense | 104 | 85 | ||||
| Net income | 251 | 246 | ||||
| Other data: | ||||||
| Average number of common shares outstanding | 43.3 | 48.7 | ||||
| Total dividends paid | $ | 70.0 | $ | 54.3 | ||
Required:
a. Calculate return on investment, based on net income and average total assets, for 2017 and 2016. (Do not round intermediate calculations. Round your answers to 1 decimal place.)
b. Calculate return on equity for 2017 and 2016. (Round your answers to 1 decimal place.)
c. Calculate working capital and the current ratio for each of the past three years. (Enter your answers in millions (i.e., 5,000,000 should be entered as 5). Round "Current ratio" to 1 decimal place.)
d. Calculate earnings per share for 2017 and 2016. (Round your answers to 2 decimal places.)
e. If Wiper's stock had a price/earnings ratio of 12 at the end of 2017, what was the market price of the stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
f. Calculate the cash dividend per share for 2017 and the dividend yield based on the market price calculated in part e. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
g. Calculate the dividend payout ratio for 2017. (Do not round intermediate calculations.)
h. Assume that accounts receivable at December 31, 2017, totaled $329 million. Calculate the number of days' sales in receivables at that date. (Use 365 days a year. Do not round intermediate calculations.)
i. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2017 and 2016. (Round "Debt ratio" to 1 decimal place and "Debt/equity ratio" to the nearest whole percent.)
j. Calculate the times interest earned ratio for 2017 and 2016. (Round your answers to 1 decimal place.)
In: Accounting
| WIPER, INC. | |||||||||
| Condensed Balance Sheets | |||||||||
| December 31, 2017, 2016, 2015 | |||||||||
| (in millions) | |||||||||
| 2017 | 2016 | 2015 | |||||||
| Current assets | $ | 683 | $ | 915 | $ | 763 | |||
| Other assets | 2,416 | 1,923 | 1,722 | ||||||
| Total assets | $ | 3,099 | $ | 2,838 | $ | 2,485 | |||
| Current liabilities | $ | 576 | $ | 806 | $ | 713 | |||
| Long-term liabilities | 1,513 | 1,003 | 851 | ||||||
| Stockholders’ equity | 1,010 | 1,029 | 921 | ||||||
| Total liabilities and stockholders' equity | $ | 3,099 | $ | 2,838 | $ | 2,485 | |||
| WIPER, INC | ||||||
| Selected Income Statement and Other Data | ||||||
| For the year Ended December 31, 2017 and 2016 | ||||||
| (in millions) | ||||||
| 2017 | 2016 | |||||
| Income statement data: | ||||||
| Sales | $ | 3,053 | $ | 2,916 | ||
| Operating income | 299 | 313 | ||||
| Interest expense | 87 | 68 | ||||
| Net income | 200 | 195 | ||||
| Other data: | ||||||
| Average number of common shares outstanding | 41.6 | 47.0 | ||||
| Total dividends paid | $ | 53.0 | $ | 52.6 | ||
Required:
a. Calculate return on investment, based on net income and average total assets, for 2017 and 2016. (Do not round intermediate calculations. Round your answers to 1 decimal place.)
b. Calculate return on equity for 2017 and 2016. (Round your answers to 1 decimal place.)
c. Calculate working capital and the current ratio for each of the past three years. (Enter your answers in millions (i.e., 5,000,000 should be entered as 5). Round "Current ratio" to 1 decimal place.)
d. Calculate earnings per share for 2017 and 2016. (Round your answers to 2 decimal places.)
e. If Wiper's stock had a price/earnings ratio of 13 at the end of 2017, what was the market price of the stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
f. Calculate the cash dividend per share for 2017 and the dividend yield based on the market price calculated in part e. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
g. Calculate the dividend payout ratio for 2017. (Do not round intermediate calculations.)
h. Assume that accounts receivable at December 31, 2017, totaled $312 million. Calculate the number of days' sales in receivables at that date. (Use 365 days a year. Do not round intermediate calculations.)
i. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2017 and 2016. (Round "Debt ratio" to 1 decimal place and "Debt/equity ratio" to the nearest whole percent.)
j. Calculate the times interest earned ratio for 2017 and 2016. (Round your answers to 1 decimal place.)
In: Accounting
Only do Part 2 Please:
Part 2: Scheduling of Deferred Taxes
From the information below, prepare Excel schedules (similar the chapter notes) for 2015 and 2016 to calculate deferred income taxes. Remember, when preparing the 2015 schedule, you do not know about any changes that come about in 2016 (i.e., prepare the 2015 schedule with 2015 information only). Given the following information for Company Z for 2015 (in its first year of calculating deferred income taxes):
1) Company Z has one depreciable asset purchased January 2, 2015. The cost of the asset was $50,000. For financial statement purposes, Company Z is depreciating this asset over 10 years with no salvage value. For tax purposes Company Z is using MACRS, and the asset qualifies as a 5 year asset. Company Z has scheduled out the annual depreciation difference as follows:
Straight-line MACRS
Year (for financial) (for tax) Difference
2015 $5,000 $ 10,000 (5,000)
2016 5,000 16,000 (11,000)
2017 5,000 9,600 (4,600)
2018 5,000 5,760 (760)
2019 5,000 5,760 (760)
2020 5,000 2,880 2,120
2021 5,000 -0- 5,000
2022 5,000 -0- 5,000
2023 5,000 -0- 5,000
2024 5,000 -0- 5,000
2) The company recognized $18,000 for income from its equity method investment in 2015, but received only $12,000 in dividends from this investment (and recognized $12,000 in dividend income for tax purposes).
3) During 2015, Company Z recorded $14,000 as unearned subscription revenue, and plans to deliver the subscriptions in 2016. The IRS rules require that this amount be recognized as revenue in 2015.
4) The company also recognized estimated warranty expense of $6,000 in 2015. The warranties are expected to be paid out in 2017.
5) Pretax financial income was $200,000 in 2015, and a tax rate of 30 percent was enacted for the current and future years.
For 2016 (suggestion: use the blank column to record 2015 information, to reconcile totals across each line):
1) Assume that the depreciable asset continues to be depreciated on the methods above.
2) During 2016, the equity investment earned $30,000 and paid dividends to Company Z totaling $18,000. (Use a separate line in the schedule to record this new deferral.)
3) During 2016, $8,000 of the subscriptions were delivered. The balance will be delivered in 2017.
4) During 2016, $2,000 of the warranties was paid out. The balance will be settled in 2017.
5) Pretax financial income was $250,000 in 2016, and a tax rate of 40 percent was enacted for current and future years.
In: Accounting
In the UK sales of music CDs per year have declined from 60 million in 2013 to 48 million in 2016 and further to 32 million in 2018.
(a) What was the average rate of change in CD sales from 2013 to 2016 and what was the average rate of change from 2016 to 2018.
(b) Based on this data, is number of CDs sales decreasing linearly? Give a reason for your answer.
The cost of producing x solar panels is c(x) = 1000 + 500x − 20x2 (in dollars).
(a) Using the definition of the derivative from lectures, compute the marginal cost when 10 solar panels have already been produced.
(b) Compare this to the actual extra cost for producing an 11th solar panel.
(c) Work out the equation for the tangent to the graph of c(x) at x = 10.
In: Advanced Math
Williams-Santana, Inc., is a manufacturer of high-tech industrial parts that was started in 2004 by two talented engineers with little business training. In 2016, the company was acquired by one of its major customers. As part of an internal audit, the following facts were discovered. The audit occurred during 2016 before any adjusting entries or closing entries were prepared. The income tax rate is 40% for all years.
a. A five-year casualty insurance policy was purchased at the beginning of 2014 for $34,000. The full amount was debited to insurance expense at the time.
b. Effective January 1, 2016, the company changed the salvage value used in calculating depreciation for its office building. The building cost $592,000 on December 29, 2005, and has been depreciated on a straightline basis assuming a useful life of 40 years and a salvage value of $100,000. Declining real estate values in the area indicate that the salvage value will be no more than $25,000.
c. On December 31, 2015, merchandise inventory was overstated by $24,000 due to a mistake in the physical inventory count using the periodic inventory system.
d. The company changed inventory cost methods to FIFO from LIFO at the end of 2016 for both financial statement and income tax purposes. The change will cause a $950,000 increase in the beginning inventory at January 1, 2017
. e. At the end of 2015, the company failed to accrue $15,300 of sales commissions earned by employees during 2015. The expense was recorded when the commissions were paid in early 2016.
f. At the beginning of 2014, the company purchased a machine at a cost of $700,000. Its useful life was estimated to be ten years with no salvage value. The machine has been depreciated by the double-declining balance method. Its book value on December 31, 2015, was $448,000. On January 1, 2016, the company changed to the straight-line method.
g. Warranty expense is determined each year as 1% of sales. Actual payment experience of recent years indicates that 0.75% is a better indication of the actual cost. Management effects the change in 2016. Credit sales for 2016 are $3,800,000; in 2015 they were $3,500,000. Required: For each situation:
|
Prepare any journal entry necessary as a direct result of the change or error correction as well as any adjusting entry for 2016 related to the situation described. Any tax effects should be adjusted for through Income tax payable or Refund-income tax. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) a(1), a(2), b(1),b(2), c(1), c(3) , d(1), d(2), e(1), e(2) , f(1), f(2), g(1), g(2) |
In: Accounting