Chapter 6 Solutions for Home Tasks Fundamentals of Corporate Finance Fifth Edition, Ross, Westerfield, Jordan
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Task 3Net income = 51 350Cash dividends = 15 000Addition to retained earnings = Net income – Cash dividends = 51 350 – 15 000 = 36 350Task 4Earnings per share = Net income/Total share outstanding = 51 350/20 000 = 2,5675Dividends per share = Cash Dividends/Total share outstanding = 15 000/20 000 = 0,75Task 5Current assets = Net working Capital + Current liabilities = 600 000 + 750 000 = 1 350 000Book value current assets = 1 350 000Book value net fixed assets = 750 000Book value assets = 1 350 000 + 750 000 = 2 100 000Market value current assets = 1 500 000Market value net fixed assets = 2 000 000Market value assets = 1 500 000 + 2 000 000 = 3 500 000Task 6Tax rate = 39%Taxable income = 145 000Income taxes:0,15 * 50 000 = 7 5000,25 * (75 000 – 50 000) = 6 2500,34 * (100 000 – 75 000) = 8 5000,39 * (145 000 – 100 000) = 17 550Total income tax = 1 + 2 + 3 + 4 = 39 800Task 7Average tax rate = Total income tax/Net income = 39 800/145 000 = 27,45%Marginal tax rate = 39%Task 11Cash flow to cresitors = Interest paid – Net new borrowing = 700000-900000=-200000Task 12Cash flow to stockholders= Dividents paid – Net New equity raised = 300000-450000=-150000
Task 13Відповіді з 11 і 12 разом формують cash flow from assets. OCF = Net capital spending + Change in NWC + cash flow from assets = 500000-135000-200000-150000=15000Task 1465 000 – 41 000 – 3 000 – 1 750 = 19 250 EBIT19 250 – 7 000 = 12 250 Taxable income12 250 – 4 165 = 8 085 Net incomea. OCF = 19 250 + 3 000 – 4 165 = 18 085b. Cash Flow to Creditors = Interest – Net new borrowings = 7 000 – (– 3 000) = 10 000c. Cash Flow to Stockholders = Dividends – Net new Equity = 3 200 – 1 415 = 1 785d. CFA = CFC + CFS = 10 000 + 1 785 = 11 785Net capital Spending = Increase in NFA + Depreciation = 2 500 + 3 000 = 5 500CFA = OCF – Net capital Spending – Change in NWC Change in NWC = OCF – Net capital Spending – CFA = 18 085 – 5 500 – 11 785 = 800Task 16Balance Sheet (PIECE OF SHIT!!!)))Cash = 200 000Accounts payable = 500 000Accounts receivable = 105 000Notes payable = 125 000Inventory = 330 000Current liabilities = 625 000Current assets = 635 000Long-term debt = 525 000 Total liabilities = 1 150 000Tangible net fixed assets = 3 000 000Intangible net fixed assets = Patents and copyrights = 525 000Common stock = 260 000Accumulate retained earnings = 2 750 000Total assets = 4 160 000Total liabilities and owners’ equity = 4 160 000Common stock = Total liabilities and owners’ equity – Accumulate retained earnings – Total liabilities = 260 000Task 17Credit debt = 2 200Shareholders’ equity = Max [(Total assets – Total Liabilities), 0]If Total Assets = 2 400; Shareholders’ equity = 200If Total Assets = 2 400; Shareholders’ equity = 0Task 18Taxable income(Growth) = 85 000Income taxes:0,15 * 50 000 = 7 5000,25 * (75 000 – 50 000) = 6 2500,34 * (85 000 – 75 000) = 3 400Total income tax (Growth) = 1 + 2 + 3 = 17 150Taxable income (Income)= 1 000 000