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1-A company had cash and marketable securities worth $100,000 accounts payables worth $60,000 inventory of $2,501,500, accounts receivables of $5.500,000 short-term notes payable worth $200,000, other current liabilities of 100,000, and other current assets of $212,800. Calculate the company net working capital and describe how managers manage the firm working capital.

1-A company had cash and marketable securities worth $100,000 accounts payables worth $60,000 inventory of $2,501,500, accounts receivables of $5.500,000 short-term notes payable worth $200,000, other current liabilities of 100,000, and other current assets of $212,800. Calculate the company net working capital and describe how managers manage the firm working capital.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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QC 23.

1-A company had cash and marketable securities worth $100,000 accounts payables worth $60,000 inventory of $2,501,500, accounts receivables of $5,500,000 short-term notes payable worth $200,000, other current liabilities of 100,000, and other current assets of $212,800. Calculate the company net working capital and describe how managers manage the firm working capital. 2-Your parents have given you $2,500 a year before your graduation so that you can take a trip when you graduate. You wisely decide to invest the money in a bank CD that pays 8% interest. You know that the trip costs $2,600 right now and that inflation for the year is predicted to be 3%. Will you have enough money in a year to purchase the trip? Show your calculations. 3-If the following financial information related to XYZ Company. Total Revenues last year $870, depreciation expenses $40, costs of goods sold $350, and interest expenses $50. At the end of the year, current assets were $100 and current liabilities were $105. The company has an average tax rate of 30%. Calculate the net income for XYZ Company by setting up an income statement. 4-Calculate the common-size balance sheet from the following information for the company: Cash 50,000 Accts/Pay 20,800 55,000 Accrued expenses 40,000 300,500 Short-term N/P 9,700 405,500 Current liabilities 70,500 102,000 Long-term debt 70,000 507,500 Total liabilities 140,500 Owner's equity 367,000 Total liabilities and owners' equity 507,500 5-ten years ago, Amanda Cortez invested $20,000 in an account paying an annual interest rate of 5%. What is the value of the investment today? What is the interest on interest earned on this investment? Acct/Rec Inventories Total Current assets Net fixed assets Total assets 6-You have just won a lottery that promises an annual payment of $130,000 beginning immediately. You will receive a total of 12 payments. If you can invest the cash flow in an investment that is paying 7% annually, what is the present value of this annuity? 7-What are the five important accounting principles that company follow when writing their financial statements. Using your own words, explain each principle
Transcribed Image Text:1-A company had cash and marketable securities worth $100,000 accounts payables worth $60,000 inventory of $2,501,500, accounts receivables of $5,500,000 short-term notes payable worth $200,000, other current liabilities of 100,000, and other current assets of $212,800. Calculate the company net working capital and describe how managers manage the firm working capital. 2-Your parents have given you $2,500 a year before your graduation so that you can take a trip when you graduate. You wisely decide to invest the money in a bank CD that pays 8% interest. You know that the trip costs $2,600 right now and that inflation for the year is predicted to be 3%. Will you have enough money in a year to purchase the trip? Show your calculations. 3-If the following financial information related to XYZ Company. Total Revenues last year $870, depreciation expenses $40, costs of goods sold $350, and interest expenses $50. At the end of the year, current assets were $100 and current liabilities were $105. The company has an average tax rate of 30%. Calculate the net income for XYZ Company by setting up an income statement. 4-Calculate the common-size balance sheet from the following information for the company: Cash 50,000 Accts/Pay 20,800 55,000 Accrued expenses 40,000 300,500 Short-term N/P 9,700 405,500 Current liabilities 70,500 102,000 Long-term debt 70,000 507,500 Total liabilities 140,500 Owner's equity 367,000 Total liabilities and owners' equity 507,500 5-ten years ago, Amanda Cortez invested $20,000 in an account paying an annual interest rate of 5%. What is the value of the investment today? What is the interest on interest earned on this investment? Acct/Rec Inventories Total Current assets Net fixed assets Total assets 6-You have just won a lottery that promises an annual payment of $130,000 beginning immediately. You will receive a total of 12 payments. If you can invest the cash flow in an investment that is paying 7% annually, what is the present value of this annuity? 7-What are the five important accounting principles that company follow when writing their financial statements. Using your own words, explain each principle
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