CHALLENGE (Questions 20-22) Net Fixed Assets and Depreciation [LO4] On the balance sheet, the net fixed assets (NFA) account is equal to the gross fixed assets (FA) account (which records the acquisition cost of fixed assets) minus the accumulated depreciation (AD) 20. account (which records the total depreciation taken by the firm against its fixed assets). Using the fact that NFA = FA – AD, show that the expression given in the chapter for net capital spending, NFAend - NFAbez + D (where D is the depreciation expense during the year), is equivalent to FAend - FAbeg- Use the following information for Taco Swell, Inc., for Problems 21 and 22 (assume the tax rate is 21 percent): 2017 2018 Sales $16,549 $18,498 Depreciation 2,376 2,484 Cost of goods sold 5,690 6,731 Other expenses 1,353 1,178 Interest 1,110 1,325 Cash 8,676 9.247 Accounts receivable 11,488 13,482 Short-term notes payable 1,674 1,641 Long-term debt 29,060 35,229 Net fixed assets 72,770 77,610 Accounts payable 6,269 6,640 Inventory 20,424 21,862 Dividends 1,979 2,314 21. Financial Statements [LO1] Draw up an income statement and balance sheet for this company for 2017 and 2018. 22. Calculating Cash Flow [LO4] For 2018, calculate the cash flow from assets, cash flow to creditors, and cash flow to stockholders.
CHALLENGE (Questions 20-22) Net Fixed Assets and Depreciation [LO4] On the balance sheet, the net fixed assets (NFA) account is equal to the gross fixed assets (FA) account (which records the acquisition cost of fixed assets) minus the accumulated depreciation (AD) 20. account (which records the total depreciation taken by the firm against its fixed assets). Using the fact that NFA = FA – AD, show that the expression given in the chapter for net capital spending, NFAend - NFAbez + D (where D is the depreciation expense during the year), is equivalent to FAend - FAbeg- Use the following information for Taco Swell, Inc., for Problems 21 and 22 (assume the tax rate is 21 percent): 2017 2018 Sales $16,549 $18,498 Depreciation 2,376 2,484 Cost of goods sold 5,690 6,731 Other expenses 1,353 1,178 Interest 1,110 1,325 Cash 8,676 9.247 Accounts receivable 11,488 13,482 Short-term notes payable 1,674 1,641 Long-term debt 29,060 35,229 Net fixed assets 72,770 77,610 Accounts payable 6,269 6,640 Inventory 20,424 21,862 Dividends 1,979 2,314 21. Financial Statements [LO1] Draw up an income statement and balance sheet for this company for 2017 and 2018. 22. Calculating Cash Flow [LO4] For 2018, calculate the cash flow from assets, cash flow to creditors, and cash flow to stockholders.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![CHALLENGE
(Questions 20-22)
20.
Net Fixed Assets and Depreciation [LO4] On the balance sheet, the net fixed assets (NFA) account is equal to the gross
fixed assets (FA) account (which records the acquisition cost of fixed assets) minus the accumulated depreciation (AD)
account (which records the total depreciation taken by the firm against its fixed assets). Using the fact that NFA = FA –
AD, show that the expression given in the chapter for net capital spending, NFAend – NFAbez + D (where D is the
depreciation expense during the year), is equivalent to FAend – FAbeg-
Use the following information for Taco Swell, Inc., for Problems 21 and 22 (assume the tax rate is 21 percent):
2017
2018
Sales
$16,549
$18,498
Depreciation
2,376
2,484
Cost of goods sold
5,690
6,731
Other expenses
1,353
1,178
Interest
1,110
1,325
Cash
8,676
9.247
Accounts receivable
11,488
13,482
Short-term notes payable
1,674
1,641
Long-term debt
29,060
35,229
Net fixed assets
72,770
77.610
Accounts payable
6,269
6,640
Inventory
20,424
21,862
Dividends
1,979
2,314
21.
Financial Statements [LO1] Draw up an income statement and balance sheet for this company for 2017 and 2018.
22.
Calculating Cash Flow [LO4] For 2018, calculate the cash flow from assets, cash flow to creditors, and cash flow to
stockholders.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F291d7af6-5c95-48bd-a4ac-1cfc8983e8c2%2Fac124c44-9371-42af-b38f-d95999a6d7d1%2F03m138t_processed.jpeg&w=3840&q=75)
Transcribed Image Text:CHALLENGE
(Questions 20-22)
20.
Net Fixed Assets and Depreciation [LO4] On the balance sheet, the net fixed assets (NFA) account is equal to the gross
fixed assets (FA) account (which records the acquisition cost of fixed assets) minus the accumulated depreciation (AD)
account (which records the total depreciation taken by the firm against its fixed assets). Using the fact that NFA = FA –
AD, show that the expression given in the chapter for net capital spending, NFAend – NFAbez + D (where D is the
depreciation expense during the year), is equivalent to FAend – FAbeg-
Use the following information for Taco Swell, Inc., for Problems 21 and 22 (assume the tax rate is 21 percent):
2017
2018
Sales
$16,549
$18,498
Depreciation
2,376
2,484
Cost of goods sold
5,690
6,731
Other expenses
1,353
1,178
Interest
1,110
1,325
Cash
8,676
9.247
Accounts receivable
11,488
13,482
Short-term notes payable
1,674
1,641
Long-term debt
29,060
35,229
Net fixed assets
72,770
77.610
Accounts payable
6,269
6,640
Inventory
20,424
21,862
Dividends
1,979
2,314
21.
Financial Statements [LO1] Draw up an income statement and balance sheet for this company for 2017 and 2018.
22.
Calculating Cash Flow [LO4] For 2018, calculate the cash flow from assets, cash flow to creditors, and cash flow to
stockholders.
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