Problem 5. NGIWI Inc. has shown the following details as of yearend:ARP200 000Interest payable in 3 mos.25 000AP80 000Inventory440 000Bonds payable due in 10 yrs.500 000Land800 000Cash100 000Notes payable due in 6 mos.250 000NGIWI Inc. will use cash to pay 50% of the accounts payable.What will happen to the current ratio and the acid test/quick ratio? (Just indicate INCR/DECR)

Current Ratio The purpose of calculating the current ratio of the business of the current liquidity…

Answered: Problem 5. NGIWI Inc. has shown the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Consider the following balance sheet for Whiz Financial Services Limited: Assets K Liabilities K Cash 6.25 Equity 25.00 Short term consumer loans (1 yr maturity) 62.50 Demand deposits 50.00 Long term consumer loans (2 yr maturity) 31.25 31.25 Client Savings accounts 37.50 3 month T-Bills 37.50 3 month CDs 50.00 6 month T-Bills 43.75 3 months Bankers Acceptances 25.00 3 year T-Bonds 75.00 6 month commercial paper 75.00 10 year, fixed rate mortgages 25.00 1 year time deposits 25.00 30- year floating rate mortgages 50.00 2-year time deposits 50.00 premises 6.25 - Total 337.50 337.50 Required:A. Calculate the value of the rate sensitive assets, rate sensitive liabilities and therepricing gap over the next year. B. Calculate the expected change in the net interest income for the bank if interestrates rise by 1 percent on both rate sensitive…
Complete the following table: (Use Table 15.1.) (Do not round intermediate calculations. Round your answers to the nearest cent.) First Payment Broken Down Into— Selling price Down payment Amount mortgage Rate Years Monthly payment Interest Principal Balance at end of month $221,000 $44,200 7.00 % 15
You are told that a note has repayment terms of $1,700 per quarter for 6 years, with a stated interest rate of 8%. How much of the total payment is for principal, and how much is for interest? Calculate using (a) financial calculator or (b) Excel function PV. (Round answers to 2 decimal places, eg. 5,275.25.) Total payment for principal Total interest Determine if the total interest will be higher or lower than with an annual payment. The total interest will be than with an annual payment.
Assume that you start with a balance of $3900 on your credit card. During the first month, you charge $400, and during the second month, you charge $650. Assume that your credit card charges a 27% APR and that each month you make only the minimum payment of 2.5% of the balance. Complete the following table. (Round your answers to the nearest cent.) Previous Balance Finance Charge(+) Purchases(+) Payments(-) New Balance Month 1 3900 Correct. 87.75 Correct. 400 Correct. 97.50Correct. 3890.25 incorrect. Month 2 3890.25 Incorrect. 87.52 Incorrect. 650 Correct. 97.25Incorrect. 3880.27Incorrect.
When $8,600 is invested in a savings account paying simple interest for the year, the interest, i in dollars, can obtained from the equation i=8,600r, where r is the rate of interest in decimal form. Graph i=8,600r, for r up to including a rate of 16%. If the rate is 7%, how much interest is earned? OA. $6,020 OB. $602 O C. $586 OD. $622 I
10. A payday loan business in town charges $3 interest per two week on a $200 loan. The effective interest rate on this loan is A. 39% B. 47.27% C.52.1% D. None of those 11. Consider the cash flows in the table bolow: Year 0 1 2 3 4 $80 5 $140 Cash Flow $100 $50 $60 $70 Which one of the following is correct for this cash flow (circle)? A. 100 50+ 10(A/G, i, 5) +50(P/F, 4, 5) B. (50(P/A, 4, 5)+10(P/G, 4, 5)+50(P/F, i, 5))/(100)=1 C. 100(P/A, 1, 5)=50+10(A/G, i, 5) D. None of the equations are correct. 12. A series of end-of-the-year cash flows of $2,000 for ten years at an annual interest rate of 8% is nearly equal to a series of end-of-the-year cash flows at 10% interest for eight years. Determine the value of the uniform amount, A (circle) A. $1,678 B. $2,515 C.$1,590 D. None of those
Enter your dollar answers rounded to the nearest two cents and precede numbers that are less than zero (0) with a minus sign (–).) Buy On Time or Pay Cash Cost of Borrowing 1. Terms of the loan a. Amount of the loan $10,000.00 b. Length of the loan (in years) 5 c. Monthly payment $188.70 2. Total loan payments made ($ per month months) $ 3. Less: Principal amount of the loan $ 4. Total interest paid over life of loan $ 5. Tax considerations: – Is this a home equity loan? no – Do you itemize deductions on your federal tax return? yes 6. What federal tax bracket are you in? 35% 7. Taxes saved due to interest deductions ($ x %) $ 8. Total after-tax interest cost on the loan $ Cost of Paying Cash 9. Annual interest earned on savings (6% x ) $ 10. Annual after-tax interest earnings ($ x %) $ 11. Total after-tax interest earnings…
Q5. First National Bank has the following balance sheet and faces a required reserve ratio on deposits of 10%: Assets Reserves $50 million Securities $50 million Loans $100 million Liabilities Deposits $150 million Bank capital $50 million 1. This banks earn $10 million as an annual after-tax profit. Calculate ROA (return on asset) and ROE (return on equity) for both banks. 2. Assume that depositors withdraw $60 million and the bank experience a $30 million loans default. How should the bank balance sheet change?
33. Following information is given about a debtor's A/C in the books of a money lender. The firm calculates interest every month by daily product method. Cal- culate simple interest at 10% p.a. Date 1st October 2009 3rd October 2009 12th October 2009 Money Borrowed 20,000 50,000 15,000 85,000 Date 8th October 2009 26th October 2009 29th October 2009 31st October 2009 Money Repaid 40,000 30,000 10,000 5,000 85,000
Given the following, determine the gross of return after interest: Days inventory outstanding (DIO) = 60 Days sales outstanding (DSO) = 45 Days payable outstanding (DPO) = 30 Average markup =19 80% of sales is on credit. All capital is borrowed at 40.4% Assume 365 days of operations. Round your answers to TWO places of decimal.
Jami's Home Repair borrows $6,000, at 13.75% interest, for 330 days. Use the exact interest method to find the amount of interest that the bank will collect. (Round to the nearest cent.) Ⓒ$600.00 Ⓒ$640.00 $745.89 Ⓒ$8,200.00
Bank B, on the other hand, makes a $105 loan at 7%, with $100 in deposits at 5% and only $10 in equity. Bank B purchases the rest of Assets as G-Bond at 5% interest rate. Bank B Loan 7% $105 G-Bond 5% ? Deposits 5% $100 Equity $10 Total Assets $? Total Equity and Deposit $110 compute ROE of Bank B= 38% 14% 13% 21% 26% 15% 16% 14%

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS