Question:25 Question:25The 2020 balance sheet of Serena's Sports Gear, Inc.,showed long-term debt of $4.5 million, and the 2021balance sheet showed long-term debt of $5.1 million.The 2021 income statement showed an interestexpense of $135,000. What was the firm's cash flowto creditors during 2021?

Change in long term debt = Long term debt in 2021-Long term debt 2020Change in long term debt = 5.1…

Answered: Question:25 The 2020 balance sheet of…

Fundamentals Of Financial Management, Concise Edition (mindtap Course List)

10th Edition

ISBN:9781337902571

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter3: Financial Statements, Cash Flow, And Taxes

Section: Chapter Questions

Problem 19SP

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Ratio Analysis Rising Stars Academy provided the following information on its 2019 balance sheet and state mcnt of cash flows: Long-term debt S 4,400 Interest expense S 398 Total liabilities 8,972 Net income 559 Total assets 38,775 Interest payments 432 Total equity 29,803 Cash flows from operations 1.015 Operating income 1.223 Income tax expenses 266 Income taxes paid 150 Required: Calculate the following ratios for Rising Stars: (a) debt to equity, (b) debt to total assets, (c) long-term debt to equity, (d) times interest earned (accrual basis), and (e) times interest earned (cash basis). (Note: Round answers to three decimal places.) CONCEPTUAL CONNECTION Interpret these results. 3.What does it mean if a bond is callable
Using the Value Line Investment Survey report in Exhibit 11.5, find the following information for Apple. What was the amount of revenues (i.e., sales) generated by the company in 2017? What were the latest annual dividends per share and dividend yield? What is the earnings per share (EPS) projection for 2019? How many shares of common stock were outstanding? What were the book value per share and EPS in 2017? How much long-term debt did the company have in the third quarter of 2018?
AFN EQUATION Refer to Problem 16-1 and assume that the company had 3 million in assets at the end of 2019. However, now assume that the company pays no dividends. Under these assumptions, what additional funds would be needed for the coming year? Why is this AFN different from the one you found in Problem 16-1?
LONG-TERM FINANCING NEEDED At year-end 2019, total assets for Arrington Inc. were 1.8 million and accounts payable were 450,000. Sales, which in 2019 were 3.0 million, are expected to increase by 25% in 2020. Total assets and accounts payable are proportional to sales, and that relationship will be maintained; that is, they will grow at the same rate as sales. Arrington typically uses no current liabilities other than accounts payable. Common stock amounted to 500,000 in 2019, and retained earnings were 475,000. Arrington plans to sell new common stock in the amount of 130,000. The firms profit margin on sates is 5%; 35% of earnings will be retained. a. What were Arringtons total liabilities in 2019? b. How much new long-term debt financing will be needed in 2020? (Hint: AFN - New stock = New long-term debt.)
Interest and Income Taxes Staggs Company has prepared its 2019 statement of cash flows. In conjunction with this statement, it plans to disclose the interest and income taxes it paid during 2019. The following information is available from its 2019 income statement and beginning and ending balance sheet: Required: 1. Compute the amounts of interest paid and income taxes paid by Staggs for 2019. 2. Next Level Under IFRS, how would interest paid and income taxes paid be reported?
DIVIDENDS Brooks Sporting Inc. is prepared to report the following 2019 income statement (shown in thousands of dollars). Prior to reporting this income statement, the company wants to determine its annual dividend. The company has 320,000 shares of common stock outstanding, and its stock trades at 37 per share. a. The company had a 25% dividend payout ratio in 2018. If Brooks wants to maintain this payout ratio in 2019, what will be its per-share dividend in 2019? b. If the company maintains this 25% payout ratio, what will be the current dividend yield on the companys stock? c. The company reported net income of 1.35 million in 2018. Assume that the number of shares outstanding has remained constant. What was the companys per-share dividend in 2018? d. As an alternative to maintaining the same dividend payout ratio. Brooks is considering maintaining the same per-share dividend in 2019 that it paid in 2018. If it chooses this policy, what will be the companys dividend payout ratio in 2019? e. Assume that the company is interested in dramatically expanding its operations and that this expansion will require significant amounts of capital. The company would like to avoid transactions costs involved in issuing new equity. Given this scenario, would it make more sense for the company to maintain a constant dividend payout ratio or to maintain the same per-share dividend? Explain.
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AFN Equation Refer to Problem 9-1. Return to the assumption that the company had 5 million in assets at the end of 2018, but now assume that the company pays no dividends. Under these assumptions, what would be the additional funds needed for the coming year? Why is this AFN different from the one you found in Problem 9-1?
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Question:25 The 2020 balance sheet of Serena's Sports Gear, Inc., showed long-term debt of $4.5 million, and the 2021 balance sheet showed long-term debt of $5.1 million. The 2021 income statement showed an interest expense of $135,000. What was the firm's cash flow to creditors during 2021?