Statement of
Equity investments: The financial instruments which claim ownership in the issuing company and pay a dividend revenue to the investor company, are referred to as equity securities. The investments in equity securities are referred to as equity investments.
To Determine: The pretax amount related to lease reported by Company B in the statement of cash flow for the year ended December 31, 2018.
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- balance sheet 20201231 (mkr): fixed assets 9540 current assets 2630 s: a assets. 1280 equity 2070 long loans 5650 short-term. liabilities. 4360 s: a EQ and liabilities 12080 Let us assume that a new share issue is carried out where the owners invest SEK 1,400 million. The money is then used to repay long-term loans of SEK 900 million and short-term liabilities of SEK 400 million. Your task is to fill in the amounts for the following items in the balance sheet after the new share issue and associated transactions described above have been completed: S assets:mkr Equity:mkr Short loans:mkrarrow_forwardAdditional short-term borrowings Purchase of short-term stock investments Cash dividends paid Interest paid $ 20,000 5,000 16,000 8,e00 Compute cash flows from financing activities using the above company information. (Amounts to be deducted should be indicated by a minus sign.) Financing Activities $ 8:30 PM 3/27/2022 Insert Prt Sc F7 F8 F9 F10 F11 F12 F3 F4 F5 F6 Lock + &arrow_forwardFind the value of XYZ Co’s equity share by using free cash flow to firm (FCFF) approach with the help of following information. SOURCES OF FUNDS 2020-2021 APPLICATION OF FUNDS 2020-2021 Shareholders’ funds Gross fixed assets 1,100 Equity share capital (12 crore shares of Rs.10 each) 120 Less: accumulated depreciation 400 Reserves and Surplus 280 Net fixed assets 700 10% Loan 600 Net working capital 300 1,000 1,000 The EBIT of XYZ for 2020-2021 is Rs.250 crore. Depreciation for the year is Rs. 70crore The company is subject to 40% tax rate. The growth in sales, depreciation NOPAT (net operating profit after tax), gross fixed assets and net working capital will be 18% for the first three years, 10% for the next two years and 7% thereafter. There will be no change in the tax rate and present debt ratio. The expected rate of return of equity shareholders is 16%arrow_forward
- 29arrow_forwardLO 3 E3.14 Identification of Variable Interest Entity and Primary Beneficiary Softek Corporation forms a separate legal entity, Startek, to develop new technology. The entity is funded by $4,000,000 in outside equity and $26,000,000 in debt. Softek guarantees Startek's debt. The entity is expected to generate the following cash flows at the end of one year: Cash Flow $11,000,000 33,000,000 55,000,000 A discount rate of 10 percent is appropriate. Required b. Probability 0.40 0.20 0.40 a. Assume qualitative analysis of Startek's VIE status is inconclusive. Quantitatively analyze whether Startek is a variable interest entity. Assume Startek is a variable interest entity. Identify the factors that determine whether Softek is the primary beneficiary that must consolidate Startek.arrow_forwardDon't give answer in image formatarrow_forward
- pls answer this thank youarrow_forwardPlease explain.arrow_forwardQUESTION 2 (25 MARKS) (a) A firm has determined its optimal capital structure which is composed of the following sources and target market value proportions.Source of Capital Target Market ProportionsLong Term Debt25% Preferred Stock15% Common Stock60% Total Firm Value100%Debt:The firm can sell a 10-year, RM1,000 par value, 6% bond for RM945. 3Preferred Stock:The firm has determined it can issue preferred stock at RM70per share par value. The stock will pay a RM8annual dividend. Common Stock:A firm's common stock is currently selling for RM19per share. The dividend expected to be paid at the end of the coming year is RM1.85. Its dividend payments have been growing at a constant rate for the last four years. Four years ago, the dividend was RM1.50. Additionally, thefirm's marginal tax rate is 35%. Determine the weighted average cost of capital for the firm. (15 marks)arrow_forward
- Waldo Lt Balance sheet £m £m Non Current Assets 180 Current Assets 75 Current Liabilities (25) 50 230 Financed by: Ordinary Shares (25p) 138 Reserves 32 8% Loan notes 60 230 The realisable value of the fixed assets is estimated at £135m and the realisable value of current assets is estimated at £45m. Recent profit after tax is £37m and a sector P/E ratio is 12. Using the information above, calculate the firm value per share using the realisable value method for the shares in Waldo Ltd. Group of answer choices £0.70 or 70p per share £0.14 or 14p per share £0.17 or 17p £0.31 or 31p per sharearrow_forwardPlease no hand writing solutionarrow_forwardFree cash flow FCF Year (t) 2020 2021 2022 2023 $710,000 $850,000 $950,000 $1,090,000 Other data Growth rate of FCF, beyond 2023 to infinity = 6% Weighted average cost of capital = 9% Market value of all debt = $6,030,000 Market value of preferred stock = $2,410,000 Number of shares of common stock to be issued = 1,100,000arrow_forward
- Financial Reporting, Financial Statement Analysis...FinanceISBN:9781285190907Author:James M. Wahlen, Stephen P. Baginski, Mark BradshawPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning