Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN: 9781337395083
Author: Eugene F. Brigham, Phillip R. Daves
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 6, Problem 12P
a)
Summary Introduction
To determine: The
b)
Summary Introduction
To determine: The net operating working capital.
c)
Summary Introduction
To determine: The amounts of total net operating capital for both years.
d)
Summary Introduction
To determine: The
e)
Summary Introduction
To determine: The
f)
Summary Introduction
To determine: The uses of FCF.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Arlington Corporation's financial statements (dollars and shares are in millions) are provided here.
a. What was net operating working capital for 2018 and 2019? Assume that all cash is excess cash; i.e., this cash is not needed for operating purposes.b. What was Arlington's 2019 free cash flow?c. Construct Arlington's 2019 statement of stockholders' equity.d. What was Arlington's 2019 EVA? Assume that its after-tax cost of capital is 10%.e. What was Arlington's MVA at year-end 2019? Assume that its stock price at December 31, 2019 was $25.
hat is the amount of Target’s total liabilities at the end of FY2023 and FY 2022 (Hint: use the Statement of FinancialPosition)?b. What percentage of Target's assets was being financed withliabilities at the end of FY 2023 and FY 2022 versus thepercentage of assets financed with shareholders' equity (Hint:use the Statement of Financial Position)?c. Comment on the change in total liabilities in $ amounts and asa percentage of total assets between 2022 and 2023. Is this apositive or negative and why?d. What is the amount of debt and interest rate for Target’slongest term debt Due 2049-2053 as of the end of FY 2023(Hint: use the chart in the Long Term Debt footnote 16)?e. Target reported Accrued and Other Current Liabilities of $6,090 as of the end of FY 2023. What was the largest
Please find: Cash Coverage Ratio, Profit Margin, Return on eq
Use information from the balance sheet and income statement to calculate the following financial ratios and the market value added (MVA).
(Whenever balance sheet numbers are used to calculate financial ratios, please ensure that you use the average of the 2019 and 2020 numbers in your calculation. To calculate MVA, you can assume that the average book value number for common stock and paid-in-surplus is the amount that the shareholders initially invested in the company.)
Chapter 6 Solutions
Intermediate Financial Management (MindTap Course List)
Ch. 6 - Prob. 2QCh. 6 - If a “typical” firm reports $20 million of...Ch. 6 - Prob. 4QCh. 6 - What is operating capital, and why is it...Ch. 6 - Explain the difference between NOPAT and net...Ch. 6 - Prob. 7QCh. 6 - Prob. 8QCh. 6 - Prob. 1PCh. 6 - Corporate bonds issued by Johnson Corporation...Ch. 6 - Prob. 3P
Ch. 6 - Talbot Enterprises recently reported an EBITDA of...Ch. 6 - Kendall Corners Inc. recently reported net income...Ch. 6 - In its most recent financial statements,...Ch. 6 - Prob. 7PCh. 6 - Prob. 8PCh. 6 - Prob. 9PCh. 6 - The Moore Corporation has operating income (EBIT)...Ch. 6 - The Berndt Corporation expects to have sales of 12...Ch. 6 - Prob. 12PCh. 6 - What effect did the expansion have on sales and...Ch. 6 - Prob. 2MCCh. 6 - Prob. 3MCCh. 6 - Prob. 4MCCh. 6 - What is Computron’s free cash flow (FCF)? What are...Ch. 6 - Calculate Computron’s return on invested capital...Ch. 6 - Cochran also has asked you to estimate Computrons...Ch. 6 - Prob. 8MCCh. 6 - Assume that a corporation has $100,000 of taxable...Ch. 6 - Prob. 10MC
Knowledge Booster
Similar questions
- Using the financial statements mentioned above estimate the annual rate of interest paid by the corporation (cost of debt). Also, find the tax rate and capitalization ratio (proportions among equity and debt). Using these values that you have found estimate the annual weighted cost of capital (WACC) of the corporation. Income statement PERIOD ENDING: 12/31/2019 Total Revenue $20,972,000 Cost of Revenue $17,755,000 Gross Profit $3,217,000 OPERATING EXPENSES Research and Development $0 Sales, General and Admin. $938,000 Non-Recurring Items $138,000 Other Operating Items $341,000 Operating Income $1,800,000 Add'l income/expense items $180,000 Earnings Before Interest and Tax $1,993,000 Interest Expense $394,000 Earnings Before Tax $1,599,000 Income Tax $326,000 Minority Interest $13,000 Equity Earnings/Loss Unconsolidated Subsidiary $0 Net Income-Cont. Operations $1,286,000 Net Income $1,273,000 Net Income Applicable to Common Shareholders…arrow_forwardREQUIRED Use the information provided below to calculate the ratios for 2021 (expressed to two decimal places) that would reflect each of the following: The time taken by the company to settle its debts with trade The amount of debt that the company uses to finance its The operational effectiveness of the company before considering interest income, interest expense and company tax. The percentage of the profit that has been put back into the What investors are willing to pay for the shares of the company with due consideration given to the profit generated by each share in the company. Comment on the FIVE (5) ratios of Oslo Limited as compared to the industry average provided in the additional information. INFORMATION The information given below was extracted from the books of Oslo Limited:…arrow_forwardYour answer is partially correct. Presented below are a number of balance sheet items for Pearl, Inc. for the current year, 2025. Goodwill Payroll taxes payable Bonds payable Discount on bonds payable Cash Land Notes receivable Notes payable (to banks) Accounts payable Retained earnings Income taxes receivable Notes payable (long-term) $ 128,520 Accumulated depreciation-equipment 181,111 Inventory Rent payable (short-term) Income taxes payable Rent payable (long-term) Common stock, $1 par value Preferred stock, $10 par value Prepaid expenses Equipment 303.520 15,180 363,520 483,520 449,220 268,520 493,520 ? Debt investments (trading) Accumulated depreciation-buildings 101,150 1,603,520 Buildings $ 292,180 243,320 48.520 101,882 483,520 203,520 153,520 91,440 1,473,520 124.520 270,380 1.643.520 Current Llabilitles Accounts Payable Notes Payable Rent Payable Payroll Taxes Payable Income Taxes Payable Total Current Llabilitles Long-term Llabilitles Discount on Bonds Payable Bonds Payable…arrow_forward
- A Comparison of Firm Performance 1 2 2013 Financials 3 Net operating revenues 4 Cost of goods sold 5 Gross profit 6 Selling, general, and administrative expense 7 Other costs 8 Operating income 9 Interest expense 10 Other income (loss) - net 11 Income before income taxes 12 Income taxes 13 Net income 14 Assets 15 Cash and cash equivalents 16 Net receivables 17 Inventories 18 Prepaid expenses and other 19 Total current assets 20 Property, plant and equipment 21 Goodwill 22 Other assets 23 Total assets 24 Liabilities and Stockholder Equity 25 Accounts payable 26 Short-term debt 27 Total current liability 28 Long-term debt 29 Other liabilities 30 Total liabilities 31 Stockholder equity 32 B Walmart 469,162 352,488 116,674 88,873 27,801 2,251 187 25,737 7,981 17,756 7,781 6,768 43,803 1,588 59,940 116,681 20,497 5,987 203,105 59,099 12,719 71,818 41,417 113,235 89,870 C Macy's 27,931 16,725 11,206 8,440 88 2,678 388 (134) 2,156 767 1,389 1,836 371 5,308 361 7,876 8,196 3,743 1,176 20,991…arrow_forwardUsing the financial statements mentioned above estimate the annual rate of interest paid by the corporation (cost of debt). Also, find the tax rate and capitalization ratio (proportions among equity and debt). Using these values that you have found estimate the annual weighted cost of capital (WACC) of the corporation.arrow_forwardUse the following information for Ingersoll, Incorporated. Assume the tax rate is 21 percent. Sales Depreciation Cost of goods sold Other expenses Interest Cash Accounts receivable Short-term notes payable Long-term debt Net fixed assets Accounts payable Inventory Dividends Cash Accounts receivable Inventory Net fixed assets Current assets Prepare a balance sheet for this company for 2020 and 2021. (Do not round intermediate calculations.) Total assets Assets Current liabilities Liabilities & Equity 2020 2021 $7,616 $8,174 1,094 1,094 2,621 2,975 621 519 510 587 5,058 5,955 725 13,083 15,601 33,490 35,144 4,195 4,068 9,400 9,660 929 1,022 INGERSOLL, INCORPORATED Balance Sheet as of December 31 2020 Total liabilities & owners' equity 3,994 4,387 772 $ 3,994 $ 4,387 9,400 2021 5,058 5,955 9,660arrow_forward
- Calculate the following profitability ratios for 2018 and 2019. a. Gross profit ratio b. Return on assets c. Profit margin d. assets turnoverarrow_forwardRhodes Corporations financial statements are shown after part f. Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions. a. What is the net operating profit after taxes (NOPAT) for 2020? b. What are the amounts of net operating working capital for both years? c. What are the amounts of total net operating capital for both years? d. What is the free cash flow for 2020? e. What is the ROIC for 2020? f. How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)arrow_forwardThe following historical information is from Assisi Community Markets. Calculate the working capital and current ratio for each year. What observations do you make, and what actions might the owner consider taking?arrow_forward
- Suppose Torche Corporation has the following revenue and expenses for 2022: Revenues of $9,100,000 Cost of Goods Sold of $2,730,000 Depreciation Expenses of $500,000 Income Taxes of $1,672,000 Interest Expenses of $180,000 Other Expenses of $600,000 Sales, General, & Administrative Expenses of $910,000 Create an income statement with amounts in thousands What is the value of Earnings Before Interest & Taxes?arrow_forwardHere are simplified financial statements for Phone Corporation in 2020: Net sales Cost of goods sold Other expenses INCOME STATEMENT (Figures in $ millions) Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes (at 21%) Net income Dividends Assets Cash and marketable securities Receivables Inventories Other current assets BALANCE SHEET (Figures in $ millions) Total current assets Net property, plant, and equipment Other long-term assets. Total assets Liabilities and shareholders' equity Payables Short-term debt Other current liabilities Total current liabilities Long-term debt and leases Other long-term liabilities Shareholders' equity Total liabilities and shareholders' equity $ 13,600 4,310 4,162 2,668 $2,460 718 $1,750 368 a. Return on equity (use average balance sheet figures) b. Return on assets (use average balance sheet figures) c. Return on capital (use average balance sheet figures) d. Days in inventory (use start-of-year balance sheet…arrow_forwardAs part of your analysis, you are required to investigate Micron Industries’ cash flows and selected ratios.Required: Using the financial statement provided on page 1: (a) Compute the following ratios for Micron Industries for 2018 and 2019:i. Return on Equity using Du Pont Identity ii. Earnings Per Share (EPS) iii. Price/Earning (P/E) Ratio iv. Book Value Per Share v. Market-to-Book Ratio (b) Calculate the following for 2019:i. Operating Cash Flowii. Net Capital Spending iii. Change in Net Working Capital iv. Cash Flow from Assets v. Cash Flow to Creditors vi. Cash Flow to Stockholdersarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning
- EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENTFundamentals Of Financial Management, Concise Edi...FinanceISBN:9781337902571Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage LearningManagerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT
Fundamentals Of Financial Management, Concise Edi...
Finance
ISBN:9781337902571
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub