Cornerstones of Financial Accounting
4th Edition
ISBN: 9781337690881
Author: Jay Rich, Jeff Jones
Publisher: Cengage Learning
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Chapter A2, Problem 17E
To determine
Introduction:
There are three methods i.e. amortized
To match:
The terms with their definition or most related example.
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The Equity Method of accounting for investments:
a)
Requires the investment asset to increase proportionally with the affiliates net income
b)
Requires the investment asset to decrease proportionally with the affiliates net loss
c)
Requires the investment asset to decrease proportionally with dividends received
d)
All of the above
Show the solution in good accounting form
Calculate the following ratios based on the balance sheet, income statement and cash flow prepared in question
ROE
Return on Capital Employed (post-tax)
Net Profit Margin
EBITDA Margin
Effective Tax Rate
Operating Cost Ratio
Gross Profit Margin
Total Asset Turnover Ratio
Fixed Asset Turnover Ratio
Receivables Turnover Ratio
Leverage Ratio [Avg. Total Assets / Avg. Total Equity]
FCF / EBITDA
Interest Coverage Ratio
Debt Service Coverage Ratio
Basic EPS (Assume Face Value of each share is INR 10)
Debt : Equity Ratio
Income Statement (INR Cr)
Units
Mar/14
Saleable Units
4,570
Revenues
Gross Revenues
INR Cr
2,116
Less: Environment Cess
INR Cr
5
Net Revenues
INR Cr
2,121
Growth (%)
-1.9%
Expenses
O&M Expenses (% of Project Costs)
INR Cr
146
YoY Escalation
5.72%
EBITDA
INR Cr
1,974
Margin (%)
93.1%
Book Depreciation
INR Cr
439
Interest Expenses
INR…
Chapter A2 Solutions
Cornerstones of Financial Accounting
Ch. A2 - How do long-term investments differ from...Ch. A2 - Prob. 2DQCh. A2 - Prob. 3DQCh. A2 - Prob. 4DQCh. A2 - Prob. 5DQCh. A2 - Prob. 6DQCh. A2 - Prob. 7DQCh. A2 - How does the equity method discourage the...Ch. A2 - Prob. 9DQCh. A2 - Prob. 10DQ
Ch. A2 - Prob. 11DQCh. A2 - Prob. 12DQCh. A2 - Prob. 13DQCh. A2 - Prob. 14DQCh. A2 - Prob. 15DQCh. A2 - Prob. 1MCQCh. A2 - Prob. 2MCQCh. A2 - Prob. 3MCQCh. A2 - Prob. 4MCQCh. A2 - Prob. 5MCQCh. A2 - Prob. 6MCQCh. A2 - Prob. 7MCQCh. A2 - Prob. 8MCQCh. A2 - Prob. 9MCQCh. A2 - Prob. 10MCQCh. A2 - Prob. 11MCQCh. A2 - When the market value of a companys...Ch. A2 - Prob. 13MCQCh. A2 - Prob. 14MCQCh. A2 - Prob. 15MCQCh. A2 - Prob. 16MCQCh. A2 - Prob. 17ECh. A2 - Trading Securities Pear Investments began...Ch. A2 - Prob. 19ECh. A2 - Prob. 20ECh. A2 - Adjusting the Allowance to Adjust Trading...Ch. A2 - Prob. 22ECh. A2 - Prob. 23ECh. A2 - Prob. 24ECh. A2 - Prob. 25ECh. A2 - Prob. 26ECh. A2 - Prob. 27ECh. A2 - Prob. 28ECh. A2 - Prob. 29ECh. A2 - Prob. 30E
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