Wednesday, November 13, 2019

A firm generated net income of $862. The depreciation expense was $47 and dividends were paid in the amount of $25


A firm generated net income of $862. The depreciation expense was $47 and dividends were paid in the amount of $25. Accounts payables decreased by $13, accounts receivables increased by $28, inventory decreased by $14, and net fixed assets decreased by $8. There was no interest expense. What was the net cash flow from operating activity? 
 
A. 
$776

B. 
$802

C. 
$882

D. 
$922

E. 
$930
Net cash from operating activities = $862 + $47 - $13 - $28 + $14 = $882


50.
A firm has sales of $2,190, net income of $174, net fixed assets of $1,600, and current assets of $720. The firm has $310 in inventory. What is the common-size statement value of inventory? 
 
A. 
13.36 percent

B. 
14.16 percent

C. 
19.38 percent

D. 
30.42 percent

E. 
43.06 percent
Common-size inventory = $310/($1,600 + $720) = 13.36 percent



51.
A firm has sales of $3,200, net income of $390, total assets of $4,500, and total equity of $2,750. Interest expense is $50. What is the common-size statement value of the interest expense? 
 
A. 
0.89 percent

B. 
1.56 percent

C. 
3.69 percent

D. 
10.26 percent

E. 
14.55 percent
Common-size interest = $50/$3,200 = 1.56 percent



52.
Last year, which is used as the base year, a firm had cash of $52, accounts receivable of $218, inventory of $509, and net fixed assets of $1,107. This year, the firm has cash of $61, accounts receivable of $198, inventory of $527, and net fixed assets of $1,216. What is the common-base year value of accounts receivable? 
 
A. 
0.08

B. 
0.10

C. 
0.88

D. 
0.91

E. 
1.18
Common-base year accounts receivable = $198/$218 = 0.91

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