Please SHOW WORK***
1. Penguin Puck's, Inc has a current assets of $5100, net fixed assets of $23,800, current
liabilities of $43,000, and long-term debt of $7,400. What is the value of the shareholders' equity
account for this firm? How much is the net working capital?
5100+23800-43000-7400 = -21500, it is the shareholders equity and the net worth of the
company.
2. Klingon Widgets, Inc., purchased new cloaking machinery three years ago for $7 million.
The machinery can be sold to the Romulans today for $4.9 million. Klingon's current balance
sheet shows net fixed assets of $3.7 million, current liabilities of $1.1 million, and net working
capital of $380,000. If all the current assets were liquidated today, the company would receive
$1.6 million cash. What is the book value of Klingon's assets today? What is the market value?
Book Value = 3.7+.38 = $4.08 million
Market value = 4.9+1.6-1.1 = $5.4 million
3. Earnhardt Driving School's 2008 balance sheet showed net fixed assets of $3.4 million, and
the 2009 balance sheet showed net fixed assets of $4.2 million. The company's 2009 income
statement showed a depreciation expense of $385,000. What was the net capital spending for
2009?
4.2-3.4+.385 = $1.185 million
4. Given the information for Martha's Tennis Shop, Inc.
(2008 balance sheet: 2.6 million of long-term debt
2009 balance sheet: 2.9 million of long-term debt
2008 balance sheet: $740,000 in common stock and $5.2 million in the additional paid-in surplus
account
2009 balance sheet: $815,000 and $5.5 million in the same two accounts) suppose that you also
know that the firm's net capital spending for 2009 was $949,000 and that the firm reduced its
networking capital investment by $85,000. What was the firm's 2009 operating cash flow or
OCF?
Cash provided from operating cash flow = $85000
5. Dahlia Industries had the following operating results for 2009: sales = $22,800; cost of
goods sold = $16,050; depreciation expense = $4,050; interest expense = $1,830; dividends paid
= $1,300. At the beginning of the year, net fixed assets were $13,650, current assets were $4,800,
and current liabilities were $2,700. At the end of the year, net fixed assets were $16,800, current
assets were $5,930, and current liabilities were $3,150. The tax rate for 2009 was 34 percent
a. Net income for 2009 is $.
22800-16050-4050-1830 =$870 profit before tax – tax 295.8 = $574.2 net income
b. The operating cash flow for 2009 is $.
Net income
574.2
Add depreciation
4050
Less increase in current assets
-1130
Add increase in current assets +450
Operating cash flow
3944.2
c. The cash flow from assets for 2009 is $. Is this possible? .
It is not cash flow from assets but it is cash flow from investing activities for change in value of
fixed assets, which is as follows
+16800-13650+4050 =$7200
The cash used for investing activities
d. If no new debt was issued during the year, the cash flow to creditors is $ and the cash flow to
stockholders is $.
The change in current liabilities belong to creditors and it has increased it measn that creditor
account has been increased by 450 (3150-2700)
To shareholders equity , the dividend paid =$1300
Detail Required: HIGH