Airbus

Through the calculations it shows that ABC Company made cash flow from their operations totally about $27,000 in year 19X2, the income after tax that was reported was $12,000. The cash flow statement further points out that ABC Company utilized more cash within investing activities and financing activities as opposed to the cash inflows provided through those resources. The net cash flows were in the black for the ABC Company, which was $14,000. Net income appears to be the key basis of their cash flow; the company utilized the cash flow from operating activities for investments in equipment and payment of dividends. (Shown in appendix 1)

Mark and Todd should consider the monthly payment and the ability of the company to repay the loan. If S & S Air can afford to pay a higher payment, they can pay down the principal faster. Assuming the bank will not charge a fee for an early payoff; S & S could save money and avoid the risk associated with the balloon payment option or interest-only loan. By taking the 20 year loan option and making additional principal payments to decrease the interest owed, S & S could pay off a 20 year loan in 158 months. The following table illustrates the option presented above:

The company has an agreement with a bank that allows the company to borrow the exact amount needed at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company will pay the bank all of the accrued interest on the loan and as much of the loan as possible while still retaining at least $50,000 in cash.

In this case, the Profit Before Tax (PBT) would have been higher by $200,000. Therefore, they would have paid 28% x $200,000 = $56,000 in taxes. The Net Income (NI) would have been increased by $144,000.

income is $26.03 for year 1. Similarly, the present value of the firm at time 1 is

a. How much would the payment be if rate of interest is 5% and you only financed the truck for 48 months?

Operating Taxes & Licenses | 18,613 | 17,989 | 2% | 2% | Insurance & Claims | 13,526 | 13,006 | 2% | 2% | Provision for Depreciation | 2,726 | 2,738 | .3% | .3% | Total Operating Expenses | 848,242 | 775,535 | 97% | 97% | | Operating Income

Amy pays $16,585.60 more in her total amount repaid by extending her term from 10 years to 25 years (see the example below), but her monthly

The revenue is $600,600*1.2= $720,720. The variable cost changes as sales increases and fixed cost stays the same, the gross profit is $175,500. After tax, the net income is $100,557.

Scenario 2 shows the practice having moderate growth and there is no decrease in the associate fee. Even though the growth rate is 8% and not 17.5%, the company can still repay the loan because the CATO is positive throughout the years. Miller might not be able to repay the loan that fast, like scenario 1, but would be able to repay it in 10 years.

3) Based on the data in Exhibit 7 and the definition of operating income gains given

net sales: $1,000,000 cost of goods sold: $700,000 rent: $20,000 wages: $100,000 other operating expenses: $50,000 net sales – all operating expenses = 530,000

Alex’s Fine Art Studio is a company offering art services. The owner Alex Touch has been contacted by the manager of Ruthven Cars Company who complained about the price charged for some art work. On the same day Alex was also contacted by the manager of Books Galore who was delighted with the work and the price charged.

1. Calculating Taxes. The Herrera Co. had $246,000 in taxable income. Using the rates from Table 2.3 in the chapter calculate the company's income taxes. What is the average tax rate? What is the marginal tax rate?

The income statement presents the company was profitable if Carmen ignore income taxes, because the company has a net income $1,480 before taxes.