Trading, Profit & Loss Account and Balance Sheet

Step 1: Being able to calculate the present value of the companies' stocks, we should first calculate the present value of the companies'

Operating cash flow was not enough to cover capital investments (this firm does not to appear to pay dividends as it does not show in the prior 3 years). The firm is financing it operations from the issuance of common stock. $23,082 was raised during the period, which is covering its investments in capital expenditures.

cognizant of the fact that the choices he makes can affect the price a buyer pays

The purpose of accounting cycle report is to keep the best accounting records up to date. It also assist in producing the best possible financial statement that shows the true pictures of the business or organization and help making a good call whether business is profitable or not.

A line of credit is an informal agreement that permits a company to borrow up to a prearranged limit

Company issues 15,000 shares of stock @ $200 per share to raise $3,000,000 in capital with 5% return (cost of equity)

1. A NSF check should appear in which section of the bank reconciliation? (Points : 2)

Kudler Fine Foods, though fictitious, is doing very well for itself—even when compared to a large supermarket chain like Walmart. When dividing the Net Income of Kudler Fine Foods, $676,795.00, by the company’s Net Sales $10,796,200.00, we get a before-tax profit margin of 6.268%. This means that Kudler Fine Foods has almost double the pre-tax profit margin than Walmart’s post-tax profit margin of 3.515% (Ycharts, 2012). This means that unless the yearly taxes due for Kudler Fine Foods is about 50%, they will likely have higher profit margins than Walmart. That is pretty good for a fictitious company…

They proceeded for this proposal and keeping in mind that they need not to pay any interest, dividends or the $80 per share until we start generating sales. At the same time, the investors will also get their money back plus $120 per share profit. The attorney approved the new stock offering and $312,500 shares of common stock were privately sold

We added the market risk premium of 6% to the 4.60% because 6% is the rate that investors want above the risk free rate due to the risk of the investment. This equals 10.6% which is then multiplied by the beta of the company of 1.1. Beta is a measure of the stock’s volatility in relation to the market. A beta of 1.1 means that Worldwide Paper Company has slightly higher volatility than the market does. The total cost of equity then calculates to equal 11.2%. This tells us that given the risk taken in investing in the company, a shareholder should expect an 11.2% return.

This paper provides the horizontal and vertical analysis of the income statement and the balance sheet. Equally, financial ratios have been computed to show the leverage, liquidity, efficiency, profitability and the equity of the Hewlett Packard enterprises. Recommendations and conclusion have been made on the results depicted by the analysis. Lastly, an evaluation was made on the different ways that stakeholders utilize the financial statements.

1994 Liabilities and Equity Short-term borrowings Accounts payable Progress collections and price adjustments accrued Dividends payable Taxes accrued Other costs and expenses accrued Current liabilities Long-term borrowings Other liabilities Total liabilities Minority interest in equity of consolidated affiliates Preferred stock Common stock Amounts received for stock in excess of par value Retained earnings Deduct common stock held in treasury Total shareowners’ equity Total liabilities and equity $644.9 696.0 1,000.5 72.8 337.2 1,128.1 $3,879.5 1,195.2 518.9 5,593.6 $ 71.2 $ — $465.2 414.5 3,000.5 $3,880.2 (175.9 ) $3,704.3 $9,369.1 $665.2 673.5 718.4 72.7 310.0 1,052.6 $3,492.4 917.2 492.1 4,901.7 50.1 — $463.8 409.5 2,683.6 $3,556.9 (184.5 ) $3,372.4 $8,324.2 $ $120.6 376.2 300.5 58.7 318.3 392.6 $1,566.9 364.1 221.0 2,152.0 41.4 — $455.8 266.9 1,384.5 $2,107.2 — $2,107.0 $4,300.6 1993 1985

Balance sheets and income statements are a snapshot of a company’s stability and financial situation. Combined the statements show the income, expenses, and stockholder’s equity in the company. These statements are often analyzed by financial institutions when a company comes to them needing a loan. Stockholders and other investors also look at these statements to make sure their investment will return a profit for them. This paper will look at four different companies and their balance sheets and income statements. The companies are Eastman Chemical Company, Covenant Transportation

The balance sheet and Income statement are the most important financial statements of the company that help conduct current analysis of company and evaluate its trends overtime. The balance sheet represents the company snapshots of its financial position on the last days of accounting period. Apple balance sheets, which represent a snapshot of its ending balances in asset, liability and equity account as of the date stated on the report, are changes each year from 2003 to 2014. On the other hand, the income statement shows its financial performance over 2003 to 2014. Apple basically ends its accounting period in September. Most of the long-term debts are in the form of the bonds. According to appleinsider.com, Apple recently issues a new euro bond worth about $2.26 billion with a maturity date on January 17, 2024 and coupon rate of 1.375% payable annually. The first payment will occur on January 17, 2016. Moody’s recently assigned a rating of Aa to Apple Inc. 's senior unsecured note issuance. Thus, Apple recent capital expenditure amount to 11,488 million according to morningstar.com. The analysis of financial statements is conduct to compare Apple with one of its closest rival Hewlett-Packard and twelve ratio were calculated. From table1 and chart1, the current ratio that determine the company ability to meet its short term obligation shows Apple’s current ratio is higher than that of Hewlett-Package from 2003 to 2014. That is, Apple is solvent than Hewlett Packard. Table

2. At the end of its first year of operations, Matlocke Company has total assets of $2,000,000 and total liabilities of $1,200,000. The owner originally invested $200,000 in the business, but has not made any further investments or taken any withdrawals. What is the first year 's net income for Matlocke Company?