12.Information related to the Berkley Company for the calendar year 2015 follows:Liabilities, December 31, 2015Assets, December 31, 2015Dividends distributed during 2015Liabilities, December 31, 2014Assets, December 31, 2014$44070090300450Assuming no capital stock was issued during 2015, the net income earned by the Berkley Companyduring 2015 was0110

Name: 12.Information related to the Berkley Company for the calendar year 2
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Description: 12.Information related to the Berkley Company for the calendar year 2015 follows:Liabilities, December 31, 2015Assets, December 31, 2015Dividends distributed during 2015Liabilities, December 31, 2014Assets, December 31, 2014$44070090300450Assuming n

The accounting equation states that assets equals to sum of liabilities and shareholders equity.

Business

Accounting

2. Information related to the Berkley Company for the calendar year 2015 follows: iabilities, December 31, 2015 ssets, December 31, 2015 ividends distributed during 2015 iabilities, December 31, 2014 ssets, December 31, 2014 $440 700 90 300 450 suming no capital stock was issued during 2015, the net income earned by the Berkley Company uring 2015 weg

2. Information related to the Berkley Company for the calendar year 2015 follows: iabilities, December 31, 2015 ssets, December 31, 2015 ividends distributed during 2015 iabilities, December 31, 2014 ssets, December 31, 2014 $440 700 90 300 450 suming no capital stock was issued during 2015, the net income earned by the Berkley Company uring 2015 weg

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter17: Financial Statement Analysis

Section: Chapter Questions

Problem 17E

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CALCULATING THE WACC Here is the condensed 2016 balance sheet for Skye Computer Company (in thousands of dollars): 2016 Current assets 2,000 Net fixed assets 3,000 Total assets 5,000 Accounts payable and accruals 900 Short-term debt 100 Long-term debt 1,100 Preferred stock (10,000 shares) 250 Common stock (50,000 shares) 1.300 Retained earnings 1,350 Total common equity 52,650 Total liabilities and equity 5,000 Skyes earnings per share last year were 3.20. The common stock sells for 55.00, Last year's dividend (Do) was 2.10, and a flotation cost of 10% would be required to sell new common stock. Security analysts are projecting that the common dividend will grow at an annual rate of 9%. Skye's preferred stock pays a dividend of 3.30 per share, and its preferred stock sells for 30.00 per share. The firm's before-tax cost of debt is 10%, and its marginal tax rate is 35%. The firms currently outstanding 10% annual coupon rate, long-term debt sells at par value. The market risk premium is 5%, the risk-free rate is 6%, and Skyes beta is 1.516. The firms total debt, which is the sum of the companys short-term debt and Long-term debt, equals 1.2 million. a. Calculate the cost of each capital component, that is, the after-tax cost of debt, the cost of preferred stock, the cost of equity from retained earnings, and the cost of newly issued common stock. Use the DCF method to find the cost of common equity. b. Now calculate the cost of common equity from retained earnings, using the CAPM method. c. What is the cost of new common stock based on the CAPM? (Hint: Find the difference between rc and rs. as determined by the DCF method, and add that differential to the CAPM value for rs) d. If Skye continues to use the same market-value capital structure, what is the firms WACC assuming that (1) it uses only retained earnings for equity? (2) If it expands so rapidly that it must issue new common stock?
Earnings per share Financial statement data for the years ended December 31 for Black Bull Inc. follows: 2016 2015 Net income 2,485,700 1,538,000 Preferred dividends 50,000 50,000 Average number of common shares outstanding 115,000 shares 80,000 shares a. Determine the earnings per share for 2016 and 2015. b. Does the change in the earnings per share from 2015 to 2016 indicate a favorable or an unfavorable trend?
Frost Company has accumulated the following information relevant to its 2019 earningsper share. 1. Net income for 2019: 150,500. 2. Bonds payable: On January 1, 2019, the company had issued 10%, 200,000 bonds at 110. The premium is being amortized in the amount of 1,000 per year. Each 1,000 bond is currently convertible into 22 shares of common stock. To date, no bonds have been converted. 3. Bonds payable: On December 31, 2017, the company had issued 540,000 of 5.8% bonds at par. Each 1,000 bond is currently convertible into 11.6 shares of common stock. To date, no bonds have been converted. 4. Preferred stock: On July 3, 2018, the company had issued 3,800 shares of 7.5%, 100 par, preferred stock at 108 per share. Each share of preferred stock is currently convertible into 2.45 shares of common stock. To date, no preferred stock has been converted and no additional shares of preferred stock have been issued. The current dividends have been paid. 5. Common stock: At the beginning of 2019, 25,000 shares were outstanding. On August 3, 7,000 additional shares were issued. During September, a 20% stock dividend was declared and issued. On November 30, 2,000 shares were reacquired as treasury stock. 6. Compensatory share options: Options to acquire common stock at a price of 33 per share were outstanding during all of 2019. Currently, 4,000 shares may be acquired. To date, no options have been exercised. The unrecognized compens Frost Company has accumulated the following information relevant to its 2019 earnings ns is 5 per share. 7. Miscellaneous: Stock market prices on common stock averaged 41 per share during 2019, and the 2019 ending stock market price was 40 per share. The corporate income tax rate is 30%. Required: 1. Compute the basic earnings per share. Show supporting calculations. 2. Compute the diluted earnings per share. Show supporting calculations. 3. Indicate which earnings per share figure(s) Frost would report on its 2019 income statement.
Prince Corporations accounts provided the following information at December 31, 2019: What should be the current balance of retained earnings? a. 520,000 b. 580,000 c. 610,000 d. 670,000
The following amounts were taken from the financial statements of Concord Corporation: 2017 2016 Total assets $818000 $1020000 Net sales 726000 655000 Gross profit 376000 332000 Net income 118000 130000 Weighted average number of 90200 80000 common shares outstanding Market price of common stock $42 $36 The return on assets for 2017 is 12%. 13%. 14%. 6%.
Using the information below calculate the ROC of the company Years Revenue ($M) Net Income ($M) 2012 221.8 2.9 2013 473.8 20.2 2014 627.7 36.4 2015 947.8 45.0 2016 1,015.5 50.3 2017 1,046.2 64.9 2018 1,293.2 90.4 Years Total Assets ($M) Fixed Assets ($M) Current Assets ($M) Total Equity ($M) Retained Earnings ($M) 2012 430 286 144 293 12.8 2013 956 501 455 558 33.0 2014 922 668 324 620 69.4 2015 1103 796 307 665 114.4 2016 1120 835 285 729 164.7 2017 1294 738 556 805 229.6 2018 2053 703 1350 934 320
#12 The summarized balance sheets of ROSE N' Company and GARDEN Company as of December 31, 2021, are as follows: ROSE N' CompanyBalance SheetDecember 31, 2021 Assets $2000000 Liabilities $220000 Capital stock 1000000 Retained earnings 780000 Total equities $2000000 GARDEN CompanyBalance SheetDecember 31, 2021 Assets $1480000 Liabilities $330000 Capital stock 990000 Retained earnings 160000 Total equities $1480000 If ROSE N' Company acquired a 30% interest in GARDEN Company on December 31, 2021 for $350000 and the equity method of accounting for the investment were used, the amount of the debit to Equity Investments (GARDEN) would have been $444000. $297000. $345000. $350000.
The summarized Statement of Financial Position of P Bhd. and S Bhd. as at 31December 2016 is shown below: P Bhd.RM ‘000 S Bhd.RM ‘000 Non – current assetsProperty, plant &equipment 720 160 Investment in SBhd. 185 Current assets 175 951,080 255Share capital 400 100Retained earnings b/f 500 60Retained earnings –current year 60 12Current liabilities 120 831,080 255 Additional information:(i) P Bhd. acquired 60% of S Bhd. on the date of acquisition (1/7/2016) (ii) P Bhd. adopts the proportional net assets value method in valuation of non-controlling interest. (iii) At date of acquisition, fair value of NCI was RM 50,000Prepare the Consolidated Statement of Financial Position as at 31/12/2016.
JUST DEW IT CORPORATION2017 and 2018 Balance Sheets Assets Liabilities and Owners' Equity 2017 2018 2017 2018 Current assets Current liabilities Cash $ 10,150 $ 10,350 Accounts payable $ 74,500 $ 61,250 Accounts receivable 27,100 27,250 Notes payable 48,500 49,250 Inventory 62,900 63,500 Total $ 123,000 $ 110,500 Total $ 100,150 $ 101,100 Long-term debt $ 59,400 $ 64,900 Owners' equity Common stock and paid-in surplus $ 80,000 $ 80,000 Fixed assets Retained earnings 171,750 192,700 Net plant and equipment $ 334,000 $ 347,000 Total $ 251,750 $ 272,700 Total assets $ 434,150 $ 448,100 Total liabilities and owners' equity $ 434,150 $ 448,100 Based on the balance sheets given for Just Dew It, calculate the following…
Paulson Company had the following on the dates indicated:12/31/18 12/31/17Total assetsTotal liabilities$ 530,00036,000$ 350,00023,000Paulson had no stock transactions in 2018, so the change in stockholders’ equity for 2018 wasdue to net income and dividends. If dividends were $75,000, how much was Paulson’s netincome for 2018? Use the accounting equation and the statement of retained earnings.a. $92,000b. $242,000c. $167,000d. $317,000
The following information relates to Moran Co. for the year ended December 31, 2017: net income $1,245.7 million; unrealized holding loss of $10.9 million related to available-for-sale debt securities during the year; accumulated other comprehensive income of $57.2 million on December 31, 2016. Assuming no other changes in accumulated other comprehensive income, determine (a) other comprehensive income for 2017, (b) comprehensive income for 2017, and (c) accumulated other comprehensive income at December 31, 2017.
The asset side of the 2017 balance sheet for the Corporation is below. The company reported total revenues of $37,728 million in 2017 and $37,047 million in 2016. in millions May 31, 2017 May 31, 2016 Current assets: Cash and cash equivalents $ 21,784 $ 20,152 Marketable securities 44,294 35,973 Trade receivables, net of allowances for doubtful accounts of $319 and $327 as of May 31, 2017 and May 31, 2016, respectively 5,300 5,385 Inventories 300 212 Prepaid expenses and other current assets 2,837 2,591 Total current assets 74,515 64,313 Non-current assets: Property, plant and equipment, net 5,315 4,000 Intangible assets, net 7,679 4,943 Goodwill, net 43,045 34,590 Deferred tax assets 1,143 1,291 Other assets 3,294 3,043 Total non-current assets 60,476 47,867 Total assets $134,991 $112,180 How do I figure what the company’s gross amount…