Consider the following information. Assets Equity and liabilities P500,000 Current debt P900,000 Other current Cash P200,000 Non-cash current P1,000,000 assets liabilities Minority equity P100,000 Non-current debt P300,000 investment Non-current assets P500,000 Deferred tax liability P100,000 P400,000 Equity P2,000,000 Total Total P2,000,000 The company requires a cash balance of P300,000 for its operations.

Consider the following information. Assets Equity and liabilities P500,000 Current debt P900,000 Other current Cash P200,000 Non-cash current P1,000,000 assets liabilities Minority equity P100,000 Non-current debt P300,000 investment Non-current assets P500,000 Deferred tax liability P100,000 P400,000 Equity P2,000,000 Total Total P2,000,000 The company requires a cash balance of P300,000 for its operations.

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter14: Long-term Liabilities: Bonds And Notes

Section: Chapter Questions

Problem 1PEA

See similar textbooks

Similar questions

How do you get the answer on below? Corning-Howell reported taxable income in 2021 of $156 million. At December 31, 2021, the reported amount of some assets and liabilities in the financial statements differed from their tax bases as indicated below: Carrying Amount Tax Basis Assets Current Net accounts receivable $ 44 million $ 48 million Prepaid insurance 56 million 0 Prepaid advertising 40 million 0 Noncurrent Investments in equity securities (fair value)* 40 million 0 Buildings and equipment (net) 396 million 316 million Liabilities Current Deferred subscription revenue 48 million 0 Long-term Liability—compensated future absences 630 million 0 *Gains and losses taxable when investments are sold. The total deferred tax asset and deferred tax liability amounts at January 1, 2021, were $174.25 million and…
Using the financial statements mentioned above estimate the annual rate of interest paid by the corporation (cost of debt). Also, find the tax rate and capitalization ratio (proportions among equity and debt). Using these values that you have found estimate the annual weighted cost of capital (WACC) of the corporation. Income statement PERIOD ENDING: 12/31/2019 Total Revenue $20,972,000 Cost of Revenue $17,755,000 Gross Profit $3,217,000 OPERATING EXPENSES Research and Development $0 Sales, General and Admin. $938,000 Non-Recurring Items $138,000 Other Operating Items $341,000 Operating Income $1,800,000 Add'l income/expense items $180,000 Earnings Before Interest and Tax $1,993,000 Interest Expense $394,000 Earnings Before Tax $1,599,000 Income Tax $326,000 Minority Interest $13,000 Equity Earnings/Loss Unconsolidated Subsidiary $0 Net Income-Cont. Operations $1,286,000 Net Income $1,273,000 Net Income Applicable to Common Shareholders…
The following information was taken from the accounting records of Lancer Inc, for the year ending 2020. Pretax accounting income $ 1,500,000 Interest Revenue on Municipal bonds 100,000 Litigation expense 2, 000,000 Excess Depreciation for tax purposes 1, 300,000 Deferred revenue 200,000 The tax rate for 2020 is 40% The total Deferred Tax Asset for 2020 should be : A) $4,000 B) $800,000 C) $520,000 D) $80,000
Refer to the following financial information of Scholz Company: NOPAT 8,250,000.00 EBITDA 17,725,000.00 Net Income 5,050,000.00 Capital Expenditures 6,820,000.00 After tax capital costs 6,280,000.00 Tax rate 40% Calculate the Company’s depreciation and amortization expense Refer to the following financial information of Scholz Company: NOPAT 8,250,000.00 EBITDA 17,725,000.00 Net Income 5,050,000.00 Capital Expenditures 6,820,000.00 After tax capital costs 6,280,000.00 Tax rate 40% 13. Calculate the Company’s depreciation and amortization expense 14. Refer to Scholz Company, calculate its interest expense. Use 2 decimal places for your final answer. 15. Refer to Scholz Company, calculate its…
identify deferred tax assets/liabilioties in the following figure Total Current Assets - - - - Total Assets 1057734 1014060 979868 976502 Cash & Due from Banks 96610 81786 73246 65619 Other Earning Assets, Total 144765 123145 118007 118805 Net Loans 759118 742473 737033 727002 Property/Plant/Equipment, Total - Net 5468 5602 5205 2383 Property/Plant/Equipment, Total - Gross - - - - Accumulated Depreciation, Total - - - - Goodwill, Net 5269 5284 5997 5974 Intangibles, Net 1674 1660 1732 1991 Long Term Investments 2865 3034 3054 3001 Other Long Term Assets, Total 4139 3830 3098 18226 Other Assets, Total 37826 47246 32496 33501 Total Current Liabilities - - - - Total Liabilities 982736 942052 908766 906908 Accounts Payable 9826 13188 9998 10285 Payable/Accrued - - - - Accrued Expenses - - - - Total Deposits 750843 701551 666300 640311 Other Bearing Liabilities, Total - - - 32 Total Short Term Borrowings 26633 16877 20346 19099…
Given the following information: Total assets = $2,000,000 Debt = 40%, Equity = 60% Cost of equity = 9% Cost of debt (before tax) = 5% EBIT = $200,000 Tax rate = 20% Residual income is closest to: Question 4Answer a. $108,000 b. $4,000 c. $40,000
Please calculate capital allowance using declining balance method with the following information: Details of the Fixed Assets: Details Cost NBV Tax Written Down As at 31 Dec 2021 As at 31 Dec 2021 Value as at 1 Jan 2021Motor Vehicles 10,00,000 7,200,000 7,000,000Equipment 15,000,00 12,00,000 6,713,335Office buildings 45,000,000 36,000,000 36,450,000 Included in the cost of motor vehicle is a lorry purchased on 1 April 2021 for $2,000,000…
Le Bron Corporation has the following information for 2021 taxable year: Quarter RCIT MCIT CWT First P200,000 P160,000 P40,000 Second 240,000 500,000 60,000 Third 500,000 150,000 80,000 Fourth 300,000 200,000 70,000 Additional information: Excess MCIT from 2020: P60,000 Excess tax credits from 2020: P20,000 1.) How much was the income tax payable for the first quarter? a. 200,000 b. 160,000 c. 120,000 d. 80,000 2.) How much was the income tax payable for the second quarter? a. 660,000 b. 460,000 c. 200,000 d. 160,000 3.) How much was the annual income tax payable? a. 1,260,000 b. 390,000 c. 230,000 d. 930,000
The following information was taken from the accounting records of Lancer Inc, for the year ending 2020. Pretax accounting income $ 1,500,000 Interest Revenue on Municipal bonds 100,000 Litigation expense 2, 000,000 Excess Depreciation for tax purposes 1, 300,000 Deferred revenue 200,000 The tax rate for 2020 is 40% The total taxable income computed by Lancer for 2020 should be : A) $2,300,000 B) $4.900,000 C) $ 900,000 D) $3,700,000
BACKGROUND The company, North S.L., has the following information in the Balance Sheet and Profit and Loss Account for 2016, before calculating its Corporate Tax: BALANCE SHEET ASSETS LIABILITIES 69.360,00 A) NON CURRENT ASSET A) NET EQUITY 105.130,00 4.860,00 1. Intangible asset A-1) Equity 60.000,00 4.860,00 1. R+D 1. Capital 60.000,00 4.860,00 201 DEVELOPMENT 1. Issued capital 60.000,00 64.500,00 II. Tangible Fixed Assets 100 SOCIAL CAPITAL 19.500,00 64.500,00 2. Technical facilities and others. III. Funds 12.000,00 52.000,00 213 MACHINERY 1. Legal y statuary 12.000,00 8.000,00 216 FURNITURE 112 LEGAL FUNDS 7.500,00 3.500,00 217 INFORMATION PROCESSING EQUIP. 2. Other funds 7.500,00 25.000,00 218 TRANSPORT 113 VOLUNTEER FUND 25.630,00 -24.000,00 281 CUMULATIVE DEPRECIATION VII. Result of the fiscal year 32.000,00 104.050,00…
BACKGROUND The company, North S.L., has the following information in the Balance Sheet and Profit and Loss Account for 2016, before calculating its Corporate Tax: BALANCE SHEET ASSETS LIABILITIES 69.360,00 A) NON CURRENT ASSET A) NET EQUITY 105.130,00 4.860,00 1. Intangible asset A-1) Equity 60.000,00 4.860,00 1. R+D 1. Capital 60.000,00 4.860,00 201 DEVELOPMENT 1. Issued capital 60.000,00 64.500,00 II. Tangible Fixed Assets 100 SOCIAL CAPITAL 19.500,00 64.500,00 2. Technical facilities and others. III. Funds 12.000,00 52.000,00 213 MACHINERY 1. Legal y statuary 12.000,00 8.000,00 216 FURNITURE 112 LEGAL FUNDS 7.500,00 3.500,00 217 INFORMATION PROCESSING EQUIP. 2. Other funds 7.500,00 25.000,00 218 TRANSPORT 113 VOLUNTEER FUND 25.630,00 -24.000,00 281 CUMULATIVE DEPRECIATION VII. Result of the fiscal year 32.000,00 104.050,00…
From the following data, indicate the effect that the changes in the relevant items will have on the working capital:ParticularsJan 1, 2020Dec 31, 2020ParticularsJan 1, 2020Dec 31, 2020 Land4400068000Goodwill1300013000 Debentures2000025000Prepaid Expenses70300 Stock3000028000Bills Payable1500900 Machinery180000180000Bills Receivable30002000 Trade Creditors80005320Mortgaged Loan5000040000 Cash290009000Equity Share Capital100000120000 Long Term Investments100006250Preference Share Capital12000075000 Accrued Expenses350160Trade Debtors1900020000 Short-term Debt32205170 Your answer must indicate the overall and individual effect of changes in relevant items.