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Financial statements 1"he Davidson Corporation's balance sheet and income statement are elven here   Davidson Corporation: Balance Sheet as of December 31, (Millions of Dollars)   Liabilities and Equity 15 Accounts payable 515 Notes payable 880 51.410 Total current liabilities 2,590 Long-term bonds Total debt Common stock (100 million shares' 260 Retained earnings Common equity 54,000 Total liabilities and equity           Assets   Cash and equivalents Accounts receivable Inventories Total current assets Net plant and equipment

Financial statements 1"he Davidson Corporation's balance sheet and income statement are elven here   Davidson Corporation: Balance Sheet as of December 31, (Millions of Dollars)   Liabilities and Equity 15 Accounts payable 515 Notes payable 880 51.410 Total current liabilities 2,590 Long-term bonds Total debt Common stock (100 million shares' 260 Retained earnings Common equity 54,000 Total liabilities and equity           Assets   Cash and equivalents Accounts receivable Inventories Total current assets Net plant and equipment

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter3: Evaluation Of Financial Performance
Section: Chapter Questions
Problem 18P
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Financial statements 1"he Davidson Corporation's balance sheet and income statement

are elven here

 

Davidson Corporation: Balance Sheet as of December 31, (Millions of Dollars)

 

Liabilities and Equity

15 Accounts payable

515 Notes payable 880

51.410 Total current liabilities 2,590 Long-term bonds

Total debt Common stock

(100 million shares' 260 Retained earnings

Common equity 54,000 Total liabilities and equity

       
 

Assets

 

Cash and equivalents Accounts receivable Inventories

Total current assets Net plant and equipment

 

 

 

 

 

 

Total assets
 
   

1.600 51.860 54.000
 
 
Davidson Corporation: Income Statement for Year Ending December 31, 2005 (Millions of Dollars) Sales $6,250 Operating costs excluding depreciation and amortization 5,230 ЕBITDA $1,020 Depreciation and amortization 220 EBIT $ 800 Interest 180 EBT $ 620 Taxes (40%) 248 $ 372 $ 146 $ 3.72 Net income Common dividends paid Earnings per share All revenues were received in cash during the year and all costs except depreciation and amortization were paid in cash during the year. What was net cash flow? How was it different from reported accounting profit? b. Construct the statement of retained earnings for December 31, 2005. c. How much money has been reinvested in the firm over the years? d. At the present time, how large a check could be written without it bouncing? e. How much money must be paid to current creditors within the next year? а.
Transcribed Image Text:Davidson Corporation: Income Statement for Year Ending December 31, 2005 (Millions of Dollars) Sales $6,250 Operating costs excluding depreciation and amortization 5,230 ЕBITDA $1,020 Depreciation and amortization 220 EBIT $ 800 Interest 180 EBT $ 620 Taxes (40%) 248 $ 372 $ 146 $ 3.72 Net income Common dividends paid Earnings per share All revenues were received in cash during the year and all costs except depreciation and amortization were paid in cash during the year. What was net cash flow? How was it different from reported accounting profit? b. Construct the statement of retained earnings for December 31, 2005. c. How much money has been reinvested in the firm over the years? d. At the present time, how large a check could be written without it bouncing? e. How much money must be paid to current creditors within the next year? а.
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