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Financial statements The Davidson Corporation's balance sheet and income statement are given here: Davidson Corporation: Balance Sheet as of December 31, 2005 (Millions of Dollars) Assets Liabilities and Equity Cash and equivalents $ 15 $ 120 Accounts receivable Inventories Accounts payable Notes payable Accruals 515 220 280 $ 620 1,520 $2,140 880 $1,410 2,590 Total current assets Total current liabilities Long-term bonds Total debt Net plant and equipment Common stock (100 million shares) Retained earnings Common equity Total liabilities and equity 260 1,600 $1,860 $4,000 Total assets $4,000

Financial statements The Davidson Corporation's balance sheet and income statement are given here: Davidson Corporation: Balance Sheet as of December 31, 2005 (Millions of Dollars) Assets Liabilities and Equity Cash and equivalents $ 15 $ 120 Accounts receivable Inventories Accounts payable Notes payable Accruals 515 220 280 $ 620 1,520 $2,140 880 $1,410 2,590 Total current assets Total current liabilities Long-term bonds Total debt Net plant and equipment Common stock (100 million shares) Retained earnings Common equity Total liabilities and equity 260 1,600 $1,860 $4,000 Total assets $4,000

Fundamentals of Financial Management, Concise Edition (MindTap Course List)
Fundamentals of Financial Management, Concise Edition (MindTap Course List)
9th Edition
ISBN:9781305635937
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Eugene F. Brigham, Joel F. Houston
Chapter3: Financial Statements, Cash Flow, And Taxes
Section: Chapter Questions
Problem 16P: FINANCIAL STATEMENTS The Davidson Corporation's balance sheet and income statement are provided...
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3-12 Financial statements The Davidson Corporation's balance sheet and income statement are given here: Davidson Corporation: Balance Sheet as of December 31, 2005 (Millions of Dollars) Assets Liabilities and Equity $ 15 Cash and equivalents Accounts receivable Accounts payable Notes payable Accruals $ 120 515 220 Inventories 880 280 $ 620 1,520 $2,140 Total current assets $1,410 Total current liabilities Net plant and equipment 2,590 Long-term bonds Total debt Common stock (100 million shares) 260 Retained earnings Common equity Total liabilities and equity 1,600 $1,860 $4,000 Total assets $4,000
Transcribed Image Text:3-12 Financial statements The Davidson Corporation's balance sheet and income statement are given here: Davidson Corporation: Balance Sheet as of December 31, 2005 (Millions of Dollars) Assets Liabilities and Equity $ 15 Cash and equivalents Accounts receivable Accounts payable Notes payable Accruals $ 120 515 220 Inventories 880 280 $ 620 1,520 $2,140 Total current assets $1,410 Total current liabilities Net plant and equipment 2,590 Long-term bonds Total debt Common stock (100 million shares) 260 Retained earnings Common equity Total liabilities and equity 1,600 $1,860 $4,000 Total assets $4,000
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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