Answer:
Time Warner, Inc.
a.
Turner Home Box Office Warner Bros. Total
Segment Revenues
(in millions) $21,700 $22,200 $80,600 $124,500
Variable costs 4,774 10,434 25,792 41,000
Contribution margin $16,926 $11,766 $54,808 $83,500
Contribution ratio 78% (100 - 22) 53% (100 -47) 68% (100 -32) 67%
b. Certainly, Turnover and Warner Bros. are more profitable businesses than Home Box Office in terms of total contribution margin (dollars) and contribution margin ratio.
Explanation:
a) Data and Calculations:
Segment Revenues
(in millions)
Turner (cable networks and digital media) $21,700
Home Box Office (pay television) 22,200
Warner Bros. (films, television, and videos) 80,600
Assume that the variable costs as a percent of sales for each segment are as follows:
Turner 22%
Home Box Office 47%
Warner Bros. 32%
b) The contribution margin ratio for the three segments can easily be determined by subtracting the variable costs percentages from 100 for each segment instead of doing more computations (Contribution margin/Sales Revenue * 100). But the results are the same for either method.
If you need to indicate the missing ammount of each letter in the grahp then it will be like follows:
For the first case:
A = $9,600 + $5,000 + $8,000 = $22,600$22,600 + $1,000 – B = $17,000
B = $22,600 + $1,000 – $17,000 = $6,600$17,000 + C = $20,000
C = $20,000 – $17,000 = $3,000
D = $20,000 – $3,400 = $16,600
<span>E = ($24,500 – $2,500) – $16,600 = $5,400
</span><span>F = $5,400 – $2,500 = $2,900
</span>And now for the second case:
G + $8,000 + $4,000 = $16,000
G = $16,000 – $8,000 – $4,000 = $4,000$16,000 + H – $3,000 = $22,000
H = $22,000 + $3,000 – $16,000 = $9,000(I – $1,400) – K = $7,000(I – $1,400) – $22,800 = $7,000
<span>I = $1,400 + $22,800 + $7,000 = $31,200
</span>J = $22,000 + $3,300 = $25,300
K = $25,300 – $2,500 = $22,800$7,000 – L = $5,000
<span>L = $2,000</span>
Answer:
I don't know
Explanation:
Prepare a narrated PowerPoint presentation that will highlight the following items.
a. Your calculations for the amount of property, plant, and equipment and the annual depreciation for the project
b. Your calculations that convert the project's EBIT to free cash flow for the 12 years of the project.
c. The following capital budgeting results for the project:
1. Net present value
2. Internal rate of return
3. Discounted payback period.
Answer
Retained earnings at the beginning of Year 2 was: $1,450
Explanation
Revenue = $2,100
Retained Earnings Closing Balance = $1,850
Expenses = $1,150
Dividends = $550
Retained Earnings Closing Balance = Revenue - Expenses - Dividends + Retained Earning Beginning Balance
$1,850 = $2,100 - $1,150 - $550 + Retained Earning Beginning Balance
Retained Earning Beginning Balance = $1,450