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Sladkaya [172]
3 years ago
6

Schwert Corp. shows the following information on its 2019 income statement: sales = $235,000; costs = $147,000; other expenses =

$7,900; depreciation expense = $17,500; interest expense = $13,500; taxes = $17,185; dividends = $10,500. In addition, you’re told that the firm issued $5,000 in new equity during 2019 and redeemed $3,500 in outstanding long-term debt. (Do not round intermediate calculations.) a. What is the 2019 operating cash flow? b. What is the 2019 cash flow to creditors? c. What is the 2019 cash flow to stockholders? d. If net fixed assets increased by $20,000 during the year, what was the addition to net working capital (NWC)?
Business
1 answer:
Usimov [2.4K]3 years ago
8 0

Answer:

a. $62,915

b. $17,000

c. $5,500

d. $2,915

Explanation:

a. The operating cash flow is shown below:

= EBIT + Depreciation - Income tax expense

where,  

EBIT = Sales - cost of good sold - other expenses - depreciation expense  

=  $235,000 - $147,000 - $7,900 - $17,500

= $62,600

And all other items would remain same

Now put these values to the above formula  

So, the value would equal to

= $62,600 + $17,500 - $17,185

= $62,915

b. The computation of the cash flow to creditors is shown below:

= Interest expense - ending balance of long term debt + beginning balance of long term debt  

= $13,500 - (-$3,500)

= $17,000

c. The computation of the cash flow to stockholder is shown below:

= Dividend expense - new equity

= $10,500 - $5,000

= $5,500

d. Computation of the addition to the net working capital is shown below:

The computation of the cash flow from assets = cash flow to creditors + cash flow to stockholders

= $17,000 + $5,500

= $22,500

Now addition to NWC = Operating cash flow - cash flow from assets - net capital spending

= $62,915 - $22,500 - ($20,000 + $17,500)

= $2,915

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Vanyuwa [196]

the weighted average cost of capital for Nipigon is 0.049716

Calculate the weighted average cost of capital for Nipigon

cost of Equity share= 120,000 x $25= $30,00,000

cost of Preference share= 49,000 x $38= $18,62,000

cost of debt= $9,50,000

Total cost = $30,00,000 + $18,62,000 + $9,50,000

                 = $58,12,000

Weightage

Equity= $30,00,000/$58,12,000= 0.516

Preference=  $18,62,000/$58,12,000= 0.320

Debt= $9,50,000/$58,12,000= 0.164

Rates

Equity = 0.11

Preference= 0.10

Debt= 0.09 (1-0.4)= 0.54

weighted average cost

Equity= 0.516 x 0.11 = 0.05676

preference= 0.320 x 0.10= 0.0320

Debt= 0.164 x 0.54= 0.00886

Total weighted average cost= 0.05676+0.0320+0.00886

=0.049716

What is the weighted average cost method?

A weighted average computation accounts for the varying levels of significance of the numbers in a data collection. A specified weight is multiplied by each value in the data set before the final computation is completed when calculating a weighted average.

Learn more about weighted average cost method: brainly.com/question/8543883

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Which of these statements about cycle inventory is​ BEST? A. Cycle inventory exists to avoid customer service problems. B. Cycle
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Answer:

<em>A. Cycle inventory exists to avoid customer service problems.</em>

<em></em>

Explanation:

Cycle inventory is the part of inventory kept by a supplier, that shows the amount of inventory available to satisfy demand. Cycle inventory allows the supplier to keep track of his available inventory so as to remove the problem of not meeting customers demand, which can led to loss of customers. And also to reduce the problem of over-storage that can lead to additional holding charge.

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Suppose a firm estimates its WACC to be 10%. Should the WACC be used to evaluate all of its potential projects, even if they var
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Answer:

The WACC will be 10% for average risk

below when the risk is low

and above 10% when the risk is higher than average

as the cost of capital (required return from the stockholders) will increase pushing the WACC higher

Explanation:

As the WACC is composed by the cost of debt and the cost of equity a higher risk will require a better return for the investor thus, the equity proportion that determinates the WACC will change along the project risk.

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3 years ago
malek jones, a business analyst at the vnh corporation, feels that his employer terminated him for no reason. although the compa
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Constitutions and, more specifically, anti-discrimination statutes represent public policy about equal employment opportunity (EEO).

These laws are in place at the federal, state, and local levels in the United States.

In terms of the employers or other entities they cover, the specific groups of people they defend, the transactions they regulate, and the kind and scope of legal remedies they offer, EEO laws differ widely from one location to another. When businesses engage employees, the philosophical idea of EEO is implied, at the very least.

WHAT IS AN "OPPORTUNITY" FOR WORK?

U.S. EEO rules forbid discrimination in terms and circumstances of employment on the basis of specified characteristics. As a result, "opportunities" can be found in a variety of employment circumstances, such as:

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8 0
1 year ago
Dean's Coffee Shop makes a blend that is a mixture of two types of coffee. Type A coffee costs Deon $4.75 per pound, and type B
sergiy2304 [10]

Answer:

type B 50 pounds

type A 94 pounds

Explanation:

First we construct the equation system:

\left \{ {{A_q + B_q = 144} \atop {4.75A_q + 5.9B_q = 741.5}} \right. \\

Now we clear one and replace:

A_q = 144 - B_q\\4.75A_q + 5.9B_q = 741.5\\4.75(144 - B_q) + 5.9B_q = 741.5

And we can solve for type B:

4.75\times 144 - 4.75B_q + 5.9B_q = 741.5\\1.15B_q = 741.5 - 684\\B_q = 57.5 / 1.15 = 50

And now we can solve for quantity of A as well:

A = 144 - 50 = 94

<u>Finally we can check the answer if it is correct:</u>

50 x 5.9 + 94 X 4.75 =

   295       +      446,5‬   = 741,5‬

5 0
3 years ago
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