Answer:
The after-tax cash flow generated by Eraser Corp in 2017 should be $89.5 million
Explanation:
Net income before tax = Revenue - Cost of Goods Sold - Sales General and Admin Expenses = $200 million - $100 million - $50 million = $50 million
Eraser Corp faced a tax rate of 21%,
Tax paid = 21% x $50 million = $10.5 million
No money was spent on Capital Expenditures or on additional Net Working Capital.
The after-tax cash flow generated by Eraser Corp in 2017 = Net income before tax + Depreciation expense - Tax = $50 million + $50 million - $10.5 million = $89.5 million
Note: Depreciation expense is Non-Cash Expenses, so it does not include in Cash Flow.
Explanation:
The commercial company chosen is Amazon.com Inc, this is a multinational that operates in the areas of artificial intelligence, electronic commerce and computing. Amazon was founded in 1994 by Jeff Bezos, with the main objective of being a company that sells books on the internet, at that time the idea did not seem so promising, because the internet was little used worldwide, but Bezos saw there a opportunity and called itself the first virtual book store in the world, and began to be noted for the strategy of offering aggressive discounts, which made the company gain name and popularity.
The success strategy used by Bezos was to offer the customer an easy shopping service, focusing on their needs and offering a huge amount of titles available to the customer. Bezos' innovation strategy has made Amazon a pioneer in setting market standards for the entire internet.
Answer:
Dr Bonds payable $50,700
Dr premium on bonds payable $4,265
Cr Cash $53,000
Cr gain on bonds retirement($50,700+$4,265-$53000) $1,965
Explanation:
The premium yet to be amortized on the bond at retirement is the carrying value minus face value i.e $54,965-$50,700=$4265
The premium on bonds payable would now be debited with $4265
The cash paid on retirement would be credited to cash account
The face value of the bonds payable of $50,700 would be debited to bonds payable in order to show that the obligation has been discharged.
Answer:
Required rate of return on clover's stock is 8.99%
Explanation:
The required rate of return on Clover's stock can be computed using Miller and Modgliani capital asset pricing model formula given below:
Ke=Rf+beta*(Rm-Rf)
Ke is the required rate of return, the unknown
Rf is the risk free rate of return of 4.00%
beta for Clover is 0.80
Rm is the not known as well but can computed using the Parr paper's details below:
beta is 1.442
required return IS 13%
13.00%=4.00%+1.442*(Rm-4.00%)
13%-4%=1.442*(Rm-4.00%)
9%=1.442*(Rm-4.00%)
9%/1.442=Rm-4%
6.24%
=Rm-4%
Rm=6.24%+4%
Rm=10.24%
Now the required return on Clover's stock can be computed
Ke=4%+0.8*(10.24%-4%)
Ke=8.99%
Answer:
a debit to accounts receivable and a credit to sales.
Explanation:
A periodic inventory system can be defined as a method of financial accounting, that typically involves updating informations about an inventory on a periodic basis (at specific intervals) as the sales or purchases are being made by the customers, through the use of either an enterprise management software applications or a digitized point-of-sale equipment.
Under a periodic inventory system, updates of the journal entry for cost of goods sold (sales) would include debiting accounts receivable and crediting sales on a periodic basis.
Additionally, the periodic system of inventory is a function of the cost of goods sold.
