What does a subreport typically display?

Maggie's Muffins, Inc., generated $2,000,000 in sales during 2015, and its year-end total assets were $1,400,000. Also, at year-

Ksenya-84 [330]

Answer:

The Sales will increase by $350,000 (2000,000 * 17.5%)

Explanation:

As we know that,

Self Supporting Growth Rate = Return on Equity * (1 - Payout Ratio) ...Eq1

Here

Payout ratio given is 50%

and

Return on Equity = 35% (Step 1)

By putting values in Eq1, we have:

Self Supporting Growth Rate = 35% * (1 - 50%)

Self Supporting Growth Rate = 17.5%

Which means that Sales will increase by $350,000 (2000,000 * 17.5%) which is 17.5%.

Step 1: Find Return on Equity

We know that:

Return on Equity = Net Income / Equity ..............Eq2

As we are not given value of Net Income we can not calculate the value of return on equity. But there is another way that we can calculate by simply multiplying and dividing by sales on Left hand side of the Eq2 equation.

Return on Equity = Net Income / Equity * Sales / Sales

By rearranging, we have:

Return on Equity = Net Income / Sales * Sales / Equity

Now here,

Net Income / Sales = Profit Margin

By putting this in the above equation, we have:

Return on Equity = Profit Margin * Sales / Equity

Here

Profit Margin is 7% given in the question.

Sales were $2,000,000

And

Equity is $400,000 (Step 2)

By putting values, we have:

Return on Equity = 7% * $2,000,000 / $400,000

Return on Equity = 35%

Step 2. Find Equity

Equity = Assets - Liabilities

Here,

Assets are worth $1,400,000

Liabilities are standing at $1,000,000 which includes only current liabilities because company doesn't have any long term borrowings

By putting the values, we have:

Equity = $1,400,000 - $1,000,000 = $400,000

Brother, don't forget to rate the answer.

5 0

3 years ago

What type of arrangement(s), if any, would avoid double taxation for Wendall's and Shirley's endeavor? Choose the best answer if

musickatia [10]

Answer:

An s corporation or a limited liability company, but not a corporation.

Explanation:

5 0

3 years ago

A machine cost $1,238,000 on April 1, 2020. Its estimated salvage value is $139,200 and its expected life is 4 years. Calculate

natulia [17]

Answer:

The depreciation expense by straight-line for 2020: $206,025
The depreciation expense by double-declining balance for 2021: $619,000
The depreciation expense by sum-of-the-years'-digits for 2021: $329,640

Explanation:

Under straight-line method, depreciation expense is (cost - residual value) / No of years = ($1,238,000 - $139,200) / 4 years = $274,700 yearly depreciation expense.

Depreciation expense by straight-line for 2020 will be (April 1, 2020 - Dec. 31, 2020): $274,700 / 12 x 9 = $206,025.

The double-declining method is otherwise known as the reducing balance method and is given by the formula below:

Double declining method = 2 X SLDP X BV

SLDP = straight-line depreciation percentage

BV = Book value

SLDP is 100%/4 years = 25%, then 25% multiplied by 2 to give 50% or simply 1/2

Depreciation expense under double-declining method at December 31, 2021: $1,238,000 x 1/2 = $619,000

Under the sum-of-the-years'-digits, the depreciation expense for 2021 will be calculated as follows: 3 / 10 = 30%.

10 was derived by 4 + 3 + 2 + 1 for Year 2020, 2021, etc

($1,238,000 - $139,200) x 30% = $329,640

4 0

4 years ago

Income Statement For the Year Ended on December 31 J&H Corp. Industry Average Net sales $39,000,000 $48,750,000 Operating co

noname [10]

Answer:

1.J&H Corp’s NOPAT is $3,744,000, which is $936,000 lower than industry average of $4,680,000

2.Net operating working capital of $18,000 is been used by the company.

3.J&H Corp will be generating $5,019,600 in net cash flow from its operations and an accounting profit of $3,369,600

4.Therefore the firm uses $978,000 of total net operating capital to run the business.

Explanation:

J&H Corp

1. Calculation for NOPAT

NOPAT = 6,240,000 x (1- 40%)

= 6,240,000 x (1 – 0.4)

= 6,240,000 x 0.6

= $3,744,000

Calculation for Industry Average

Industry Average= 7,800,000 x (1- 40%)

7,800,000×(1-0.4)

7,800,000×0.6

=$4,680,000

Hence:

($4,680,000-$3,744,000)=$936,000

J&H Corp’s NOPAT is $3,744,000, which is $936,000 lower than industry average of $4,680,000

2:Calculation for Net Operating Working Capital

Net Operating Working Capital= Current Operating Assets − Current Operating Liabilities

Net Operating Working Capital= (Cash + Accounts Receivable + Inventories)− (Accounts Payable + Accrued Expenses)

Short term investments won't be included in Current Operating Assets

Given current assets = $600,000 ×12% in Short term investments = $72,000

Therefore Current Operating Assets will be: 600,000 – 72,000 = $528,000

Current Operating Liabilities = $510,000

Net Operating Working Capital

= $528,000 - $510,000 = $18,000

Net operating working capital of $18,000 is been used by the company.

3. Calculation for Net cash flow operations

Net cash flow from operations = Net income + Depreciation & Amortization + Changes in Working Capital

Changes in working capital = Working capital of the year

= $600,000 - $510,000

= $90,000

Net cash flow from operations will be:

$3,369,600 + $1,560,000 + $90,000 = $5,019,600

The Accounting profit will be the total revenue less the explicit costs

Explicit costs includes operating expenses, depreciation, interest and taxes.

Hence, the Accounting Profit will be :

Net income = $3,369,600

J&H Corp will be generating $5,019,600 in net cash flow from its operations and an accounting profit of $3,369,600

4. Calculation for the Total net operating capital

Total net operating capital = Net Operating Working Capital + Non-current Operating Assets

$528,000 - $510,000 = $18,000

Net Operating Working Capital = $18,000

Non-current Operating Assets = operating long term assets = $960,000

Total net operating capital

= $18,000 + $960,000

= $978,000

Therefore the firm uses $978,000 of total net operating capital to run the business. Thus the value is been computed as the sum of J&H Corp’s net operating working capital and its Non-current Operating Assets.

4 0

4 years ago

If a firm favors a push strategy, using direct selling to educate potential consumers about the features of its products, what k

BigorU [14]

Answer:

industrial products

Explanation:

A company that does this and mostly favors a push strategy is usually selling industrial products. That is because a push strategy focuses on taking the product to the potential customer and showing them how it works as well as how it can benefit them, therefore pushing the product on them. Industrial Products are great for such a strategy since they require actual demonstration and can easily show the potential customer the actual value that the product can provide.

3 0

3 years ago