【導(dǎo)讀】raisecapital,andunlimitedlife.tradedornot).equityofthefirm.

　　

【正文】 assets, we must first calculate the operating cash flow. The ine statement is: Ine Statement Sales $ 8, Costs 3, Depreciation expense 738 .00 EBIT $3, Interest expense 211 .00 EBT $3, Taxes (35%) 1, Net ine $2, So, the operating cash flow is: OCF = EBIT + Depreciation – Taxes = $3,681 + 738 – 1, = $3, And the cash flow from assets is: Cash flow from assets = OCF – Change in NWC – Net capital spending. = $3, – 22 – 1,287 = $1, d. Net new borrowing = LTD09 – LTD08 = $1,512 – 1,422 = $90 Cash flow to creditors = Interest – Net new LTD = $211 – 90 = $121 Net new borrowing = $90 = Debt issued – Debt retired Debt retired = $270 – 90 = $180 Challenge 23. Net capital spending = NFAend – NFAbeg + Depreciation = (NFAend – NFAbeg) + (Depreciation + ADbeg) – ADbeg = (NFAend – NFAbeg)+ ADend – ADbeg = (NFAend + ADend) – (NFAbeg + ADbeg) = FAend – FAbeg CHAPTER 2 B13 24. a. The tax bubble causes average tax rates to catch up to marginal tax rates, thus eliminating the tax advantage of low marginal rates for high ine corporations. b. Taxes = ($50,000) + ($25,000) + ($25,000) + ($235,000) = $113,900 Average tax rate = $113,900 / $335,000 = 34% The marginal tax rate on the next dollar of ine is 34 percent. For corporate taxable ine levels of $335,000 to $10 million, average tax rates are equal to marginal tax rates. Taxes = ($10,000,000) + ($5,000,000) + ($3,333,333)= $6,416,667 Average tax rate = $6,416,667 / $18,333,334 = 35% The marginal tax rate on the next dollar of ine is 35 percent. For corporate taxable ine levels over $18,333,334, average tax rates are again equal to marginal tax rates. c. Taxes = ($200,000) = $68,000 $68,000 = ($50,000) + ($25,000) + ($25,000) + X($100,000)。 X($100,000) = $68,000 – 22,250 X = $45,750 / $100,000 X = % 25. Balance sheet as of Dec. 31, 2020 Cash $3,792 Accounts payable $3,984 Accounts receivable 5,021 Notes payable 732 Inventory 8,927 Current liabilities $4,716 Current assets $17,740 Longterm debt $12,700 Net fixed assets $31,805 Owners39。 equity 32,129 Total assets $49,545 Total liab. amp。 equity $49,545 Balance sheet as of Dec. 31, 2020 Cash $4,041 Accounts payable $4,025 Accounts receivable 5,892 Notes payable 717 Inventory 9,555 Current liabilities $4,742 Current assets $19,488 Longterm debt $15,435 Net fixed assets $33,921 Owners39。 equity 33,232 Total assets $53,409 Total liab. amp。 equity $53,409 B14 SOLUTIONS 2020 Ine Statement 2020 Ine Statement Sales $7, Sales $8, COGS 2, COGS 2, Other expenses Other expenses Depreciation 1, Depreciation 1, EBIT $3, EBIT $3, Interest Interest EBT $2, EBT $2, Taxes (34%) Taxes (34%) 1, Net ine $1, Net ine $1, Dividends $ Dividends $1, Additions to RE Additions to RE 26. OCF = EBIT + Depreciation – Taxes = $3,543 + 1,085 – 1, = $3, Change in NWC = NWCend – NWCbeg = (CA – CL) end – (CA – CL) beg = ($19,488 – 4,742) – ($17,740 – 4,716) = $1,722 Net capital spending = NFAend – NFAbeg + Depreciation = $33,921 – 31,805 + 1,085 = $3,201 Cash flow from assets = OCF – Change in NWC – Net capital spending = $3, – 1,722 – 3,201 = –$1, Cash flow to creditors = Interest – Net new LTD Net new LTD = LTDend – LTDbeg Cash flow to creditors = $579 – ($15,435 – 12,700) = –$2,156 Net new equity = Common stockend – Common stockbeg Common stock + Retained earnings = Total owners‘ equity Net new equity = (OE – RE) end – (OE – RE) beg = OEend – OEbeg + REbeg – REend REend = REbeg + Additions to RE08 ? Net new equity = OEend – OEbeg + REbeg – (REbeg + Additions to RE08) = OEend – OEbeg – Additions to RE Net new equity = $33,232 – 32,129 – = $ CFS = Dividends – Net new equity CFS = $1,011 – = $ As a check, cash flow from assets is –$1,. CFA = Cash flow from creditors + Cash flow to stockholders CFA = –$2,156 + = –$1, CHAPTER 3 WORKING WITH FINANCIAL STATEMENTS Answers to Concepts Review and Critical Thinking Questions 1. a. If inventory is purchased with cash, then there is no change in the current ratio. If inventory is purchased on credit, then there is a decrease in the current ratio if it was initially greater than . b. Reducing accounts payable with cash increases the current ratio if it was initially greater than . c. Reducing shortterm debt with cash increases the current ratio if it was initially greater than . d. As longterm debt approaches maturity, the principal repayment and the remaining interest expense bee current liabilities. Thus, if debt is paid off with cash, the current ratio increases if it was initially greater than . If the debt has not yet bee a current liability, then paying it off will reduce the current ratio since current liabilities are not affected. e. Reduction of accounts receivables and an increase in cash leaves the current ratio unchanged. f. Inventory sold at cost reduces inventory and raises cash, so the current ratio is unchanged. g. Inventory sold for a profit raises cash in excess of the inventory recorded at cost, so the current ratio increases. 2. The firm has increased inventory relative to other current assets。 therefore, assuming current liability levels remain unchanged, liquidity has potentially decreased. 3. A current ratio of means that the firm has twice as much in current liabilities as it does in current assets。 the firm potentially has poor liquidity. If pressed by its shortterm cre