FIN MID TERM

Maxxie purchased a tract of land for $32,000. Today, the same land is worth $48,400. How many years have passed if the price of the land has increased at an annual rate of 5.2 percent?

8.16

Three years ago, you invested $2,750. Today, it is worth $3,500. What rate of interest did you earn?

8.37

Fancy Cat Products has a project that will cost $246,200 today and will generate monthly cash flows of $5,420 for the next 59 months. What is the rate of return of this project when expressed as an APR?

10.99

You are offered an investment that will pay • $200 in year 1, • $400 the next year, • $600 the following year, and • $800 at the end of the 4th year. You can earn 12 percent on similar investments. - What is the most you should pay for this one?

$1,432.93

A firm has net working capital of $440, net fixed assets of $2,186, sales of $5,500, and current liabilities of $750. How many dollars worth of sales are generated from every $1 in total assets?

$1.63

For the past year, Kayla, Inc., has sales of $43,847, interest expense of $2,840, cost of goods sold of $14,384, selling and administrative expense of $10,531, and depreciation of $4,530. If the tax rate is 38 percent, what is the operating cash flow?

$14,538

You need to have $20,000 for a down payment on a house in 5 years. If you can earn an annual interest rate of 5 percent, how much will you have to deposit today?

$15,670.52

Retirement Investment Advisors, Inc., has just offered you an annual interest rate of 5 percent until you retire in 40 years. You believe that interest rates will increase over the next year and you would be offered 5.6 percent per year one year from today. If you plan to deposit $16,000 into the account either this year or next year, how much more will you have when you retire if you wait one year to make your deposit?

$21,331.79

Marko, Inc., is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $6,500, $11,500, and $17,700 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has determined that a rate of return of 12 percent is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.?

$27,569.81

During the past year, a company had cash flow to stockholders, an operating cash flow, and net capital spending of $16,045, $38,440, and $17,460, respectively. The net working capital at the beginning of the year was $6,735 and it was $8,330 at the end of the year. What was the company's cash flow to creditors during the year?

$3,340

You are examining a company's balance sheet and find that it has total assets of $20,426, a cash balance of $2,154, inventory of $4,849, current liabilities of $5,701 and accounts receivable of $2,675. What is the company's net working capital?

$3,977

Micro, Inc., started the year with net fixed assets of $75,175. At the end of the year, there was $96,525 in the same account, and the company's income statement showed depreciation expense of $13,175 for the year. What was the company's net capital spending for the year?

$34,525

Your sister just deposited $10,000 into an investment account. She believes that she will earn an annual return of 9.7 percent for the next 6 years. You believe that you will only be able to earn an annual return of 9 percent over the same period. How much more must you deposit today in order to have the same amount as your sister in 6 years?

$391.56

During the past year, a company had cash flow to stockholders, an operating cash flow, and net capital spending of $15,367, $36,076, and $15,420, respectively. The net working capital at the beginning of the year was $6,213 and it was $7,430 at the end of the year. What was the company's cash flow to creditors during the year?

$4,072

You are going to deposit $3,400 in an account that pays .40 percent interest per month. How much will you have in 5 years?

$4,320.18

Five years from today, you plan to invest $2,950 for 8 additional years at 5.3 percent compounded annually. How much will you have in your account 13 years from today?

$4,459.12

You are going to deposit $3,700 in an account that pays .63 percent interest per quarter. How much will you have in 9 years?

$4,638.64

Disturbed, Inc., had the following operating results for the past year: sales = $22,630; depreciation = $1,420; interest expense = $1,144; costs = $16,545. The tax rate for the year was 30 percent. What was the company's operating cash flow

$5,029

At the beginning of the year, Nothing More, Corp., had a long-term debt balance of $38,054. During the year, the company repaid a long-term loan in the amount of $11,014. The company paid $4,330 in interest during the year, and opened a new long-term loan for $9,670. What was the cash flow to creditors during the year?

$5,674

During the past year, a company had cash flow to creditors, an operating cash flow, and net capital spending of $30,930, $70,755, and $31,480, respectively. The net working capital at the beginning of the year was $12,613 and it was $15,100 at the end of the year. What was the company's cash flow to stockholders during the year?

$5,858

Peggy Grey's Cookies has net income of $380. The firm pays out 35 percent of the net income to its shareholders as dividends. During the year, the company sold $83 worth of common stock. What is the cash flow to stockholders?

$50.00

Red Barchetta Co. paid $27,680 in dividends and $28,563 in interest over the past year. During the year, net working capital increased from $13,602 to $18,319. The company purchased $42,440 in fixed assets and had a depreciation expense of $16,985. During the year, the company issued $25,100 in new equity and paid off $21,140 in long-term debt. What was the company's cash flow from assets?

$52,283

During the past year, a company had cash flow to creditors, an operating cash flow, and net capital spending of $30,591, $69,573, and $30,460, respectively. The net working capital at the beginning of the year was $12,352 and it was $14,650 at the end of the year. What was the company's cash flow to stockholders during the year?

$6,224

Rousey, Inc., had a cash flow to creditors of $16,605 and a cash flow to stockholders of $7,055 over the past year. The company also had net fixed assets of $49,505 at the beginning of the year and $56,890 at the end of the year. Additionally, the company had a depreciation expense of $12,060 and an operating cash flow of $50,600. What was the change in net working capital during the year?

$7,495

Today, your dream car costs $66,600. You feel that the price of the car will increase at an annual rate 2.5 percent. If you plan to wait 5 years to buy the car, how much will it cost at that time?

$75,351.79

A firm has a return on equity of 22 percent. The total asset turnover is 2.1 and the profit margin is 5 percent. The total equity is $3,900. What is the net income?

$858

A small business has determined that the machinery they currently use will wear out in 17 years. To replace the new machine when it wears out, the company wants to establish a savings account today. If the interest rate on the account is 1.6 percent per quarter and the cost of the machinery will be $285,000, how much will the company have to deposit today?

$96,844.00

Samuelson's has a debt-equity ratio of 23 percent, sales of $6,500, net income of $1,500, and total debt of $7,700. What is the return on equity?

0.0448, or 4.48%

see the following information to answer this question. Windswept, Inc. 2017 Income Statement ($ in millions) Net sales $ 10,020 Cost of goods sold 8,110 Depreciation 500 Earnings before interest and taxes $ 1,410 Interest paid 118 Taxable income $ 1,292 Taxes 452 Net income $ 840 Windswept, Inc. 2016 and 2017 Balance Sheets ($ in millions) 2016 2017 2016 2017 Cash $ 300 $ 330 Accounts payable $ 1,650 $ 1,560 Accounts rec. 1,140 1,040 Long-term debt 1,170 1,370 Inventory 2,020 1,800 Common stock 3,480 3,460 Total $ 3,460 $ 3,170 Retained earnings 710 960 Net fixed assets 3,550 4,180 Total assets $ 7,010 $ 7,350 Total liab. & equity $ 7,010 $ 7,350 What is the quick ratio for 2017?

0.88

You want to buy a house that costs $220,000. You will make a down payment equal to 15 percent of the price of the house and finance the remainder with a loan that has an APR of 5.23 percent compounded monthly. If the loan is for 25 years, what are your monthly mortgage payments?

1,118.39

A firm has a return on equity of 18 percent. The total asset turnover is 1.7 and the profit margin is 6 percent. The total equity is $7,200. What is the net income?

1,296

You have just started a new job and plan to save $4,300 per year for 37 years until you retire. You will make your first deposit in one year. How much will you have when you retire if you earn an annual interest rate of 10.84 percent?

1,747,684.99

You want to buy a house and will need to borrow $270,000. The interest rate on your loan is 6.07 percent compounded monthly and the loan is for 25 years. What are your monthly mortgage payments?

1,751.19

A firm has net working capital of $420, net fixed assets of $2,166, sales of $5,300, and current liabilities of $730. How many dollars worth of sales are generated from every $1 in total assets?

1.60

Use the following information to answer this question. Windswept, Inc. 2017 Income Statement ($ in millions) Net sales $ 10,200 Cost of goods sold 7,750 Depreciation 400 Earnings before interest and taxes $ 2,050 Interest paid 92 Taxable income $ 1,958 Taxes 685 Net income $ 1,273 Windswept, Inc. 2016 and 2017 Balance Sheets ($ in millions) 2016 2017 2016 2017 Cash $ 240 $ 270 Accounts payable $ 1,630 $ 1,662 Accounts rec. 1,030 930 Long-term debt 1,030 1,313 Inventory 1,880 1,685 Common stock 3,280 2,990 Total $ 3,150 $ 2,885 Retained earnings 610 860 Net fixed assets 3,400 3,940 Total assets $ 6,550 $ 6,825 Total liab. & equity $ 6,550 $ 6,825 What is the equity multiplier for 2017?

1.77

You expect to receive a payout from a trust fund in 3 years. The payout will be for$11,000. You plan to invest the money at an annual rate of 6.5 percent until the account is worth $19,000. How many years do you have to wait from today?

11.68

You are in talks to settle a potential lawsuit. The defendant has offered to make annual payments of $29,000, $33,000, $68,000, and $102,000 to you each year over the next four years, respectively. All payments will be made at the end of the year. If the appropriate interest rate is 5.1 percent, what is the value of the settlement offer today?

119,637.99

What is the effective annual rate for an APR of 11.80 percent compounded quarterly?

12.33

For the past year, Kayla, Inc., has sales of $45,797, interest expense of $3,620, cost of goods sold of $16,134, selling and administrative expense of $11,481, and depreciation of $5,980. If the tax rate is 35 percent, what is the operating cash flow?

15,178

Maxxie purchased a tract of land for $23,500. Today, the same land is worth $59,700. How many years have passed if the price of the land has increased at an annual rate of 6.2 percent?

15.50

Todd can afford to pay $365 per month for the next 5 years in order to purchase a new car. The interest rate is 6.3 percent compounded monthly. What is the most he can afford to pay for a new car today?

18,744.69

One year ago, the Jenkins Family Fun Center deposited $3,800 into an investment account for the purpose of buying new equipment four years from today. Today, they are adding another $5,600 to this account. They plan on making a final deposit of $7,800 to the account next year. How much will be available when they are ready to buy the equipment, assuming they earn a rate of return of 6 percent?

21,445.05

Assuming an interest rate of 5.3 percent, what is the value of the following cash flows four years from today? Year Cash Flow 1 $2,975 2 $4,020 3 $5,860 4 $7,945

22,046.53

One year ago, the Jenkins Family Fun Center deposited $4,200 into an investment account for the purpose of buying new equipment four years from today. Today, they are adding another $6,000 to this account. They plan on making a final deposit of $8,200 to the account next year. How much will be available when they are ready to buy the equipment, assuming they earn a rate of return of 5 percent?

22,145.95

You need to have $30,000 for a down payment on a house in 6 years. If you can earn an annual interest rate of 4.8 percent, how much will you have to deposit today?

22,644.02

One year ago, you invested $3,400. Today, it is worth $4,150. What rate of interest did you earn?

22.06

Assuming an interest rate of 6.2 percent, what is the value of the following cash flows five years from today? Year Cash Flow 1 $3,515 2 $4,635 3 $5,605 4 $6,880

23,650.98

Marko, Inc., is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $4,900, $9,900, and $16,100 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has determined that a rate of return of 10 percent is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.?

24,732.53

Your grandparents put $11,000 into an account so that you would have spending money in college. You put the money into an account that will earn an APR of 4.35 percent compounded. If you expect that you will be in college for 4 years, how much can you withdraw each month?

250.10

You think you will be able to deposit $4,000 at the end of each of the next three years in a bank account paying 8 percent interest. You currently have $7,000 in the account. • How much will you have in 3 years? • How much in 4 years?

3 years= $21,803.58 4 years= $23,547.87

If you deposit $100 in one year, $200 in two years and $300 in three years. • How much will you have in three years at 7 percent interest? • How much in five years if you don't add additional amounts?

3 years= 628.49 5 years= 719.56

You are going to deposit $3,400 in an account that pays .60 percent interest per quarter. How much will you have in 5 years?

3,832.11

Fifth Fourth National Bank has a savings program which will guarantee you $16,000 in 14 years if you deposit $75 per month. What APR is the bank offering you on this savings plan?

3.31

Samuelson's has a debt-equity ratio of 20 percent, sales of $5,000, net income of $600, and total debt of $3,200. What is the return on equity?

3.75

Bob has saved $605 each month for the last 4 years to make a down payment on a house. The account earned an interest rate of .48 percent per month. How much money is in Bob's account?

32,570.39

Micro, Inc., started the year with net fixed assets of $76,300. At the end of the year, there was $98,100 in the same account, and the company's income statement showed depreciation expense of $14,030 for the year. What was the company's net capital spending for the year?

35,830

You are examining a company's balance sheet and find that it has total assets of $20,864, a cash balance of $2,316, inventory of $5,041, current liabilities of $6,085 and accounts receivable of $2,831. What is the company's net working capital?

4,103

Disturbed, Inc., had the following operating results for the past year: sales = $22,530; depreciation = $1,290; interest expense = $1,040; costs = $16,480. The tax rate for the year was 30 percent. What was the company's operating cash flow?

4,934

You are going to deposit $3,800 in an account that pays .44 percent interest per month. How much will you have in 5 years?

4,945.22

Use the following information to answer this question. Windswept, Inc. 2017 Income Statement ($ in millions) Net sales $ 9,750 Cost of goods sold 7,800 Depreciation 355 Earnings before interest and taxes $ 1,595 Interest paid 94 Taxable income $ 1,501 Taxes 450 Net income $ 1,051 Windswept, Inc. 2016 and 2017 Balance Sheets ($ in millions) 2016 2017 2016 2017 Cash $ 250 $ 270 Accounts payable $ 1,480 $ 1,732 Accounts rec. 1,050 950 Long-term debt 1,040 1,228 Inventory 1,720 1,630 Common stock 3,300 3,000 Total $ 3,020 $ 2,850 Retained earnings 620 870 Net fixed assets 3,420 3,980 Total assets $ 6,440 $ 6,830 Total liab. & equity $ 6,440 $ 6,830 Windswept, Inc., has 520 million shares of stock outstanding. Its price-earnings ratio for 2017 is 20. What is the market price per share of stock?

40.42

Your employer contributes $65 at the end of each week to your retirement account. The account will earn a weekly interest rate of .15 percent. How much will the account be worth when you retire in 30 years?

405,732.24

Peggy Grey's Cookies has net income of $330. The firm pays out 37 percent of the net income to its shareholders as dividends. During the year, the company sold $78 worth of common stock. What is the cash flow to stockholders?

44.1

A friend wants to borrow money from you. He states that he will pay you $4,300 every 6months for 11 years with the first payment exactly 6 years and six months from today. The interest rate is an APR of 6.6 percent with semiannual compounding. What is the value of the payments today?

45,051.35

Five years from today, you plan to invest $3,700 for 7 additional years at 5.8 percent compounded annually. How much will you have in your account 12 years from today?

5,490.37

The Green Giant has a 4 percent profit margin and a 30 percent dividend payout ratio. The total asset turnover is 1.2 times and the equity multiplier is 1.5 times. What is the sustainable rate of growth?

5.31

Red Barchetta Co. paid $27,590 in dividends and $28,437 in interest over the past year. During the year, net working capital increased from $13,554 to $18,269. The company purchased $42,220 in fixed assets and had a depreciation expense of $16,895. During the year, the company issued $25,050 in new equity and paid off $21,070 in long-term debt. What was the company's cash flow from assets?

52,047

Your sister just deposited $7,000 into an investment account. She believes that she will earn an annual return of 9.1 percent for the next 9 years. You believe that you will only be able to earn an annual return of 8.2 percent over the same period. How much more must you deposit today in order to have the same amount as your sister in 9 years?

541.81

Gerritt wants to buy a car that costs $30,250. The interest rate on his loan is 5.61 percent compounded monthly and the loan is for 5 years. What are his monthly payments?

579.35

At the beginning of the year, Nothing More, Corp., had a long-term debt balance of $38,429. During the year, the company repaid a long-term loan in the amount of $11,539. The company paid $4,615 in interest during the year, and opened a new long-term loan for $10,105. What was the cash flow to creditors during the year?

6,049

Myca Corp. has a project with the following cash flows. What is the value of the cash flows today assuming an annual interest rate of 8.6 percent? YearCash Flow 1 $1,540 2 $1,880 3 $2,150 4 $2,160

6,243.56

Rousey, Inc., had a cash flow to creditors of $17,235 and a cash flow to stockholders of $7,937 over the past year. The company also had net fixed assets of $49,855 at the beginning of the year and $57,310 at the end of the year. Additionally, the company had a depreciation expense of $12,396 and an operating cash flow of $51,538. What was the change in net working capital during the year?

6,515

Ken just purchased new furniture for his house at a cost of $17,200. The loan calls for weekly payments for the next 7 years at an annual interest rate of 11.47 percent. How much are his weekly payments?

68.78

Today, your dream car costs $57,800. You feel that the price of the car will increase at an annual rate 2.7 percent. If you plan to wait 7 years to buy the car, how much will it cost at that time?

69,649.97

When your father was born 50 years ago, his grandparents deposited $250 in an account for him. Today, that account is worth $11,000. What was the annual rate of return on this account?

7.86

We Pay Insurance Co. will pay you $1,150 each quarter for 26 years. You want to earn a minimum interest rate of .87 percent per quarter. What is the most you are willing to pay today for these payments?

78,489.58

Your parents are giving you $200 a month for 4 years while you are in college. At an interest rate of .47 percent per month, what are these payments worth to you when you first start college?

8,576.21

Mario's Home Systems has sales of $2,860, costs of goods sold of $2,200, inventory of $512, and accounts receivable of $434. How many days, on average, does it take Mario's to sell its inventory?

84.95

One of your customers has just made a purchase in the amount of $23,200. You have agreed to payments of $445 per month and will charge a monthly interest rate of 1.26 percent. How many months will it take for the account to be paid off?

85.43

When your father was born 49 years ago, his grandparents deposited $600 in an account for him. Today, that account is worth $58,000. What was the annual rate of return on this account?

9.78

You expect to receive a payout from a trust fund in 2 years. The payout will be for$12,400. You plan to invest the money at an annual rate of 7 percent until the account is worth $21,100. How many years do you have to wait from today?

9.86

You want to have $20,500 saved 4 years from today in order to make a down payment on a house. To fund this, you will make deposits each week from your paycheck into an account that will earn 4.43 percent compounded weekly. How much must you deposit each week?

90.13

A small business has determined that the machinery they currently use will wear out in 16 years. To replace the new machine when it wears out, the company wants to establish a savings account today. If the interest rate on the account is 1.9 percent per quarter and the cost of the machinery will be $325,000, how much will the company have to deposit today?

97,439.62

Retirement Investment Advisors, Inc., has just offered you an annual interest rate of 4.5 percent until you retire in 45 years. You believe that interest rates will increase over the next year and you would be offered 5.1 percent per year one year from today. If you plan to deposit $13,500 into the account either this year or next year, how much more will you have when you retire if you wait one year to make your deposit?

97,851.35