Connect Quizzes Ch. 1-5

The 2014 balance sheet of Steelo, Inc., showed current assets of $3,145 and current liabilities of $1,585. The 2015 balance sheet showed current assets of $3,000 and current liabilities of $1,500. What was the company's 2015 change in net working capital, or NWC?

$ -60.

You're trying to save to buy a new $170,000 Ferrari. You have $33,000 today that can be invested at your bank. The bank pays 4.0 percent annual interest on its accounts. How long will it be before you have enough to buy the car?

41.80 years

The Dyrdek Co. had $291,000 in 2014 taxable income. Use the tax rates from Table 2.3. Calculate the company's 2014 income taxes.

96,740.

A stakeholder is: A person who owns shares of stock. Any person who has voting rights based on stock ownership of a corporation. A person who initially founded a firm and currently has management control over that firm. A creditor to whom a firm currently owes money. Any person or entity other than a stockholder or creditor who potentially has a claim on the cash flows of a firm.

Any person or entity other than a stockholder or creditor who potentially has a claim on the cash flows of a firm.

Corporate bylaws: Must be amended should a firm decide to increase the number of shares authorized. Cannot be amended once adopted. Define the name by which the firm will operate. Describe the intended life and purpose of the organization. Determine how a corporation regulates itself.

Determine how a corporation regulates itself.

The Sarbanes-Oxley Act of 2002 is a governmental response to:

Management greed and abuses.

Which one of the following is an agency cost?

hiring outside accountants to audit the company's financial statements

The 2008 balance sheet of Maria's Tennis Shop, Inc., showed $880,000 in the common stock account and $6.3 million in the additional paid-in surplus account. The 2009 balance sheet showed $895,000 and $7.8 million in the same two accounts, respectively. If the company paid out $550,000 in cash dividends during 2009, What was the cash flow to stockholders for the year?

$-965,000

Saunders Corp. has current liabilities of $435,000, a quick ratio of .95, inventory turnover of 6.2, and a current ratio of 1.6. What is the cost of goods sold for the company?

$1,753,050.

Papa Roach Exterminators, Inc., has sales of $704,000, costs of $215,000, depreciation expense of $52,000, interest expense of $28,000, and a tax rate of 40 percent. What is the net income for firm?

$245,400

You have just received notification that you have won the $3.0 million first prize in the Centennial Lottery. However, the prize will be awarded on your 100th birthday (assuming you're around to collect), 70 years from now. What is the present value of your windfall if the appropriate discount rate is 7 percent?

$26,318.24

You are scheduled to receive $41,000 in two years. When you receive it, you will invest it for 9 more years at 7.0 percent per year. How much will you have in 11 years?

$75,376.83

Although appealing to more refined tastes, art as a collectible has not always performed so profitably. During 2003, a sculpture was sold at auction for a price of $10,309,500. Unfortunately for the previous owner, he had purchased it in 1999 at a price of $12,384,500. What was his annual rate of return on this sculpture?

-4.48%

Braam Fire Prevention Corp. has a profit margin of 9.70 percent, total asset turnover of 1.41, and ROE of 18.66 percent. What is its firm's debt-equity ratio?

0.36

Y3K, Inc., has sales of $6,189, total assets of $2,805, and a debt-equity ratio of 1.40. If its return on equity is 13 percent, what is its net income?

152.

Which one of these is a working capital management decision?

Determining the minimum level of cash to be kept in a checking account.

Billy's Exterminators, Inc., has sales of $652,000, costs of $298,000, depreciation expense of $50,000, interest expense of $35,000, a tax rate of 35 percent, and paid out $66,000 in cash dividends. The firm has 100,000 shares of common stock outstanding. What are the earnings per share? What are the dividends per share?

EPS: 1.7485 DPS: .66

Organic Chicken Company has a debt-equity ratio of 0.40. Return on assets is 8.40 percent, and total equity is $522,000.

Equity multiplier: 1.40 ROE: 11.76% Net Income: $61,387

Diamond Eyes, Inc., has sales of $18 million, total assets of $15.6 million, and total debt of $6.3 million. Assume the profit margin is 8 percent.

Net Income: $1440000.0 ROA: 9.23% ROE: 15.48%

Quarles Industries had the following operating results for 2015: sales = $27,660; cost of goods sold = $19,310; depreciation expense = $4,900; interest expense = $2,190; dividends paid = $1,000. At the beginning of the year, net fixed assets were $16,530, current assets were $5,770, and current liabilities were $3,270. At the end of the year, net fixed assets were $20,210, current assets were $7,116, and current liabilities were $3,810. The tax rate for 2015 was 35 percent.

Net Income: 819. OP. Cash Flow: 7,909. Cash Flow from assets: -1,477. Cash Flow to creditors: 2,190. Cash flow to stockholders: -3,667.

Which one of the following is a means by which shareholders can replace company management?

Proxy fight.