Exam_1_Wi08

# Exam_1_Wi08 - Management 120A Winter 2008 Danny S Litt Solution Exam 1 I agree to have my grade posted by Student ID Number(Signature(Student ID

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Management 120A Winter 2008 Danny S. Litt Solution Exam 1 I agree to have my grade posted by Student ID Number ________________ _________________ (Signature) (Student ID Number) Name: ________________ PROBLEM POINTS SCORE 1 20 2 10 3 40 4 20 5 40 6 20 7 15 8 10 9 10 10 15 TOTAL 200

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Management 120A Winter 2008 Page | 1 Problem 1 The following information (All in \$ Millions) comes from the 2006 annual report of Apple Computers, Inc.: Apple Computers, Inc. 2006 \$ millions Net sales 19,315 Total assets 17,205 End of year balance in cash and cash equivalents (CCE) 6,392 Total stockholders’ equity (deficit) 9,984 Gross profit (Sales – Cost of Goods Sold) 5,598 Net increase in cash and cash equivalents (CCE) 2,901 Operating expenses 3,145 Net increase in CCE from operating activities 2,220 Other income, net (464) Required: Compute the following information: Balance in cash and cash equivalents (CCE) at beginning of 2006 \$3,491 Total liabilities at the end of 2006 \$7,221 Cost of Goods Sold \$13,717 Net Income \$1,989 Ending cash and CCE \$6,392 less increase in cash and CCE \$2,901 Cash and CCE at beginning \$3,491 Total Assets \$17,205 Less Total Stockholders Equity \$9,984 Total Liabilities \$7,221 Net sales \$19,315 Gross Profit \$5,598 COGS \$13,717 Gross profit \$5,598 Less Operating expense \$3,145 Plus Other income (\$464) Net Income \$1,989
Management 120A Winter 2008 Page | 2 Problem 2 Molly's Auto Detailers maintains its records on the cash basis. During 2006, Molly's collected \$72,000 from customers and paid \$21,000 in expenses. Depreciation expense of \$5,000 would have been recorded on the accrual basis. Over the course of the year, accounts receivable increased \$4,000, prepaid expenses decreased \$2,000, and accrued liabilities decreased \$1,000. Molly's accrual basis net income would be: Required : The accrual basis net income for Molly is: ________\$49,000_________________ Cash receipts \$72,000 Cash disbursements 21,000 Cash basis net income 51,000 Deduct depreciation expense (5,000) Add increase in accounts receivable 4,000 Deduct decrease in prepaid expenses (2,000) Add decrease in prepaid expenses 1,000 Accrual basis net income \$49,000

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Management 120A Winter 2008 Page | 3 Problem 3 The following balance sheet information (in \$ millions) comes from the Annual Report to Shareholders of Marriott International Inc. for the year ended, January 2, 2004. Certain amounts have been blackened out to test your understanding of balance sheets. In addition, you are provided with the following information from an analysis of Marriott's financial position at the same date: Current ratio 0.6973 Acid test ratio 0.5240 Debt/Equity ratio 1.13109 Required : Compute the missing amounts (rounded to the nearest \$millions) in the Marriott balance sheet. ASSETS
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## This test prep was uploaded on 04/04/2008 for the course MGMT 120A taught by Professor Litt during the Spring '08 term at UCLA.

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Exam_1_Wi08 - Management 120A Winter 2008 Danny S Litt Solution Exam 1 I agree to have my grade posted by Student ID Number(Signature(Student ID

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