Ch 2 Quiz - Natasha Charles Case problem 1 Your Turn 2 2.1:...

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1. Problem 2-1 Balance Sheet (LG1) Evaluating the balance sheet for Goodman's Bees Corporation. From the balance sheet find the following balances: cash and marketable securities = $400,000, accounts receivable = $1,200,000, inventory = $2,100,000, accrued wages and taxes = $500,000, accounts payable = $800,000, and notes payable = $600,000. Calculate Goodman Bee's net working capital. (Omit the "$" sign in your response.) Net working capital $ Explanation: Net working capital = current assets − current liabilities. Goodman's Bees current assets = Cash and marketable securities $ 400,000 Accounts receivable $ 1,200,000 Inventory $ 2,100,000 Total current assets $ 3,700,000 and current liabilities = Accrued wages and taxes $ 500,000 Accounts payable $ 800,000 Notes payable $ 600,000 Total $ 1,900,000
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current liabilities So the firm's net working capital was $1,800,000 ($3,700,000 − $1,900,000). 2. Problem 2-2 Balance Sheet (LG1) Zoeckler Mowing & Landscaping's year-end 2009 balance sheet lists current assets of $256,000, fixed assets of $324,000, current liabilities of $245,000, and long-term debt of $185,000. Calculate Zoeckler's total stockholders' equity. (Omit the "$" sign in your response.) Stockholders' equity $ Explanation: Assets = Liabilities + Equity. Rearranging this equation: Equity = Assets – Liabilities. Thus, the balance sheets would appear as follows: Book value Book value Assets Liabili ties and Equity Current assets $256,000 Curre nt liabilities $245,000 Fixed assets 324,000 Long- term debt 185,000 Stock holders' equity 150,000 Total $580,000 Total $580,000
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3. Problem 2-3 Income Statement (LG1) Reed's Birdie Shot, Inc.'s 2008 income statement lists the following income and expenses: EBIT = $538,000, interest expense = $63,000, and net income = $435,000. Calculate the 2008 taxes reported on the income statement. (Omit the "$" sign in your response.) Taxes $ Explanation: EBIT $ 538,000 Interest expense 63,000 EBT 475,000 Taxes 40,000 Net income $ 435,000 4. Problem 2-5 Corporate Taxes (LG3) Oakdale Fashions Inc. had $245,000 in 2008 taxable income. Using the tax schedule in Table 2- 3 1. Calculate the company's 2008 income taxes. (Round your answer to the nearest whole number. Omit the "$" sign in your response.) Income taxes $ 78,800 2. What is the average tax rate? (Round your answer to 2 decimal places. Omit the "%" sign
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in your response.) Average tax rate 32.16 % 3. What is the marginal tax rate? (Omit the "%" sign in your response.) Marginal tax rate 39 % 5. Problem 2-6 Corporate Taxes (LG3)
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This document was uploaded on 10/29/2011 for the course FIN 320 at Jackson State.

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Ch 2 Quiz - Natasha Charles Case problem 1 Your Turn 2 2.1:...

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