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Tab 1 Shawn Paschal has been working on an advanced technology for use in the green fuel production at King Fisher Aviation.

Tab 1

Shawn Paschal has been working on an advanced technology for use in the green fuel production at King Fisher Aviation. He is almost finished with the technology and anticipates the first cash flow from the technology to be $200,000 received 2 years from today. Subsequent annual cash flows will grow at 4.5 percent in perpetuity.

What is the present value of the technology if the discount rate is 12 percent?

Fill in the value in the spreadsheet.

Tab 2

The previous financial manager had been evaluating the cash flows of a proposed project. The present value of the following cash stream is $9,300 when discounted at 10%.

Year 1 - Cash Flow $1,800

Year 2 - Cash Flow _______?

Year 3 - Cash Flow 2,900

Year 4 - Cash Flow 3,100

Fill in the values in the spreadsheet.

Tab 3

King Fisher Aviation has projected the following quarterly sales amounts for the coming year:

Quarter 1 $750

Quarter 2 $820

Quarter 3 $790

Quarter 4 $950

Accounts Receivable at the beginning of the year are $350. King Fisher has a 30 day collection period. Calculate the cash collections in each of the four quarters by completing the following for each quarter.

Beginning receivables

Sales

Cash Collections

Ending Receivables

Rework the Ending Receivables calculation using 45 and 60 days.

Fill in the values in the spreadsheet.

Tab 4

King Fisher Aviation purchases from suppliers in a quarter are equal to 65% of the next quarter's forecast sales. The payables period is 30 days. Wages, taxes, and other expenses are 25% of sales, and interest and dividends are $68 per quarter.

Projected quarterly sales are as follows.

Quarter 1 $1,300

Quarter 2 $1,400

Quarter 3 $1,400

Quarter 4 $1,200

Sales for the first quarter of the next year are projected to be $1,500. Calculate the company's cash outlays, by completing the following for each of the four quarters.

Payment of accounts

Wages, taxes, and other expenses

Long-term financing expenses (interest and dividends)

Total

Fill in the values in the spreadsheet.

Tab 5


Following are the most recent balance sheets for King Fisher Aviation.

Excluding accumulated depreciation, determine whether each item is a use of cash, and the amount:

Assets

 2015 

 2016 

Cash

49,280

44,816

Accounts Receivable

98,155

101,412

Inventories

82,400

87,715

Property, Plant, and Equipment

223,994

242,085

      Less: Accumulated depreciation

76,174

85,688

Total Assets

377,655

390,340

Liabilities and Equity

2015

2016

Accounts Payable

74,511

49,496

Accrued Expenses

10,790

7,740

Long-term debt

48,000

44,000

Common stock

25,000

30,000

Accumulated Retained Earnings

219,354

259,104

Total Liabilities and Equity.

377,655

390,340

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