Bus 106 HW Assignment 1
Francis Anand
1/13/17

Balance Sheet

Assets Liabilities
Current Assets:Current Liabilities:
-Cash balances-\$10,000-Accounts Payable-\$17,000
-Inventory-\$200,000Long Term Liabilities:
-Accounts Receivable-\$22,000-Long Term Debt-\$170,000
Property, Plant, Equipment:
-Store + Property-\$100,000

Total Assets - \$332,000Total Liabilities - \$187,000

Equity = 332,000 - 187,000 = \$145,000

A) Net Income: 2,000 = 20% of revenue so Revenue is 10,000 - (8,000+2000+3000+1000+1000)= -\$5,000
B) Revenue: 2,000 = 20% of revenue so Revenue is \$10,000
C) EBIT: 10,000 - (8,000++3000+1000+1000) = -\$3,000

Dividends Paid: (3,700,000+900,000) - 3,400,000 = \$1,200,000

A) Book Value: \$200,000
Market Value: \$50,000,000
B) Price Per Share: 50mil/2Mil = \$25Mil
Book Value Per Share: 200,000/2mil = \$0.1

A) Increase
B) Increase
C) Decrease

A) Net Income: 14mil - (8mil+2mil+1mil) = \$3Mil
Cash Flow: 3Mil + 2Mil +1Mil = \$5Mil
B) Net Income would decrease by 1Mil but Cash flow would not be affected
C) This would have a negative impact on the firm's stock
D) Net Income would decrease by 3Mil
E) Cash Flow would decrease by 2Mil

A) Market Value added: 657 x 83 = \$54,531
B) Market to Book Ratio: 54531/42524 = 1.3
C) Yes the company has created value for shareholders

A) Economic Value Added: 627 - (108+325) = 194
B) Return on Capital: 534 - (108+325) = 101
C) Return on Equity: 534/256 = 2.09
D) Yes, the company is creating value for its shareholders.