Under indirect method, depreciation is added back to net profit when arriving at the cash flow from operating activities because:
a. depreciation is an estimated amount.
b. depreciation is a noncash expenditure.
c. depreciation is not considered for calculation of taxable income.
d. is added to the net income to arrive at net cash provided by operating activities.
b
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________ occurs when decision makers fail to notice gradual changes over time.
Fill in the blank(s) with the appropriate word(s).
Mexico's Labor Laws are:
A. Weak, offering few, if any, rights to workers. B. Vigorously enforced by the federal and local governments. C. Effective at ensuring unions are controlled by workers, rather than by the company. D. Excellent on paper but not in practice.
Commercial Shipping, Inc., and Dock Services Corporation enter into a contract for Dock to load Commercial's barges for which Commercial agrees to pay Dock. Dock transfers its duty to load the barges to Riverside Freight Company. Dock is
A. a delegator. B. an assignor. C. an alien. D. an obligee.
CN Railways is North America's fifth largest railway. Forecast the financial statements for CN for Year 11. Use the percent of sales method based on Year 10 and the assumptions listed below
Please note the ratios to sales provided in the table which are useful for making the forecast. Sales growth of 10%. The cost of debt is 4.59%. The tax rate is 31.943%. The depreciation rate is 3%. CAPEX is $1,600 Million. The following accounts are constant: Intangible assets, Deferred taxes, and Common Stock. Long term debt is the PLUG variable. No dividends. Forecast the financial statements for CN. What are the additional funds needed (AFN) in Year 11? The AFN is the change in the plug account from Year 10 to Year 11. CN Railway Company Income Statement and Balance Sheet As of December 31, Year 10 ($ 000,000's) Year 10 Ratios Forecast Revenue $6,110 $6,721 COGS 2,550 0.417349 Dep. Exp. 499 SG&A 1,945 0.318331 EBIT 1,116 Int. Exp. 277 Income before Taxes 839 Income Taxes 268 Net income $571 ASSETS Year 10 Ratios Forecast Total Current Assets 1,163 0.190344 PP&E 16,898 Intangible assets 863 863 Total assets $18,924 Total Current liabilities 2,134 0.349264 Deferred Taxes 5,160 5,160 Long-term debt 5,003 Common Stock 3,558 3,558 Retained earnings 2,762 Total Owner's Equity 6,627 Total liabilities and Owner's equity 18,924 A) $64 million B) $165 million C) $342 million D) $580 million E) $965 million