Which financial projections include three estimates (optimistic, pessimistic, and most likely)?
A) sales forecasts
B) risk analyses
C) expense forecasts
D) break-even analyses
E) per-unit variable costs
B
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The statement of cash flows is used by outside parties in all but which of the following ways?
A. To assess equity values since the firm's value is dependent on the discounted present value of its expected future cash flows. B. To assess whether to underwrite an issue of debt or equity securities, using the firm's expected operating cash flows in the analysis. C. To assess if the proper amount of income taxes is reported and can be paid from current funds. D. To assess credit risk, as cash flows provide the resources for periodic interest and principal repayment.
Magnolia Company is considering the production and sale of a new product with the following sales and cost data: unit sales price, $350; unit variable costs, $180; total fixed costs, $399,500; and projected sales, $910,000. Round your answers to the nearest whole unit or dollar.(a) Calculate break-even in units.(b) Calculate break-even in dollars (use four decimal places when calculating the contribution margin ratio).(c) Calculate number of units that would need to be sold to generate an after-tax profit of $420,000 assuming a 30% tax rate.(d) Calculate dollar sales that would be needed to generate the same profit as above.(e) Calculate the margin of safety stated as a percentage using the $910,000 projected sales level.Be sure to label each calculation and show all calculations.
What will be an ideal response?
Which of the following represents the minimum legal financial obligation of a common stockholder if a firm is liquidated and additional funds are needed to repay its debt?
A. The redemption value of the common stock B. The par value of the common stock C. The earnings per share of the common stock D. The interest obligation per share of the common stock E. The market value per share of the common stock
Jakob received a $1,000 a year raise in January, sold stocks in March for $6,000 that were originally purchased for $4,000, and in July had a $100 monthly increase in mortgage payments on his adjustable rate mortgage
The increased mortgage payment started in July and was in effect for the remainder of the year. What was the total impact on Jakob's cash flow for the year? A) $1,000 B) $5,400 C) $6,400 D) $7,600