Unit 1: Homework Assignment
- From a Christian worldview, and incorporating the assigned scripture, what does it mean to be ethical in business dealings and corporate governance?
- What is the balance sheet identity? Discuss the book value of a firm versus its market value. What is meant by financial leverage? What is the definition of a noncash item and describe one noncash item on the income statement?
- What is the income statement? The EPS? The net operating income? Discuss other major items on an income statement?
- Problems:
- BU, Inc. has current assets of $6,050, net fixed assets of $24,750, long-term debt of $11,400, and current liabilities of $4500. What is the value of the shareholders’ equity account for the firm? What is the networking capital?
- Salty Chips has sales of $862,000, operating costs of $85,000, depreciation expense of $41,000, interest expense of $40,500 and a tax rate of 20%. What is the net income? What if the firm paid out $125,000 in cash dividends? What is the addition to retained earnings?
2019 2020
Sales $11,573 $12,936
Depreciation 1661 1736
Cost of goods sold 3979 4707
Other Expenses 946 824
Interest Expense 776 926
Cash 6067 6466
Accounts Receivables 8034 9427
Short-term Notes Payable 1171 1147
Long-term debt 20,320 24,696
Net fixed assets 50,888 54,273
Accounts Payable 4,384 4,644
Tax rate 34% 34%
Inventory 14,283 15,288
Payout ratio 33% 33%
3. Create the Income Statement and Balance Sheet for 2020.
