49. The cash flow of the firm must be equal to:
A. cash flow to equity plus cash flow to debtholders.
B. cash flow to debtholders minus cash flow to equity.
C. cash flow to governments plus cash flow to equity.
D. cash flow to equity minus cash flow to debtholders.
E. None of the above.
50. Which of the following are all components of the statement of cash flows?
A. Cash flow from internal activities, cash flow from external activities, and cash flow from financing activities
B. Cash flow from operating activities, cash flow from investing activities, and cash flow from divesting activities
C. Cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities
D. Cash flow from brokering activities, cash flow from profitable activities, and cash flow from non-profitable activities
E. None of the above.
51. A firm has $300 in inventory, $600 in fixed assets, $200 in accounts receivables, $100 in accounts payable, and $50 in cash. What is the amount of the current assets?
A. $500
B. $550
C. $600
D. $1,150
E. $1,200
52. The total assets are $1200, the fixed assets are $700, long-term debt is $600, and short-term debt is $400. What is the amount of net working capital?
A. $0
B. $100
C. $200
D. $300
E. $400
53. Brad’s Company has equipment with a book value of $500 that could be sold today at a 50 percent discount. Its inventory is valued at $400 and could be sold to a competitor for that amount. The firm has $50 in cash and customers owe them $300. What is the accounting value of its liquid assets?
A. $50
B. $350
C. $700
D. $750
E. $1,000
54. Martha’s Enterprises spent $2,400 to purchase equipment three years ago. This equipment is currently valued at $2,000 on today’s balance sheet but could actually be sold for $2,000. Net working capital is $300 and long-term debt is $900. Assuming the equipment is the firm’s only fixed asset, what is the book value of shareholders’ equity?
A. $200
B. $800
C. $1,200
D. $1,400
E. The answer cannot be determined from the information provided.
55. Art’s Boutique has sales of $640,000 and costs of $480,000. Interest expense is $40,000 and depreciation is $60,000. The tax rate is 34%. What is the net income?
A. $20,400
B. $39,600
C. $50,400
D. $79,600
E. $99,600
56. Given the tax rates as shown, what is the average tax rate for a firm with taxable income of $126,500?
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A. 21.38%
B. 23.88%
C. 25.76%
D. 34.64%
E. 39.00%