In its most recent financial statements, Nessler Inc. reported $75 million of net income and$825 million of retained earnings. The previous retained earnings were $784 million. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid.

Electronics World Inc. paid out $22.4 million in total common dividends and reported$144.7 million of retained earnings at year-end. The prior year’s retained earnings were $95.5 million. What was the net income? Assume that all dividends declared were actually paid.

In its most recent financial statements, Del-Castillo Inc. reported $70 million of net income and$900 million of retained earnings. The previous retained earnings were $855 million. How much in dividends did the firm pay to shareholders during the year?

The assets of Dallas & Associates consist entirely of current assets and net plant and equipment. The firm has total assets of $2.5 million and net plant and equipment equals$2 million. It has notes payable of $150,000, long-term debt of$750,000, and total common equity of $1.5 million. The firm does have accounts payable and accruals on its balance sheet. The firm only finances with debt and common equity, so it has no preferred stock on its balance sheet. a. What is the company’s total debt? b. What is the amount of total liabilities and equity that appears on the firm’s balance sheet? c. What is the balance of current assets on the firm’s balance sheet? d. What is the balance of current liabilities on the firm’s balance sheet? e. What is the amount of accounts payable and accruals on its balance sheet? (Hint: Consider this as a single line item on the firm’s balance sheet.) f. What is the firm’s net working capital? g. What is the firm’s net operating working capital? h. What is the explanation for the difference in your answers to parts f and g?

In its most recent financial statements, Nessler Inc. reported $75 million of net income and$825 million of retained earnings. The previous retained earnings were $784 million. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid.

In its most recent financial statements, Nessler Inc. reported 75 million dollars of net income and 825 million dollars of retained earnings. The previous retained earnings were 784 million dollars. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid.

Edmonds Industries is forecasting the following income statement: $$ \begin{matrix} \text{Sales} & \text{\$ 10.000.000}\\ \text{Operating costs excluding depreciation & amortization} & \text{5.500.000}\\ \text{EBITDA} & \text{\$ 4.500.000}\\ \text{Depreciation and amortization} & \text{1.200.000}\\ \text{EBIT} & \text{\$ 3.300.000}\\ \text{Interest} & \text{500.000}\\ \text{EBT} & \text{\$ 2.800.000}\\ \text{Taxes (40\\%)} & \text{1.120.000}\\ \text{Net income} & \text{\$ 1.680.000}\\ \end{matrix} $$ The CEO would like to see higher sales and a forecasted net income of $2,100,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 6%. The tax rate, which is 40%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate$2.000.000 in net income?

Over the years, Masterson Corporation’s stockholders have provided $34,000,000 of capital when they purchased new issues of stock and allowed management to retain some of the firm’s earnings. The firm now has 2,000,000 shares of common stock outstanding, and the shares sell at a price of$28 per share. How much value has Masterson’s management added to stockholder wealth over the years, that is, what is Masterson’s MVA?

Hampton Industries had $39,000 in cash at year-end 2015 and$11,000 in cash at year-end 2016. The firm invested in property, plant, and equipment totaling $210,000. Cash flow from financing activities totaled$120,000. a. What was the cash flow from operating activities? b. If accruals increased by $15,000, receivables and inventories increased by$50,000, and depreciation and amortization totaled $25,000, what was the firm’s net income?

You have just been hired as a financial analyst for Barrington Industries. Unfortunately, company headquarters (where all of the firm’s records are kept) has been destroyed by fire. So, your first job will be to recreate the firm’s cash flow statement for the year just ended. The firm had $100,000 in the bank at the end of the prior year, and its working capital accounts except cash remained constant during the year. It earned$5 million in net income during the year but paid $800,000 in dividends to common shareholders. Throughout the year, the firm purchased$5.5 million of machinery that was needed for a new project. You have just spoken to the firm’s accountants and learned that annual depreciation expense for the year is $450,000; however, the purchase price for the machinery represents additions to property, plant, and equipment before depreciation. Finally, you have determined that the only financing done by the firm was to issue long-term debt of$1 million at a 6% interest rate.What was the firm’s end-of-year cash balance? Recreate the firm’s cash flow statement to arrive at your answer.

Susan and Stan Britton are a married couple who file a joint income tax return, where the tax rates are based on the tax tables presented in the chapter. Assume that their taxable income this year was $375,000. a. What is their federal tax liability? b. What is their marginal tax rate? c. What is their average tax rate?

Barton Industries has operating income for the year of $3,500,000 and a 36% tax rate. Its total invested capital is$20,000,000 and its after-tax percentage cost of capital is 8%. What is the firm’s EVA?

Arlington Corporation’s financial statements (dollars and shares are in millions) are provided here. $$ \begin{matrix} \text{Balance Sheets as of December 31}\\ \text{ } & \text{2016} & \text{2015}\\ \text{Assets}\\ \text{Cash and equivalents} & \text{\$ 15.000} & \text{\$ 14.000}\\ \text{Accounts receivable} & \text{35.000} & \text{30.000}\\ \text{Inventories} & \text{33.320} & \text{27.000}\\ \text{Total current assets} & \text{\$ 83.320} & \text{\$ 71.000}\\ \text{Net plant and equipment} & \text{48.000} & \text{46.000}\\ \text{Total assets} & \text{\$ 131.320} & \text{\$ 117.000}\\ \text{Liabilities and Equity}\\ \text{Accounts payable} & \text{\$ 10.100} & \text{\$ 9.000}\\ \text{Accruals} & \text{8.000} & \text{6.000}\\ \text{Notes payable} & \text{7.000} & \text{5.050}\\ \text{Total current liabilities} & \text{\$ 25.100} & \text{\$ 20.050}\\ \text{Long-term bonds} & \text{20.000} & \text{20.000}\\ \text{Total liabilities} & \text{\$ 45.100} & \text{\$ 40.050}\\ \text{Common stack (4.000) shares)} & \text{40.000} & \text{40.000}\\ \text{Retained earnings} & \text{46.220} & \text{36.950}\\ \text{Common equity} & \text{\$ 86.220} & \text{\$ 76.950}\\ \text{Total liabilities and equity} & \text{\$ 131.320} & \text{\$ 117.000}\\ \end{matrix} $$ $$ \begin{matrix} \text{Income Statement for Year Ending December 31, 2016}\\ \text{Sales} & \text{\$ 210.000}\\ \text{Operating costs excluding depreciation and amortization} & \text{160.000}\\ \text{EBITDA} & \text{\$ 50.000}\\ \text{Depreciation & amortization} & \text{6.000}\\ \text{EBIT} & \text{\$44.000}\\ \text{Interest} & \text{5.350}\\ \text{EBT} & \text{\$ 38.650}\\ \text{Taxes (40\\%)} & \text{15.460}\\ \text{Net income} & \text{\$ 23.190}\\ \text{Dividends paid} & \text{\$ 13.920}\\ \end{matrix} $$ a. What was net operating working capital for 2015 and 2016? b. What was Arlington’s 2016 free cash flow? c. Construct Arlington’s 2016 statement of stockholders’ equity. d. What was Arlington’s 2016 EVA? Assume that its after-tax cost of capital is 10%. e. What was Arlington’s MVA at year-end 2016? Assume that its stock price at December 31, 2016, was $25.

Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information: She received $82,000 in salary. She received$12,000 of dividend income. She received $5,000 of interest income on Home Depot bonds. She received$22,000 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $9,000. She received$10,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $7,500. Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income. Assume that her tax rates are based on the tax tables presented in the chapter. a. What is Mary’s federal tax liability? b. What is her marginal tax rate? c. What is her average tax rate?