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Group 5

activityyyyyyyyyyyyyyy

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Ziee Kiel
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10 views

Group 5

activityyyyyyyyyyyyyyy

Uploaded by

Ziee Kiel
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 7

Group 5:

Leader: Olac, Ezekiel B. BSA-C06


Members: Baling, Kimberly C.
Elbanbuena, Danielle J.
Juguan, Ma. Nenita P.
Trejeros, Angeline L.

FINMGT30

Activity 3:

Part I
Direct Method

Operating Activities:
Cash receipts from:
Customers $ 6, 140, 000

Cash paid for:


Merchandise: (5, 150,000)
Operating Expenses (880,000)
Interest Expense (20,000)
Income tax (102,000)

Net cash provided by operating Activities $


(12,000)

Investing Activities:
Long term investment $ (20,000)
Purchase of Property, land and equipment (530,000)

Net cash used in Investing activities $


(550,000)

Financing activities:
Notes Payable $ 500,000
Stocks 300,000
Dividend Paid (38,000)

Net cash provided by operating Activities $


762, 000
Net Increase in Cash $
200,000
Cash and equivalents at the beginning of the year
150,000
Cash and equivalents at the end of the year $
350, 000

Indirect Method

Cash flows from Operating Activities


Net Income $ 238, 000
Add: Non-cash assets
Depreciation 60, 000
Changes in working Capital
Increase in Inventory (240, 000)
Decrease in Prepaid Expenses 50,000
Increase in Receivables ( 260, 000)
Increase in Accrued Expense. 10,000
Increase in Interest Payable. 40,000
Increase in Payable 90, 000

Net Operating Activities $


(12, 000)

Cash flows from Investing Activities


Purchase of Plant, property and Equipment (530, 000)
Increase in Long term investment (20, 000)

Net Investing Activities $


(550, 000)

Cash flows from financing Activities


Increase in Notes payable 500, 000
Increase in Stocks 300, 000
Dividend Paid (38, 000)

Net Financing Activities $ 762,


000

Net Increase in Cash 200, 000

Cash balance, 2023 350,


000
Cash balance, 2022 (150,
000)
Increase in Cash $ 200,
000

Part 2

3-1

a.) What is the company’s total debt?

Total Assets $ 2, 500, 000


Less:
Notes Payable 150, 000
Long term borrowings 750, 000
Equity 1, 500, 000
Increase in Liabilities 100, 000

Notes Payable 150, 000


Long term Borrowings 750, 000
Increase in Liabilities 100, 000
Total Debt 1, 000, 00

b.) What is the amount of total liabilities and equity that appears on
the firm’s balance sheet?

Total Liabilities 1, 000, 000


Total Equity 1, 500, 000
Total Liabilities and Equity 2, 500, 000

c.)What is the balance of current liabilities on the firm’s balance sheet?


Current assets $
2,500,000
Non-current Assets (plant & equipment) (2,000,000)
Current Assets $
500,000

d.) What is the balance of current liabilities on the firm’s balance


sheet?

Liabilities $1,000,000
Long-term Debt- 750,000
Total Current Liabilities $250,000

e.) What is the amount of Accounts Payable and Accruals on


itsbalance sheet? [Hint: Consider this as a single line item on
thefirm’s balance sheet]

Accounts Payable and Accruals


Trade & other Payables = P 100, 000

f.) What is the firm’s net working capital?

Current assets $500,000


Current liabilities 250,000
Networking capital $250,000

g.) How much is the firm’s Net Operating Working Capital?

Current Asset – Non-interest-bearing current liabilities

500, 000 - 100, 000 = P 400, 000

h.) What is the explanation for the difference in your answers to


parts f & g?

- Net working capital (NWC) is the difference between the total


current assets and total liabilities of a business. On the other hand,
the Net operating working capital (NOWC) is one measurement of a
company’s financial health. It looks at how efficiently a company is
managing its current assets and liabilities. Unlike net working
capital, it excludes cash and cash equivalents, since they are not
tied up in operations.

3-13
Basel Industries
Statement of Cash Flows
For the year ended

Operating Income
Net Income 5, 000, 000
Add:
Depreciation Expense 450, 000
Total operating activities 5, 450,
000

Investing Activities
Property, plant, and equipment (5, 500,
000)
Total Investing Activities (5, 500,
000)

Financing Activities
Long - term debt issued
1,000,000
Dividends paid to common shareholders
(750,000)
Total Financing Activities
250,000

Net Changes in Cash Balance


Net cash flow from operating activities 5, 450, 000
Net cash flow from investing activities (5, 500, 000)
Net cash flow from financing activities 250, 000

Net changes in cash flow from 200, 000

End of the year cash balance


Beginning cash balance 100, 000
Net cash from operating activities 5, 450, 000
Net cash from investing activities (5, 500, 000)
Net cash from financing activities 250, 000
End of the year cash balance 350, 000

3-14
a.) 2015 2014
Current Assets $ 72, 125 $ 59,
000
Non- interest Bearing CL (18,400)
(15, 000)
NOWS (Net operating working capital) $ 53, 725
$ 44, 000

b.)
OCF
= $ 39, 000 (60%) + $ 5, 000
= $ 28, 400

Capital Expenditure
= ($50,000- 47,000) + 5,000
= $8, 000

Nowc = $ 53, 725 – 44, 000


= $ 9, 725

FCF = $ 28, 400 – (8, 000 + 9, 725)


= 28, 400 – 17, 725
= $ 10, 675

c.)
Bailey Corporation
Statement of Stockholders Equity
For the year ended December 31, 2025

Total Shareholder’s Equity, Jan. 1, 2025 $ 50,


000
Shares issued during the year ( 20, 850)
Total Investment $
70, 000

Net incom
Less: Dividends declared and paid
(11, 175)
Total Shareholder’s Equity December 31, 2015
$32, 025
d.)
EVA = $ 23, 400 – (0.10) ( $ 82, 025)
$ 23, 400 – 8, 202.50
= $ 15, 197.50e)

MVA = ( 5, 000 x $ 20) - $ 50, 000


= $ 100, 000 - $ 50, 000
= $ 50, 00

3-15
Hermann Industries

Sales 12, 681, 481. 48


O.C Excluding Dep and Amort. (6, 974, 814. 81)
Earnings before interest, tax, dep, and amort. 5, 706, 666. 67
Depreciation and Amort. (880, 000)
4, 826, 666.67
Interest (660, 000)
4, 166, 666.67
Tax (40%) (1, 666, 666.67)
Net Income 2, 500, 000

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