Attached below is the Balance Sheet of GoodWorld Incorporated Company. Calculate the WACC for the company by using the capital Structure value from the balance sheet.
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Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
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- Owners equity represents which of the following? A. the amount of funding the company has from issuing bonds B. the sum of the retained earnings and accounts receivable account balances C. the total of retained earnings plus paid-in capital D. the business owners/owners share of the company, also known as net worth or net assetsAccounting equation The total assets and total liabilities (in millions) of McDonalds Corporation (MCD) and Star-bucks Corporation (SBUX) follow:(Classification of Balance Sheet Accounts) Assume that Fielder Enterprises uses the following headings on its balance sheet. a. Current assets.b. Long-term Investments.c. Property, plant, and equipment.d. Intangible assets.e. Other assets.f. Current liabilities.g. Long-term liabilities.h. Capital stock.i. Paid-in capital in excess of par.j. Retained earnings. Instructions:Indicate by letter how each of the following usually should be classified. If an item should appear in a note to the financial statements, use the letter “N” to indicate this fact. If an item need not be reported at all on the balance sheet, use the letter “X.” 1. Prepaid insurance.2. Stock owned in another company.3. Unearned service revenue.4. Advances to suppliers.5. Unearned rent revenue.6. Preferred stock.7. Additional paid-in capital on preferred stock.8. Copyrights.9. Petty cash fund.10. Sales taxes payable.11. Accrued interest on notes receivable.12. Twenty-year issue of bonds payable that will mature within…
- Consider the following company’s balance sheet and income statement Return on assets. Return on equity.Use the following information from XYZ Company's balance sheet to answer the next six questions: Assets a. b. c. d. a. b. 30. C. d. Cash........ Marketable Securities Accounts Receivable Inventory........ Property and Equipment. Accumulated Depreciation. Total Assets a. b. c. d. Liabilities and Stockholders' Equity Accounts Payable. Notes Payable (current). Mortgage Payable (long-term). Bonds Payable (long-term). Common Stock, $50 Par.. The average number of common stock shares outstanding during the year was 840 shares. Net earnings for the year were $6,300. 25. XYZ's current ratio is 6.0 to 1. 5.5 to 1. 26. XYZ's quick (acid-test) ratio is 4.0 to 1. 4.5 to 1. 3.5 to 1. 3.0 to 1. Paid-in Capital in Excess of Par......... Retained Earnings............ Total Liabilities, and Stockholders' Equity 4.0 to 1. 4.5 to 1. ***** 27. XYZ's earnings per share is $7.50 per share. $7.00 per share. $0.13 per share. $6,300 per share. 28. XYZ's return on assets is a. 6.9% b. 7.9% C. 14.6% d. 23.4% 29.…Presented below are the captions of Faulk Company’s balance sheet. a. Current assets. b. Investments. c. Property, plant, and equipment. d. Intangible assets. e. Other assets. f. Current liabilities. g. Noncurrent liabilities. h. Capital stock. i. Additional paid-in capital. j. Retained earnings. Instructions Indicate by letter where each of the following items would be classified. 1. Preferred stock. 2. Goodwill. 3. Salaries and wages payable. 4. Accounts payable. 5. Buildings. 6. Equity investments (to be sold within one year). 7. Current maturity of long-term debt. 8. Premium on bonds payable. 9. Allowance for doubtful accounts. 10. Accounts receivable. 11. Cash surrender value of life insurance. 12. Notes payable (due next year). 13. Supplies. 14. Common stock. 15. Land. 16. Bond sinking fund. 17. Inventory. 18. Prepaid insurance. 19. Bonds payable. 20. Income taxes payable.
- Problem 3-8 Financial Statements (LO1) Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income statement for Omega Corp. Unfortunately, although the data for the individual items are correct, he is very confused as to whether an item should go in the balance sheet or income statement and whether it is an asset or liability. BALANCE SHEET $ 35 Payables Less accumulated depreciation Inventories $50 120 Receivables 35 Total current assets Total current liabilities Interest expense $ 25 Long-term debt Property, plant, and equipment $350 520 Total liabilities Net fixed assets Shareholders' equity $90 Total liabilities and Total assets shareholders' equity INCOME STATEMENT Net sales $700 Cost of goods sold Selling, general, and administrative expenses 580 38 ЕBIT Debt due for repayment $ 25 Cash 15 Taxable income Тахes $ 15 Depreciation 12 Net incomeThe accounting equation can be stated as: OA. Assets = Liabilities + Paid - in Capital + Retained Earnings. OB. Assets = Liabilities + Paid - in Capital Common Stock. C. Assets = Liabilities - Paid-in Capital - Dividends. D. Assets + Liabilities = Stockholders' Equity. -Assume that Fielder Enterprises uses the following headings on its balance sheet. a. Current assets. b. Investments. c. Property, plant, and equipment. d. Intangible assets. e. Other assets. f. Current liabilities. g. Long-term liabilities. h. Capital stock. i. Equity attributed to noncontrolling interest. j. Paid-in capital in excess of par. k. Retained earnings. Instructions Indicate by letter how each of the following usually should be classified. If an item should appear in a note to the financial statements, use the letter “N” to indicate this fact. If an item need not be reported at all on the balance sheet, use the letter “X.” 1. Prepaid insurance. 2. Stock owned in affiliated companies. 3. Unearned service revenue. 4. Advances to suppliers. 5. Unearned rent revenue. 6. Preferred stock. 7. Additional paid-in capital on preferred stock. 8. Copyrights. 9. Petty cash fund. 10. Sales taxes payable. 11. Accrued…
- As a Finance Manager of the company you are required to: Requirement : 1 Calculate the following from the Balance Sheet: A Total fixed assets B Total long term liabilities C Total current assets D Total current liabilities E Shareholders’ funds F Capital employedThe statement of financial position of Trend, Inc. is presented below. These are the only accounts in Trend's statement of financial position. Amounts indicated by question mark (?) can be calculated from the additional information given Cash Accounts rereivahle(net) Inventory Property. Dant and equipment (net ota LIabilitieS and Stockholders Equity Accounts Davable trade Income taxes Davable (current) Long-term debt Common stock Retained earnings Total Additional Information Gurrent ratio (at vear end) Total liabilities divided by total stockholders' equity 25,000 294,000 432,000 25.000 300.000 slavento turnover based on sales and ending inventor Inventor turnover based on cost of goods sold and ending inventory Gross margin for the year 1,5 to 1 0.8 15 times 10.5 times P315,000 What was rend' balance in trade accounts payable at year-end? What was Trend's balance in retained earnings at year-end? Was rends Dalance in the inventory account at year-end? The balance of Accounts…The following are the major balance sheet classifications Current Assets (CA) Current Liabilities (CL) Intangible Assets (IA) Long-term Investments (LTI) Property, Plant, and Equipment (PPE) Long-term Liabilities (LTL) Stockholder's Equity (SE) Classify each of the following accounts taken from Raman Company's balance sheet. Accounts Payable Accounts Receivable Cash Common stock Patents Salaries and Wages Payable Inventory Stock Investments (to be sold in 7 months)