FIN 370 Week 2 MyfinanceLab complete

FIN 370 Week 2 MyFinanceLab CompleteFIN 370 Week 2My Finance LabProblem 1Preparing common-size financial statementsThe balance sheet and income statement for Carver Enterprises, Inc. are found here:Problem 2Analyzing common-size financial statementsUse the common size financial statements found here to respond to your boss’ request that you write up your assessment of the firm’s financial condition. Specifically, write up a brief narrative that responds to the following questions: How much cash does Carver have on hand relative to its total assets?Problem 3Using common-size financial statementsThe S&H Construction Company expects to have total sales next year totaling $14,500,000. ln addition, the firm pays taxes at 35 percent and will owe $286,000 in interest expense. Based on last year’s operations the firm’s management predicts that its cost of goods sold will be 60 percent of sales and operating expenses will total 26 percent. What is your estimate of the firm’s net income (after taxes) for the coming year?Problem 4Liquidity analysisAirspot Motors, Inc. has $2,523,000 in current assets and $870,000 in current liabilities. The company’s managers want to increase the firm’s inventory, which will be financed using short-term debt. How much can the firm increase its inventory without its current ratio falling below 2.1 (assuming all other current assets and current liabilities remain constant)Problem 5Future valueTo what amount will $5,200 invested for 10 years at 9 percent compounded annually accumulate?Problem 6Future valueLeslie Mosallam, who recently sold her Porsche, placed S 10,600 in a savings account paying annual compound interest of 5 percent.Problem 7Related to the Business of Life: Saving for Your First House Future valueYou are hoping to buy a house in the future and recently received an inheritance of $20,000. You intend to use your inheritance as a down payment on your house.Problem 8Future valueBob Terwilliger received $13,881 tor his services as financial consultant to the mayor’s office of his hometown of Springfield. Bob says that his consulting work was his civic duty and that he should not receive any compensation. So, he has invested his paycheck into an account paying 3.59 percent annual interest and left the account in his will to the city of Springfield on the condition that the city could not collect any money from the account for 160 years. How much money will the city receive in 160 years from Bob’s generosity?Problem 9Calculating expected revenuesThe owner of the Crusik Distribution Company is evaluating the expected annual sales tor a new line of facial care products and estimates that there is a 53 percent chance that the product line will be extremely successful, in which case it will generate sales next year of 5.5 million.However, since the new product line has a unique appeal that will require substantial advertising by its manufacturer to gain consumer acceptance, there is a 47 percent chance that revenues for next year will be a modest 1.3 million. What is the expected level of revenues for the new product line?Problem 10Forecasting cash flows using the expected valuePeterson Trucking is contemplating the acquisition of Armour Transport, a competing trucking firm, and estimates that during the next year the cash flows from the Armour Transport acquisition will vary depending upon the state of the local economy:Problem 11 Financial ForecastingZapatera Enterprises is evaluating its financing requirements for the coming year. The firm has only been in business for one year, but its CFO predicts that the firm’s operating expenses, current assets, net fixed assets, and current liabilities will remain at their current proportion of sales. Last year Zapatera had $12.27 million in sales with net income of $1.24 million. The firm anticipates that next year’s sales will reach $14.56 million with net income rising to $2.13 million. Given its present high rate of growth, the firm retains all of its earnings to help defray the cost of new investments.The firm’s balance sheet for the year just ended is as followsEstimate Zapatera’s total financing requirements ( total assets) and its net funding requirements (discretionary financing needed) for 2014. Note: Use the percentage of sales given in Zapatera Enterprises’ balance sheet for 2013.Problem 12Related to Checkpoint 5.6Lance Murdock purchased a wooden statue of a Conquistador for $7,600 to put in his home office 7 years ago. Lance has recently married, and his home office is being converted into a sewing room. His new wife, who has far better taste than Lance, thinks the Conquistador is hideous and must go immediately. Lance decided to sell it on e-Bay and only received $5,200 for it, and so he took a loss on the investment. What was his rate of return, that is, the value of i?Problem 13-4Related to Checkpoint 13.3 Forecasting revenues using scenario analysisFloating Homes, Inc. is a manufacturer of luxury pontoon and house boats that sell for $40,000 to $100,000. To estimate its revenues for the following year, Floating Homes divides its boat sales into three categories based on selling price (high, medium, and low) and estimates the number of units it expects to sell under three different economic scenarios. These scenarios include a recession (Scenario Q, a continuation of current conditions in which the economy is level (Scenario IQ, and a strong economy (Scenario IIQ. These estimates are given here: Using these estimates, calculate the expected revenue for Floating Homes, Inc. for the following year.Problem 14Break-even analysisFarrington Enterprises owns a number of sporting goods businesses and is currently analyzing a new T-shirt printing business. Specifically, the company is evaluating the feasibility of this business based on its estimates of unit sales, the price per unit, variable cost per unit and fixed costs. The company’s initial estimates of annual sales and other critical variables are shown here:Problem 15The Marvel Mfg. Company is considering whether or not to construct a new robotic production facility. The cost of it is $582,000 and it’s expected to have a six year life with annual depreciation expense of $97,000 and no salvage value. Annual Sales from the new facility is expected 2,010 units with a price of $930 per unit. Variable production costs are $570 per unit while fixed cash expenses are $75,000 per yearProblem 16Review of financial statementsA scrambled list of accounts from the income statement and balance sheet of Belmond, Inc. is found here:Problem 17Corporate income taxMeyer Inc. bas taxable income (earnings before taxes) of $300,000 Calculate Meyers federal income tax liability using the tax table shown in the popup What are the firm’s and marginal tax rates?Problem 18Analyzing the quality of firm earningsKabutell, Inc. had net income of $750,000, cash flow from financing activities of $50,000, depreciation expenses of $50,000, and cash flow