On January 1, 2017, Rama Corporation paid $150,000 for 30% of Samer Company's stock. Rama reported a net income of $25,000 in 2017, paid out $10,000 in dividends, and the annual amortization was $1,000 due to the undervaluation of the buildings (F.V> B.V). Rama uses the equity method. What is the balance of investment in Samer Company that will be reported on December 31, 2017?
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- Home Depot entered fiscal 2017 with a total capitalization of $21,904 million. In 2017, debt investors received interest income of $877 million. Net income to shareholders was $8,654 million. (Assume a tax rate of 21%.) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)Ayayai Company Limited reported the following for 2023: sales revenue, $1.16 million; cost of goods sold, $725, 000; selling and administrative expenses, $333, 000; gain on disposal of building, $283,000; and unrealized gain - OCI (related to FV- OCI equity investments with gains/losses not recycled), $17,000. Assume investments are accounted for as FV - OCI equity investments, with gains/losses not recycled through net income. Prepare a statement of comprehensive income. Ignore income tax and EPS.The data table shows financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $11.7 million at the end of 2016, and this equipment was depreciated by $3.9 million per year in 2017, 2018, and 2019. Given Mydeco‘s tax rate of 35%, what impact would this additional purchase have had on Mydecco’s net income in years 2016-2019? Assume that the equipment is paid for out of cash and that Mydeco earns no interest on its cash balances. In the table, calculate the new net income below. **round to one decimal place**
- Square Hammer Corporation shows the following information on its 2018 income statement: Sales = $196,000; Costs = $84,000; Other expenses = $5,100; Depreciation expense = $9,000; Interest expense = $13,300; Taxes = $29,610; Dividends = $10,300. In addition, you're told that the firm issued $7,100 in new equity during 2018 and redeemed $8,700 in outstanding long-term debt. a. What is the 2018 operating cash flow? Operating cash flow b. What is the 2018 cash flow to creditors? Cash flow to creditorsOn January 1,2018, Western Motors paid $450 million for a 40% investment in Yaza Motors. Yaza earned netincome of $65 million and declared and paid cash dividends of $45 million during 2018.1. What method should Western Motors use to account for the investment in Yaza? Give yourreason.2. Journalize these three transactions on the books of Western Motors. Show all amounts inmillions of dollars (rounded to the closest million), and include an explanation for eachentry.3. Post to the Equity-Method Investment T-account. What is its balance after all the transactions are posted?On January 1, 2016, a company's balance sheet reports its investments in debt securities as follows: Assets Investment in trading securities Investment in AFS securities Investment in HTM securities Equity Accumulated other comprehensive income: Unrealized gains (losses) on AFS securities Additional information: a. The HTM securities are $210,000 face value securities purchased on January 1, 2014, at a yield of 4%. The securities have a 4-year total life and pay interest annually on December 31, at a coupon rate of 6%. $165,000 95,000 217,922 $4,500 b. The trading securities on hand on January 1 were sold in 2016 for $185,000. c. More trading securities were purchased for $105,000. They are still on hand at December 31, 2016, and have a fair value of $120,000. d. AFS securities, originally purchased for $27,000 with a carrying value of $24,000 as of January 1, 2016, were sold for $32,000. e. AFS securities on hand at December 31, 2016, have a fair value of $85,000 $20,000 $15,000…
- Minear Company reported net income of $480,000 for the year ended 12/31/21. Included in the computation of net income were: depreciation expense, $60,000; amortization of a patent, $32,000; income from an investment in common stock of Brett Inc., accounted for under the equity method, $48,000; and amortization of a bond discount, $12,000. Minear also paid an $80,000 dividend during the year. The net cash provided by operating activities would be reported at $344,000. $424,000. $536,000. $456,000.a. Sales for 2018 were $455,150,000, and EBITDA was 15% of sales. Furthermore, depreciationand amortization were 11% of net fixed assets, interest was $8,575,000, thecorporate tax rate was 40%, and Laiho pays 40% of its net income as dividends. Giventhis information, construct the firm’s 2018 income statement.b. Construct the statement of stockholders’ equity for the year ending December 31, 2018,and the 2018 statement of cash flows.c. Calculate 2017 and 2018 net operating working capital (NOWC) and 2018 free cashflow (FCF). Assume the firm has no excess cash.d. If Laiho increased its dividend payout ratio, what effect would this have on corporatetaxes paid? What effect would this have on taxes paid by the company’s shareholders?e. Assume that the firm’s after-tax cost of capital is 10.5%. What is the firm’s 2018 EVA?f. Assume that the firm’s stock price is $22 per share and that at year-end 2018 the firmhas 10 million shares outstanding. What is the firm’s MVA at year-end 2018?Bonita Industries reported net income of $537000 for the year ended 12/31/21. Included in the computation of net income were: depreciation expense, $90100; amortization of a patent, $48500; income from an investment in common stock of Sandhill Co., accounted for under the equity method, $71400; and amortization of a bond premium, $18400. Bonita also paid a $123000 dividend during the year. The net cash provided by operating activities would be reported at $365500. $488500. $585800. $462800.
- Subject :- ADVANCED FINANCIAL ACCOUNTING (FIN611) Question # 2:XYZ Limited has the following loans outstanding as at December 31, 2020. Calculate the Capitalization RateLoan – A @ 8% (taken at January 01, 2020) Rs. 600,000Loan – B @ 5% (taken at July 01, 2020) Rs.400,000Loan – C @ 9% (taken at September, 01 2020) Rs.300,000The company spent following amounts on construction of an asset.March 01, 2020. Rs. 500,000August 01, 2020. Rs. 400,000December 1, 2020 Rs. 400,000 Note:- Solve these question and please explain in detail in such a way that i will get full marks.On December 31, 2017, PanTech Company invests $36,000 in SoftPlus, a variable interest entity. In contractual agreements completed on that date, PanTech established itself as the primary beneficiary of SoftPlus. Previously, PanTech had no equity interest in SoftPlus. Immediately after PanTech’s investment, SoftPlus presents the following balance sheet: Cash $ 36,000 Long-term debt $ 216,000 Marketing software 252,000 Noncontrolling interest 108,000 Computer equipment 72,000 PanTech equity interest 36,000 Total assets $ 360,000 Total liabilities and equity $ 360,000 Each of the above amounts represents an assessed fair value at December 31, 2017, except for the marketing software. Accordingly the December 31 fair value of SoftPlus is assessed at $144,000. If the marketing software was undervalued by $36,000, what amounts for SoftPlus would appear in PanTech's December 31, 2017, consolidated financial statements? If the marketing software…Complete the following table by putting the proper amount in each column: Assume that $100,000 was invested in each of the following classifications and the market value at the end of the year was $95,000. (For the Current Long term column indicate which classification is correct assuming there are no current maturities on long-term investments) Investment Type Carrying Value Current (C) or Long Term (LT) Adjustment To Income Adjustment to Other Comp Inc Debt Investment Trading Available-For-Sale Held-to-Maturity Equity Investment < 20% Ownership >21%,<50% Ownership