Personal Finance (MindTap Course List)
13th Edition
ISBN: 9781337099752
Author: E. Thomas Garman, Raymond Forgue
Publisher: Cengage Learning
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Textbook Question
Chapter 3, Problem 3DTM
Ratio Analyses. Now that Jennifer better understands her situation she wants to do some analysis of what she has found. Given her balance sheet and cash-flow statements calculate the following ratios:
- Liquidity ratio
- Asset-to-debt ratio
- Debt-to-income ratio
- Debt payments-to-disposable income ratio
- Investment assets-to-total assets ratio
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Page 6
Using balance sheet information, the ____ ratio indicates your ability to meet current debt payments.
Group of answer choices
savings
liquidity
cash
debt service
solvency
Using the data in the picture, compute the following: Current cash debt coverage and Free Cash Flow
Chapter 3 Solutions
Personal Finance (MindTap Course List)
Ch. 3.1 - Prob. 1CCCh. 3.1 - What is the biggest financial worry of most...Ch. 3.1 - Prob. 3CCCh. 3.1 - Prob. 4CCCh. 3.2 - Prob. 1CCCh. 3.2 - Prob. 2CCCh. 3.2 - Prob. 3CCCh. 3.2 - Prob. 4CCCh. 3.2 - Which two financial ratios for evaluating...Ch. 3.3 - Prob. 1CC
Ch. 3.3 - Prob. 2CCCh. 3.4 - Prob. 1CCCh. 3.4 - Identify two money topics that you think might...Ch. 3.5 - Prob. 1CCCh. 3.5 - What are budget estimates? Offer some suggestions...Ch. 3.5 - How might one go about revising budget estimates...Ch. 3.5 - Prob. 4CCCh. 3.5 - Name different ways to handle budget variances.Ch. 3 - Prob. 1DTMCh. 3 - Calculating Net Worth and Net Surplus. Jennifer...Ch. 3 - Ratio Analyses. Now that Jennifer better...Ch. 3 - Prob. 4DTMCh. 3 - Prob. 5DTMCh. 3 - Prob. 6DTMCh. 3 - Prob. 1FPCCh. 3 - Prob. 2FPCCh. 3 - Prob. 3FPCCh. 3 - Prob. 4FPCCh. 3 - Prob. 5FPCCh. 3 - Prob. 1BYOPFMCh. 3 - Prob. 4BYOPFMCh. 3 - Prob. 5BYOPFMCh. 3 - Prob. 7BYOPFMCh. 3 - Prob. 10BYOPFMCh. 3 - Prob. 11BYOPFM
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- CHAPTER 2 ASSIGNMENT Your client is having trouble figuring out where all her money goes each month. Here is her financial information for you to review: $355* STOCKS IN BROKERAGE ACCT $5,500 MASTER CARD BILL $245* MONTHLY PAYCHECK (GROSS) $3,000 PAYROLL TAX WITHHELD $ 600 MONTHLY MORTGAGE PAYMENT $530 MUTUAL FUNDS $2,100 401(K) RETIREMENT ACCT $4,500 $265 $275* SAVINGS ACCT BALANCE $2,300 MONTHLY CLOTHING EXPENSES $45 MONTHLY VISA BILL MONTHLY CAR PAYMENT MONTHLY UTILITY BILL CHECKING ACCOUNT BALANCE QUARTERLY AUTO INSURANCE (NOT YET DUE) ANTIQUE COIN COLLECTION CONDOMINIUM MONTHLY GROCERIES AUTOMOBILE FURNITURE MORTGAGE BALANCE AUTO LOAN BALANCE OTHER PERSONAL PROPERTY OTHER MONTHLY CASH EXPENSES ANNUAL MEDICAL EXPENSES *Bills represent the average of the prior month's charges AND ALSO current month's expenses. $825 $450 $3,250 $65,000 $225 $9,000 $5,500 $50,000 $4,225 $8,000 $150 $264arrow_forwardDiscuss and explain how using debt ratios applies to your personal finances.arrow_forwardDiscuss the important of financial market, then illustrate with a diagram the flowof funds from lenders to borrowers in a financial system.arrow_forward
- What findings can you give about these FINANCIAL PROJECTIONS below. (Feasibilty Study)arrow_forwardDo the balance sheet, income statement, and statement of cash flows provide all of the information that a prospective lender or investor could require? What more facts do you want to look into?arrow_forwardThis section outlines the projected financial statements. The financial statements should include detailed notes/explanations and assumptions to substantiate your projections. Imaginary numbers can be used in the statement Key assumptions Provide the mentioned Financial statements Income statement Balance sheet Cash flow statement Break-even analysisarrow_forward
- Describe how you would do a financial analysis (refer to trends and ratios)arrow_forwardDo the balance sheet, income statement, and statement of cash flows contain all the information you might want as a potential lender or investor? What other information would you like to examine?arrow_forwardIllustrate with a diagram the flow of funds from lenders to borrowers in a financial system. Diagram must include: Savers Borrowers Financial markets Function of the financial intermediaries Function of the financial markets Direct finance Indirect financearrow_forward
- Investigate and evaluate the current literature to determine the relative value of the income statement against the flow of cash statement in the financial statement. When it comes to financial reporting, why are investors drawn to the income statement and cash flow statement?arrow_forwardWhen calculating free cash flow using balance sheet and income statement why do we add back after-tax interest on debt?arrow_forwardWhen deducing cash flow numbers, which of the following refers to a reflection of value? Select an answer: accounts receivable wage expenses accounts payable income statementarrow_forward
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