Calculate current cash debt coverage ratio, Financial Management

Calculate Current cash debt coverage ratio:

Financial statements for Delta Company are presented below:

 

Delta Company

Balance Sheet

December 31, 2012

                        Assets                                                             Liabilities & Stockholders' Equity

Cash                                                        $ 40,000            Accounts payable                   $ 20,000

Accounts receivable (trade)                      35,000            Bonds payable                            50,000

Buildings and equipment                           150,000           Common stock                           65,000

Accumulated depreciation-                                            Retained earnings                         60,000

     buildings and equipment                       (50,000)                                                          $195,000

Patents                                                       20,000           

                                                               $195,000           

 

 

Delta Company

Statement of Cash Flows

For the Year Ended December 31, 2012

Cash flows from operating activities

         Net income                                                                                                                $60,000

         Adjustments to reconcile net income to net cash

              provided by operating activities:

                     Increase in accounts receivable (trade)                            $(16,000)

                     Increase in accounts payable                                                 8,000

                     Depreciation-buildings and equipment                               15,000

                     Gain on sale of equipment                                                     (6,000)

                     Amortization of patents                                                           2,000                  3,000

Net cash provided by operating activities                                                                             63,000

Cash flows from investing activities

         Sale of equipment                                                                             12,000

         Purchase of land                                                                              (25,000)

         Purchase of buildings and equipment                                            (48,000)

Net cash used by investing activities                                                                                   (61,000)

Cash flows from financing activities

         Payment of cash dividend                                                               (15,000)

         Sale of bonds                                                                                    30,000

Net cash provided by financing activities                                                                             15,000

Net increase in cash                                                                                                             17,000

Cash, January 1, 2012                                                                                                         23,000

Cash, December 31, 2012                                                                                                 $40,000

 

Additional Information:  Selected accounted balances on Jan 1, 2012 were as follows: 

         Bonds Payable on Jan 1, 2012                                                       $20,000

         Total Assets on Jan 1, 2012                                                           112,000

         Number of common shares outstanding all year                             30,000

         Net Sales for 2012                                                                        $150,000

Instructions: 

Calculate the following for Delta Company and show your work. (You may need to compute some of the numbers you need before you could calculate some of the ratios below).

a.   Current cash debt coverage ratio

b.   Cash debt coverage ratio

c.   Free cash flow

d.   Current ratio

e.   Profit margin on sales  

f.    Payout Ratio

g.   Debt to total assets

h.   Rate of return on assets

i.    Earnings per share

j.    Asset turnover

k.   Receivables turnover

Posted Date: 2/14/2013 5:53:07 AM | Location : United States







Related Discussions:- Calculate current cash debt coverage ratio, Assignment Help, Ask Question on Calculate current cash debt coverage ratio, Get Answer, Expert's Help, Calculate current cash debt coverage ratio Discussions

Write discussion on Calculate current cash debt coverage ratio
Your posts are moderated
Related Questions
Q. Conservative Approach of Financial Management? An exact matching plan may not be followed in practice. A firm may adopt a conservative approach in financing its current and

a) Product portfolio refers to the diversity of the different product lines produced by a business. In this case, Mattel's product portfolio includes: board games, toy cars, cuddly

Peak Inc. needs to order Canadian raw materials to use in its production process. The Canadian exporter typically invoices Peak in Canadian dollars. Assume that the current exchang

discuss the applicability of financial management in respect to poultry farming in uganda


I need report on Weighted Average Cost of Capital. Do you provide help in topic Weighted Average Cost of Capital? I need expert's assistance to solve my college assignment. Please

Explain learning outcomes of financial management By the end of this subject guide as well as having done the relevant readings and activities you should be able to

One of the most important objectives of statistical analysis is to get one single value that describes the characteristic of the entire mass of unwieldy

1. Your welfare depends on how much time you travel T and how much time you play P and is the product of the two, i.e.,  W = T * P (a) The total amount of time you have is 10 ho

Inventory is sometimes thought of as a necessary evil.  Explain. Inventory ties up funds and these funds aren't earning an unambiguous return.  Some inventory is habitually nec