Module 1 Quiz + HW

United Company's year-end balance sheet reported the following (in millions):

Total Assets: $100,228
Total Liabilities: $78,713
Contributed Capital: $8,933

What was United Company's total liabilities and stockholders' equity at December 31?

$100,228 million

On December 31, Starstruck Corporation reported, on its balance sheet, the following (in millions):

Total Assets: $35,823.8
Total Stockholders' Equity: $14,726.8
Total Current Liabilities: $11,367.3

What did Starstruck report as total liabilities on December 31?

$21,097.0 million

Income statement—Numerical calculations required

On September 30, Star Corporation reported, in its annual report, the following (in millions):

Year 1:

Total Expenses: $41,008.5

Operating Income: $9,002.5

Net Earnings: $6,898.3

Year 2:

Total Expenses: $46,242.5

Operating Income: $10,429.8

Net Earnings: $7,047.3

What amount of revenues did Star Corporation report for the year ended September 30, Year 2 (in millions)?

$53,289.8

On December 31, Sleek Corporation reported, on its annual report, the following (in millions):

Year 1:

Operating Income: $3,961.1

Net Earnings: $2,759.3

Year 2:

Operating Income: $4,589.1

Net Earnings: $3,100.8

Calculate year-over-year increase or (decrease) in net earnings, in percentage terms.

12.4%

Users of financial statements include:

Current shareholders
Company CEO
Banker
Equity analyst
Supplier

Match the financial statement users to the question they are most likely to ask.

What is the expected net income for next quarter?

Equity Analyst

Match the financial statement users to the question they are most likely to ask.

2. Will the company have enough cash to pay dividends?

Current Shareholders

Match the financial statement users to the question they are most likely to ask.

3. Has the company paid for inventory purchases promptly in the past?

Supplier

Match the financial statement users to the question they are most likely to ask.

4. Will there be sufficient profits and cash flow to pay bonuses?

Company CEO

Match the financial statement users to the question they are most likely to ask.

5. Will the company have enough cash to repay its loans?

Banker

Use the accounting equation to compute the missing financial amounts (Equity)

Hewlett-Packard

Assets: $106,882
Liabilities: $78,731
Equity:

$28,151

Use the accounting equation to compute the missing financial amounts (Liabilities)

General Mills

Assets: $21,712
Liabilities:
Equity: $5,307

$16,405

Use the accounting equation to compute the missing financial amounts (Assets)

Target

Assets:
Liabilities: $27,305
Equity: $12,957

$40,262

Determine the percentage of owner-financing for each company.

Hewlett-Packard
Assets: $106,882
Liabilities: $78,731
Equity: $28,151

26.34%

Determine the percentage of owner-financing for each company.

General Mills
Assets: $21,712
Liabilities: $16,405
Equity: $5,307

24.44%

Determine the percentage of owner-financing for each company.

Target
Assets: $40,262
Liabilities: $27,305
Equity: $12,957

32.18%

Which of these companies is the most owner-financed?

Target 32.18% Owner Financed

Which of these companies is the most nonowner-financed?

Gneral Mills 24.44%