Question 1

Assume the following partially completed financial plan ($000): 
  The firm pays 8% interest on all of its debt and is subject to a 40% tax rate. Complete the plan.

Accepted Answer

The answer of Assume the following partially completed financial plan...

Question 2

The budgeting process involves:

Accepted Answer

The budgeting process involves predicting the amount of product needed along with the selling price of the product, estimating the amount that each department will spend on items such as salary and material, and determining which individuals will be tasked with ensuring the budget will be followed. Thus, option D, "All of the above," is the correct answer.

Question 3

Match between columns Premises: Hanson Manufacturing has the following revenues and collection pattern:
August September October November
Revenue $98,000 $102,800 $112,200 $111,900

Months After sale 1 2 3 4
Collection % 40% 30% 20% 10%

If the company offers a 2% prompt payment discount on all collections made in the first month, what are the cash collections for November?
Business planning spectrum Monterey Inc. has the following revenues and collection pattern:
March April May June
Revenue $12,000 $12,800 $12,200 $11,900

Months After sale 1 2 3
Collection % 50% 30% 20%

What are the cash collections for May?

Accepted Answer

The Answer of  $6,100 and  $108,884 and Planning is...

Question 4

Match between columns
                        Premises: Strategic planning

Accepted Answer

The Answer of Reflects more qualitatively than quantitatively the concepts is...

Question 5

Match between columns
                        Premises: Sustainable growth rate

Accepted Answer

The Answer of Reflects more qualitatively than quantitatively the concepts is...

Question 6

Which of the following is not one of the four types of business planning?

Accepted Answer

The four types of business planning are strategic planning, operational planning, financial planning, and contingency planning. Tax planning is not considered a separate type of planning, but rather is a part of financial planning. Short term forecasting can be considered a part of operational planning.

Question 7

Match between columns
                        Premises: Top-down planning

Accepted Answer

The Answer of Planning that tends to overstate achievable performance. is...

Question 8

Baxter Inc. is in a fast growing industry, but doesn't seem to be able to match its competitors' growth rates. Selected financial information for Baxter is as follows ($000): 
  Research has revealed that the average firm in Baxter's industry pays out 10% of its earnings in dividends, earns 4 cents after tax on every sales dollar, has an equity multiplier of 3.0 and a total asset turnover of 1.9. 
a. Use a sustainable growth rate analysis in the following table to determine the source(s)of Baxter's growth problems. 
  b. What negatives might be associated with fixing the problems revealed by the analysis?

Accepted Answer

The answer of Baxter Inc. is in a fast growing...

Question 9

Key Graphics expects to finish the current year with the financial results indicated on the worksheet given below. Develop next year's income statement and ending balance sheet using that information and the following planning assumptions and facts. Note that due to an economic slowdown, Key Graphics is expecting a ten percent reduction in revenue. It is attempting to cut expenditures by an even greater percentage, resulting in a larger net profit. Work to the nearest thousand dollars. PLANNING ASSUMPTIONS AND FACTS Income Statement Items 1.Revenue declines by 10%. 2.The cost ratio will improve by 3%. 3. Spending in the Marketing Department will be held to 22% of revenue. 4. Engineering and Overhead expenses will be cut by 15%. 5.The combined state and federal income tax rate will be 40% 6. Interest on all borrowing will be 9 percent. 7. Interest expenses are based on ¹/₂ of the prior year's long-term debt and ¹/₂ of the current year's long-term debt.) Balance Sheet Items 1.Cash balances will remain constant. 2. The ACP will be 30 days. (Use ending balances.) 3. The inventory turnover ratio will be 4 times. (Use ending balances.) 4. Capital spending is expected to be $6.0M. The average depreciation life of the assets to be acquired is 5 years and straight-line depreciation is used. Old assets will deprecation by $1,700,000. 5.Accounts payable is expected to be 40% of inventory. 6. Accruals will rise by $10,000 7.$1,500,000 of dividends will be paid. 8.There are no stock splits.

Accepted Answer

The answer of Key Graphics expects to finish the current...

Question 10

Short-term financing is particularly important with respect to the management of the cash inflow and outflow.

Accepted Answer

Short-term financing helps businesses to manage their cash flow by providing immediate access to funds to cover expenses or take advantage of opportunities, without having to wait for long-term financing to come through. This can be crucial for businesses that need to make investments or pay bills in a timely manner, and can help to avoid cash flow problems that can negatively impact operations.

Question 11

Small businesses usually create a single business plan that contains operating and strategic components.

Accepted Answer

Small businesses typically create a single business plan that outlines both their day-to-day operations and their long-term strategic goals.

Question 12

How have personal computers affected financial planning. Have they made planning something that anyone can do? Explain.

Accepted Answer

The answer of How have personal computers affected financial planning....

Question 13

A firm is planning to lower its ACP by ten days next year. Receivables are currently $15M on credit sales of $120M Credit sales are expected to grow by 20% next year. Calculate next year's ending receivables balance (make calculations using ending balances and a 360 day year).

Accepted Answer

The answer of A firm is planning to lower its...

Question 14

Payables are entirely due to inventory purchases at Cosmo Inc. COGS is 70% materials, and the company pays its bills in 50 days. This year's revenue is $1,000,000 and is forecast to grow by 15% next year. The cost ratio (COGS as a % of revenue)is planned at 40% next year. Forecast next year's ending payables balance.

Accepted Answer

The answer of Payables are entirely due to inventory purchases...

Question 15

The Winthrop Company expects to finish the current year with the financial results indicated on the worksheet on the next page. Develop next year's income statement and ending balance sheet using that information and the following planning assumptions and facts. Work to the nearest thousand dollars. 
 
 PLANNING ASSUMPTIONS and FACTS 
 Income Statement Items 
  Balance Sheet Items

Accepted Answer

The answer of The Winthrop Company expects to finish the...

Question 16

Tracy Corp. expects sales of $30,000, $36,000 and $40,000 for the months of January, February and March respectively. Historically, 60% of credit customers pay in the month of sale, 30% in the month following the month of sale, and 10% in the second month following sale. 
a. Forecast Tracy's March receipts if 100% of customers buy on credit. 
b. Forecast Tracy's March receipts if 80% of customers buy on credit and 20% pay cash.

Accepted Answer

The answer of Tracy Corp. expects sales of $30,000, $36,000...

Question 17

A partial financial plan for Blatt Inc. is shown below. Blatt pays 10% interest on all of its debt and is subject to a total effective tax rate of 50% 
  Complete the forecast developing consistent debt and interest figures for next year.

Accepted Answer

The answer of A partial financial plan for Blatt Inc....

Question 18

A firm is planning to increase its inventory turnover by 1.5 turns next year. This year's inventory is $40M on revenues of $850M. Revenues are planned to grow at 10% next year. The firm's cost ratio (COGS as a percent of sales)is 40%, and is not expected to change in the near future. Calculate the inventory figure that should be included in next year's plan. Calculate using the cost of goods sold (COGS)formulation of inventory turnover and using year-end balances only.

Accepted Answer

The answer of A firm is planning to increase its...

Question 19

Martin Inc. has the following financial data: ​  ​ What is Martin's sustainable growth rate?
​

Accepted Answer

The answer of Martin Inc. has the following financial data:...

Quiz 4: Financial Planning

Assume the following partially completed financial plan ($000): The firm pays 8% interest on all of its debt and is subject to a 40% tax rate. Complete the plan.

The budgeting process involves:

Match the following:

Match the following:

Match the following:

Which of the following is not one of the four types of business planning?

Match the following:

Short-term financing is particularly important with respect to the management of the cash inflow and outflow.

Small businesses usually create a single business plan that contains operating and strategic components.

How have personal computers affected financial planning. Have they made planning something that anyone can do? Explain.

A firm is planning to lower its ACP by ten days next year. Receivables are currently $15M on credit sales of $120M Credit sales are expected to grow by 20% next year. Calculate next year's ending receivables balance (make calculations using ending balances and a 360 day year).

A partial financial plan for Blatt Inc. is shown below. Blatt pays 10% interest on all of its debt and is subject to a total effective tax rate of 50% Complete the forecast developing consistent debt and interest figures for next year.

Martin Inc. has the following financial data: What is Martin's sustainable growth rate?

Quiz 4: Financial Planning

Assume the following partially completed financial plan ($000): The firm pays 8% interest on all of its debt and is subject to a 40% tax rate. Complete the plan.

The budgeting process involves:

Match the following:

Match the following:

Match the following:

Which of the following is not one of the four types of business planning?

Match the following:

Short-term financing is particularly important with respect to the management of the cash inflow and outflow.

Small businesses usually create a single business plan that contains operating and strategic components.

How have personal computers affected financial planning. Have they made planning something that anyone can do? Explain.

A firm is planning to lower its ACP by ten days next year. Receivables are currently $15M on credit sales of $120M Credit sales are expected to grow by 20% next year. Calculate next year's ending receivables balance (make calculations using ending balances and a 360 day year).

A partial financial plan for Blatt Inc. is shown below. Blatt pays 10% interest on all of its debt and is subject to a total effective tax rate of 50% Complete the forecast developing consistent debt and interest figures for next year.

Martin Inc. has the following financial data: ​ ​ What is Martin's sustainable growth rate? ​

Martin Inc. has the following financial data: What is Martin's sustainable growth rate?