财务管理双语课后练习答案.docx

财务管理双语部分课后练习答案2000$60,00010,0005,0001,000 = $22,000 - $21,000$76.0002-7 a. Calculation of gross income:SalaryDividend IncomeInterest Income (IBM bonds only)ST capital gainsGross Income (excluding LT capital gains)LT capital gains = $22,000 - $9,000 =13,000*LT Capital gains tax rate =20%.Not taxed: $10,000 interest on Florida municipal bondsCalculation of taxable income:$76,000(2,750)(5、000)$68250Gross IncomeExemptionDeductionsTaxable Income (excluding LT capital gains)Personal tax = Tax on taxable income (excluding LT capital gains) + LT capital gains tax= $14,138.5 + ($68,250 - $62,450)(0.31) + $13,000(0.2)=$14,138.5+ $1,798J + $2,600= $18,536.50b. Marginal tax rate = 31%.Average tax rate = $18,536.50/($ 68,250+$ 13,000)= 22.8%.c. After-tax returns:IBM = (0Jl)-(0.31)(0.11) =7.59%FLA = (0.09) - 0= 9.00%The Florida bonds provide a higher after-tax return.d. 9%= 11%(1 -T). Now solve for T:9%= 11%- 11%T11%T =2T =2/11 = 18.18%.At a tax rate less than 18.2 percent, Margaret would be better off holding 11 percent taxable bonds, but ata tax rate over 18.2 percent, she would be better off holding tax-exempt municipal bonds. Given ourprogressive tax rate system, it makes sense for wealthy people to hold tax-exempt bonds, but not for thosewith lower incomes and consequently lower tax rates.2-8 a.Salary and income:Donald's salaryInterest from bondsIncome from rental propertyAdjusted incomeExpenses, exemptions, and deductions:Exemptions = 2 X $2,750Interest on mortgages5Plumbing expenses0Total expenses and deductionsTaxable income$50,000.02,500.042,000.0 = $3,500 X 12 months$94.500.0$ 5,500.018,000.01,250.0$24.750.0$69,750.0Taxes = $6457.5 + ($69,750 - $43,050) x 0.28 = $13,933.50a We could have included Maryanne's salary in this section, but then we would have had to recognize theamount she earned as an expense associated with the rental property. Because the two items cancel eachother, we need not include them here. Also, we ignore employment taxes in this problem.b The amount of the interest and property taxes paid on both houses is tax deductible.c Only the plumbing expense associated with the rental property is tax deductible because it was incurredin the generation of business revenues. Such personal expenses are not deductible.b. Salary and income:Donald's salary$50,000.0Interest from bonds2,500.0Adjusted income$52,500.0Expenses, exemptions, and deductions:Exemptions = 2 X $2,750$ 5,500.0Interest on mortgages35J50.0Total expenses and deductions$10,850.0$41,650.0Taxable incomeTaxes = $0 + $41,650 X (0.15) = $6,247.50a Only the amount of interest and property taxes paid on the couple's residence is applicable.Expenses incurred to generate business income are tax deductible, but personal expenses are not. The costof fixing the plumbing in the rental house would be considered a business expense, but the cost of fixingthe plumbing in the Jefferson own house would be considered a personal expense.3-2 a.IndustryCampsey AverageCurrent assets _ $655,000Current liabilitie s - $330,000Accounts receivable _ $336,000Sales/360- $4,465.28Cost of goods sold _ $1,353,000Inventories $241,500Sales $1,607,500Total assets $947,500Net income _ $27,300-Safes - $1,607,500Net income _ $27,300Total assets $947,500Net income _ $27,300Common equity $361,000Total debt $586,500Total assets $947,5001.98x75.0 days5.60x1.70x1.7%2.9%7.6%61.9%2.0x35.0 days5.6x3.Ox1.2%3.6%9.0%60.0%b. For Campsey, ROA = PM x TA turnover = 1.7% x 1.7 = 2.9%.For the industry, ROA = 1.2% x 3.0 = 3.6%.c. Campsey's days sales outstanding is more than twice as long as the industry average, indicating that thefirm should tighten credit or enforce a more stringent collection policy. The total assets turnover ratio is wellbelow the industry average so sales should be increased, assets decreased, or both. While Campsey's profitmargin is higher than the industry average, its other profitability ratios are low compared to the industrynetincome should be higher given the amount of equity and assets. However, the company seems to be in anaverage liquidity position and financial leverage is similar to others in the industry.d. If 2005 represents a period of supernormal growth for Campsey, ratios based on this year will bedistorted and a comparison between them and industry averages will have little meaning. Potential investorswho look only at 2005 ratios will be misled, and a return to normal conditions in 2006 could hurt the firm'sstock price.3-4 a.Current assets _ $303Current liabilitie s $111FinnertyIndustryFurniture Average2.73x2.0xb.Debt = Debt _ $135ratio Totai assets $450Times interest _ EBIT _ $49.5earned Interest $4.5Inventory- Cost of goods sold _ $660turn