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    muhammad qasim
    Here are the steps to prepare a Balance Sheet from the given data: 1. Assets: - Land Rs. 25,000 - Building Rs. 125,000 - Cash Rs. 15,000 - Bank Rs. 17,000 - Accounts Receivable Rs. 15,000 - Total Assets Rs. 197,000 2. Liabilities: - Accounts Payable Rs. 30,000 - Note Payable Rs. 25,800 - Total Liabilities Rs. 55,800 3. Capital: - Amir's Capital = Total Assets - Total Liabilities = Rs. 197,000 - Rs. 55,800 = Rs. 141,200

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    Assignments Question

    Uploaded by

    muhammad qasim
    276 views8 pages
    Here are the steps to prepare a Balance Sheet from the given data: 1. Assets: - Land Rs. 25,000 - Building Rs. 125,000 - Cash Rs. 15,000 - Bank Rs. 17,000 - Accounts Receivable Rs. 15,000 - Total Assets Rs. 197,000 2. Liabilities: - Accounts Payable Rs. 30,000 - Note Payable Rs. 25,800 - Total Liabilities Rs. 55,800 3. Capital: - Amir's Capital = Total Assets - Total Liabilities = Rs. 197,000 - Rs. 55,800 = Rs. 141,200

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    Here are the steps to prepare a Balance Sheet from the given data: 1. Assets: - Land Rs. 25,000 - Building Rs. 125,000 - Cash Rs. 15,000 - Bank Rs. 17,000 - Accounts Receivable Rs. 15,000 - Total Assets Rs. 197,000 2. Liabilities: - Accounts Payable Rs. 30,000 - Note Payable Rs. 25,800 - Total Liabilities Rs. 55,800 3. Capital: - Amir's Capital = Total Assets - Total Liabilities = Rs. 197,000 - Rs. 55,800 = Rs. 141,200

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    276 views8 pages

    Assignments Question

    Uploaded by

    muhammad qasim
    Here are the steps to prepare a Balance Sheet from the given data: 1. Assets: - Land Rs. 25,000 - Building Rs. 125,000 - Cash Rs. 15,000 - Bank Rs. 17,000 - Accounts Receivable Rs. 15,000 - Total Assets Rs. 197,000 2. Liabilities: - Accounts Payable Rs. 30,000 - Note Payable Rs. 25,800 - Total Liabilities Rs. 55,800 3. Capital: - Amir's Capital = Total Assets - Total Liabilities = Rs. 197,000 - Rs. 55,800 = Rs. 141,200

    Copyright:

    © All Rights Reserved
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    of 8

    (ASSIGNMENT FOR FINANCIAL MANAGEMENT)

    20 Marks
    1. A 5-year bond with a coupon rate of 4% has a face value of $1000. What is the annual
    interest payment?

    2. A 3-year bond with 10% coupon rate and $1000 face value yield to maturity is 8%.
    Assuming annual coupon payment, calculate the price of the bond.

    3. A 10-year bond with 12.5% coupon rate and $1000 face value yield to maturity is 14.5%.
    Assuming annual coupon payment, calculate the price of the bond.

    4. A 10-year bond with 12.5% coupon rate and $1000 face value yield to maturity is 14.5%.
    Assuming semi annual coupon payment, calculate the price of the bond.

    5. A four-year bond has an 8% coupon rate and a face value of $1000. If the current price
    of the bond is $878.31, calculate current yield assuming annual interest payments.

    6. A five -year bond has an 8% coupon rate and a face value of $1000. If the current price
    of the bond is $1075, calculate current yield assuming annual interest payment.

    7. A twenty year bond is currently selling at $850 and current yield is 8%. What coupon
    rate offered by company?

    8. A twenty year bond is currently selling at $1250 and current yield is 8%. What coupon
    rate offered by company?

    9. A three-year bond has 8.0% coupon rate and face value of $1000. If the yield to
    maturity on the bond is10%, calculate the price of the bond assuming that the bond
    makes semi-annual coupon interest payments.

    10. A four-year bond has an 8% coupon rate and a face value of $1000. If the current price
    of the bond is $878.31, calculate the yield to maturity of the bond (assuming annual
    interest payments).

    11. A ten -year bond has an 10% coupon rate and a face value of $1000. If the current price
    of the bond is $1150, calculate the yield to maturity of the bond (assuming annual
    interest payments).

    12. A 9.3% annual coupon bond with a 10-year maturity and a $1,000 par value has a yield
    to maturity of 8%. Assuming that the yield curve is flat and doesn’t shift, calculate the
    holding period return you would achieve from buying the bond, holding it for one year
    only.

    13. Suppose you want to offer zero coupon bonds with a face value of $1,000 maturing in
    twenty years. If the yield to maturity (YTM) on the bond is 8.00%, what will the price of
    the bond offered by your company?

    14. Suppose you offer zero coupon bonds at $245 with a face value of $1,000 maturing in
    twenty years. If the yield to maturity (YTM) on the bond is 8.00%, what will the price of
    the bond after two years?

    15. A bond for J. Morris, Inc. a coupon rate of 6%. The yield to maturity is 7%. The bond has
    a remaining life of 20 years and makes semi-annual coupon payments? What is the
    present value of the bond’s face value?

    16. A bond for Firebird, Inc. has a coupon rate of 7%. The yield to maturity is 6.8%. The bond
    has a remaining life of 30 years and makes annual coupon payments? What is this
    bond’s current market value?

    17. A bond for J. Morris, Inc. a coupon rate of 6%. The yield to maturity is 7%. The bond has
    a remaining life of 20 years and makes semi-annual coupon payments? What is this
    bond’s current market value?

    18. A bond for Ballhawkers, Inc. has a coupon rate of 7%. The yield to maturity is 6.8%. The
    bond has a remaining life of 30 years and makes semi-annual coupon payments? What
    is this bond’s current market value?

    19. Delux company authorized capital is 500,000 shares of Rs.10 each. Following
    information provided on December 31, 2004.
    20.

    TITLE OF ACCOUNT DEBIT CREDIT


    Cash 120,000
    Account receivable 155,000
    Account payable 145,000
    Merchandise inventory 125,000
    Purchases 1500,000
    Paid up capital 1800,000
    Transportation 20,000
    Salaries expense 120,000
    Sales 1830,000
    Building 1800,000
    Auditor’s fee 70,000
    Furniture 50,000
    Retained earnings 225,000
    Fire insurance 10,000
    Utility expenses 30,000

    4000,000 4000,000

    Additional information:
    1. Merchandise Inventory ending Rs.140,000
    2. Provide depreciation on furniture 20% and building at 2%.
    3. Income tax 20%

    Required:
    a) Income Statement
    b) Balance Sheet
    21. Deluxe company authorized capital is 500,000 shares of Rs.10 each. Following
    information provided on December 31, 2004.

    TITLE OF ACCOUNT DEBIT CREDIT


    Cash 120,000
    Account receivable 155,000
    Account payable 145,000
    Merchandise inventory 125,000
    Purchases 1500,000
    Paid up capital 1800,000
    Transportation 20,000
    Salaries expense 120,000
    Sales 1830,000
    Building 1800,000
    Auditor’s fee 70,000
    Furniture 50,000
    Retained earnings 225,000
    Fire insurance 10,000
    Utility expenses 30,000
    4000,000 4000,000

    Additional information:
    4. Merchandise Inventory ending Rs.140,000
    5. Provide depreciation on furniture 20% and building at 1%.
    6. Income tax 20%

    Required:
    c) Income Statement
    d) Balance Sheet
    22. Afzal company provided information on December 31,2004.

    TITLE OF ACCOUNT DEBIT CREDIT


    Plant assets Rs.37,50,000
    Cash 100,000
    Account Receivable 162,500
    Merchandise Inventory-beg 62500
    Sales return 7000
    Purchases 12,45000
    Transportation in 20000
    Salaries expense 145000
    Prepaid advertising 20000
    Director’s fee 2,15000
    Sales revenue 18,75000
    Commission income 20000
    Accumulated depreciation 350000
    Retained earning 367500
    Paid up capital 25,00000
    10% debentures payable 500000
    Account payable 112500
    Purchases return 2000

    57,27,000 57,27,000

    Additional information:
    1. Merchandise Inventory-ending Rs.45,000
    2. Depreciation 10% on fixed assets
    3. Tax rate is 30%

    Required:
    a) Income Statement showing EBIT
    b) Balance Sheet
    23. Delux company authorized capital is 500,000 shares of Rs.10 each.
    Following information provided on December 31,2004.

    TITLE OF ACCOUNT DEBIT CREDIT


    Cash 120,000
    Account receivable 155,000
    Account payable 145,000
    Merchandise inventory 125,000
    Purchases 1500,000
    Paid up capital 1800,000
    Transportation 20,000
    Salaries expense 120,000
    Sales 1830,000
    Building 1800,000
    Auditor’s fee 70,000
    Furniture 50,000
    Retained earnings 225,000
    Fire insurance 10,000
    Utility expenses 30,000
    4000,000 4000,000

    Additional information:
    7. Merchandise Inventory ending Rs.140,000
    8. Provide depreciation on furniture 20% and building at 2%.
    9. Income tax 40%

    Required:
    e) Income Statement
    f) Balance Sheet
    24. Prepare Balance Sheet from the given data, but be careful, every item
    will not be appeared in Balance Sheet.

    Land 25000

    Building 125000

    A/c payable 30000

    Cash 15000

    Note payable 25800

    Sales 550000

    Office supplies 5000

    Bank 17000

    A/c receivable 15000

    Amir-capital ?

    Salaries payable 32500

    Short-term investment 58000

    Office salaries expense 12500

    Prepaid advertising 36000

    Commission revenue 256900


    Retirement Planning

    25. Your younger sister, Susie, will start college in five years. She has just informed your
    parents that she wants to go to Collegiate U., which will cost $ 8,000 per year for four years
    (assumed to come at the end of end year). Anticipating Susie’s ambitions, your parents
    started investing $ 1,000 per year five years ago and will continue to do so for five more
    years.

    How much more will your parents have to invest each year for the next five years to have
    the necessary funds for Susie’s education? Use 10 percent as the appropriate interest rate
    throughout this problem (for discounting or compounding).

    26. Retirement Savings. You believe you will need to have saved $500,000 by the time you
    retire in 40 years in order to live comfortably. If the interest rate is 6 percent per year, how
    much must you save each year to meet your retirement goal?

    27. Retirement Savings. How much would you need in the previous problem if you believe
    that you will inherit $100,000 in 10 years?

    28. retirement Savings. You believe you will spend $40,000 a year for 20 years once you
    retire in 40 years. If the interest rate is 6 percent per year, how much must you save
    each year until retirement to meet your retirement goal?

    29. retirement Planning. A couple thinking about retirement decide to put aside $3,000
    each year in a savings plan that earns 8 percent interest. In 5 years they will receive a
    gift of $10,000 that also can be invested.

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