FIN 380 ASU Online QUIZ 1 FIN Stmts Solutions FALL 2021B PDF

Preview

Summary

sylabus...

Description

FIN 380 ASU ONLINE QUIZ 1 FINANCIAL STATEMENTS SOLUTIONS **These solutions are the property of David Hoffman and ASU and may not be copied and/or posted online.**

1. QUESTIONS 1 - 3 GO WITH THE FOLLOWING: Terry Dactal has compiled the financial information displayed below. Which of the following is Terry’s net worth? Salaries

$72,400

Credit Card Balance

$8,600

Cash on Hand

$1,500

Utilities paid to date

$8,450

Coin Collection

$2,350

Jewelry value

$8,500

Home value

$335,000

Auto loan balance

$14,300

Stock Portfolio value

$18,500

1967 Ford Mustang value

$40,900

Grocery Expenses

$7,550

Checking account

$3,200

Mortgage Balance

$178,600

Property Taxes owed

$1,750

Mortgage loan payments made

$19,500

Student loan balance

$22,600

New York vacation expenses paid

$4,200

Auto loan payments paid

$6,000

Income taxes paid-to-date

$7,100

Clothing/entertainment expense

$4,000

Interest earned

$400

Insurance premiums paid

$5,500

Assets 1,500 2,350 335,000 18,500 8,500 40,900 3,200

Liabilities 178,600 8,600 14,300 1,750 22,600

Income 72,400 400

409,950

225,850

72,800

1.

Net worth is 409,950 – 225,850 = $184,100

2.

Cash Surplus is 72,800 – 62,300 = $10,500

Expenses 7,550 19,500 4,200 7,100 8,450 6,000 4,000 5,500 62,300

3. If Terry had a solvency ratio of 42% the previous year, which of the following statements is correct? Solvency Ratio is 184,100/409,950 = 45% which is a slight improvement from the previous year of 42%. 4. This year Bob Katz had a debt service ratio of 21% compared to a value of 19% the year before. Which of the following statements is correct? The lower the number the better so 21% is a slight decline from the previous year of 19%. 5. The difference between a liability and an expense is that a liability is something that has been paid and an expense is something that has not been paid. False, just the opposite: a liability has not been paid and an expense has been paid. **These solutions are the property of David Hoffman and ASU and may not be copied and/or posted online.**...