Forten company's current year income statement, comparative balance sheets, and additional information follow. for the year, (1) all sales are credit sales, (2) all credits to accounts receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to accounts payable reflect cash payments for inventory, and (5) other expenses are paid in advance and are initially debited to prepaid expenses forten company comparative balance sheets december 31 current year prior year assets cash accounts receivable inventory prepaid expenses total current assets equipment accum. depreciation-equipment total assets 66,400 82,380 292,156 1,320 442,256 146,500 $84,500 61,625 262,800 2,115 411,040 119,000 42,125) 51,500) $546, 631 $478,540 liabilities and equity accounts payable short-term notes payable total current liabilities long-term notes payable total liabilities equity common stock, $5 par value paid-in capital in excess of par, common stock retained earnings $131,175 64,141 13,300 77,441 139,375 59, 750 199,125 136,94.1 161,250 179,250 54,000 176,440 118,165 forten company income statement for current year ended december 31 sales cost of goods sold gross profit operating expenses $637,500 296,000 341,500 depreciation expense 31,750 143,400 175,150 other expenses other gains (losses) loss on sale of equipment income before taxes income taxes expense net income 16,125) 150,225 39,650 $110,575 additional information on current year transactions a. the loss on the cash sale of equipment was $16,125 (details in b) b. sold equipment costing $79,875, with accumulated depreciation of $41,125, for $22,625 cash c. purchased equipment costing $107,375 by paying $52,000 cash and signing a long term note payable for the balance d. borrowed $5,100 cash by signing a short-term note payable e. paid $55,625 cash to reduce the long-term notes payable f. issued 3,600 shares of common stock for $20 cash per share g. declared and paid cash dividends of $52,300 required: 1. prepare a complete statement of cash flows using the indirect method for the current year. (amounts to be deducted should be indicated with a minus sign.) forten company statement of cash flows for current year ended december 31 cash flows from operating activities adjustments to reconcile net income to net cash provided by operations: cash flows from investing activities 0 cash flows from financing activities: 0 0 net increase (decrease) in cash cash balance at december 31, prior year cash balance at december 31, current year 0

Sye chase started and operated a small family architectural firm in 2016. the firm was affected by two events: (1) chase provided $25,000 of services on account, and (2) he purchased $2,800 of supplies on account. there were $250 of supplies on hand as of december 31, 2016. record the two transactions in the accounts. record the required year-end adjusting entry to reflect the use of supplies and the required closing entries. post the entries in the t-accounts and prepare a post-closing trial balance.

Sabrina gupta, an investment advisor with a major brokerage firm, was examining wal-mart stores, inc. (wal-mart) stock and its valuation. gupta wondered whether to recommend the stock to any of her new clients or to existing clients who did not currently have wal-mart in their portfolios. her key task was to use an intrinsic value approach to price the shares and to then compare the resulting price with the price at which the stock was traded in the market. gupta wanted to use alternative valuation methods and assumptions to produce intrinsic value estimates for wal-mart stock. she was interested in seeing if the alternative methods would point to a consensus regarding the valuation of the stock and to see if the valuations suggested an investment opportunity given the current market price. methods she contemplated to use were: multi-stage growth modelprice earnings multiplemost valuation methods gupta considered required a common set of inputs: future cash flows to wal-mart investorsgrowth rate of future cash flowsdiscount factor or required rate of return by wal-mart investorsgupta gathered data to determine each of the above. gupta thought that dividends to wal-mart shareholders would adequately capture the cash flows to wal-mart shareholders; she also thought that this approach would simplify her task and she would revisit more complex valuation models if she felt the need. gupta thought that capm would provide her a relatively reliable estimate of the required rate of return. capm based required rate of return can be estimated by using a risk free rate, systematic risk of the firm and equity market risk premium. gupta thought that in a valuation exercise that involve long term cash flows, 10-year government bond yield would be an appropriate risk free rate of return estimate. she checked the 10 year note rate and found out that it was about 3.68%. gupta searched for wal-mart beta in bloomberg. bloomberg estimates betas by regressing the s& p 500 returns on the firm returns over the past two years and arrives at a “raw” beta estimate. bloomberg makes an adjustment in raw beta based on some academic research. gupta is confident that bloomberg adjustment is justified and she uses wal-mart beta estimate of 0.66 in her analysis. while gupta is aware of the importance of emrp assumption, she thinks that bloomberg’s historical estimate of 5.05% is a safe assumption. she is aware of the fact that some studies suggest a larger risk premium of approximately six per cent, while others suggest a much lower forward-looking premium of less than four per cent. she is mindful of the arbitrariness of her assumption, and she takes a note to revisit this issue if her valuations produce unreasonable estimates. anticipated dividend growth (g) is often estimated in a variety of ways. first, observed historical dividend growth can be assumed to continue in a perpetual fashion. second, future dividend growth can be estimated on the basis of recent estimates of analysts. gupta noted that the consensus annual wal-mart dividend for fiscal year 2011 was $1.21, and one respected analyst had estimated the expected constant dividend growth (in perpetuity) at approximately 3%.as the chart suggests, both earnings and dividend growth rates are declining but they seem to be higher than the “respected analyst’s” estimates. gupta decides to use several alternative perpetual growth assumptions to see the impact on price. since gupta decided to use variants of dividend discount model (ddm), she checked the anticipated earnings for 2011. analyst’s estimates suggested $4.10 earnings per share. gupta decided to use 10% growth rate from 2011 to 2012 and assumed a steady decline to 3% in 13 years (until 2024) where the perpetual growth rate of 3% resumes. she also assumed that walmart will increase its dividend payout ratio from 30% to 55% from years 2012 to 2024. you are asked to reproduce gupta’s analysis of multi-stage growth model and double check her valuation by using an earnings multiple. you have all the data you need to conduct the multi stage discounted growth model analysis, but you will need to do some research about the multiples valuation.

At fenway park, home of the boston red sox, seating is limited to 38,000. hence, the number of tickets issued is fixed at that figure. the following graph shows the demand and supply for red sox tickets. use the graph input tool to you answer the following questions. you will not be graded on any changes you make to this graph. 0 38 76 100 90 80 70 60 50 40 30 20 10 0 price of tickets quantity of tickets (thousands) demand supply graph input tool market for tickets price 10 quantity demanded (thousands of tickets) 68 quantity supplied (thousands of tickets) 38 tax on buyers 0.00 seeing a golden opportunity to raise revenue, the city of boston levies a per ticket tax of $5 to be paid by the ticket buyer. boston sports fans, a famously civic-minded lot, send in the $5 per ticket. true or false: the entire tax burden falls on the team’s owners because supply is perfectly inelastic. true false