Ahlam Company’s net income
Q1 (1.5 marks)
Ahlam Company’s net income for the year 2000, is $3,700,214. The company had an EBITDA of $ 10,125,300, and its depreciation and amortization expense was equal to $2,543,790. The company's average tax rate is 35 percent.
What is the amount of interest expenses for the firm? (Show the details of your calculations).
Prepare a common sized Income Statement if net sales equal $12,000,000
Q2. (1 Mark)
The following are accounts balance (in thousands) for Malak Company. Calculate Net Income after-tax (show intermediate steps) t=35% for the year ended December 31, 2020.
Net property and equipment
$ 2,000
Accounts receivable
$3,000
Notes payable
$37,000
Revenues
$ 983,000
Supply expenses
$ 255,000
Depreciation expenses
$ 35,000
Labor expense
$300,000
Interest Expenses
$11,000
Stockholders’ Equity
$61,500
Cash & cash equivalents
$97,000
Long-term debt
$3,500
Q3. Calculate the following ratios from the Balance Sheet and the Income Statement given below: (1.5 Mark)
Current Ratio
Debt Ratio
Fixed asset turnover
Total asset turnover
Operating profit margin
Balance Sheet:
Cash
30,000
Acct/Rec
72,500
Inventories
50,000
Current assets
152,500
Net fixed assets
240,000
Total assets
392,500
Accts/Pay
44,500
Accrued expenses
31,000
Short-term N/P
9,500
Current liabilities
85,000
Long-term debt
110,000
Owner's equity
197,500
Total liabilities and owners equity
392,500
Income Statement:
Net sales
450,000
COGS
220,000
Gross profit
230,000
Operating expenses
128,000
Net operating income
102,000
Interest expense
18,500
EBT
83,500
Income taxes
33,000
Net income
50,500
Q4. Using the values below, answer the questions that follow: (1mark)
Amount of annuity: $500
Interest rate: 9%
N=10 years
A) Calculate the future value of the annuity, assuming that it is
1/ An ordinary annuity.
2/ An annuity due.
B) Compare your findings in parts a(1) and a(2).
All else being identical, which type of annuity—ordinary or annuity due—is preferable as an investment? Explain why.
Sample Solution
Pakistan was deeply touched by the Turkey’s sympathetic attitude and President Ayub visited Turkey in December 1965 and met president Cemal Gursal. He expressed his deep gratiture to the Turkish President Gursal for the moral and material support of Turkish government provided to Pakistan during Indo-Pak war of 1965 and he also briefed him regarding the latest Indo-Pak situation. Turkey’s support for Pakistan’s efforts to seek a Kashmir solution continued to be expressed after the war ended and in all subsequent visits exchanged between the heads of state of the two countries, turkey reiterated its steadfast support to Pakistan on the Kashmir question. In October 1966, The Turkish Foreign Minister made an impassioned plea before the UN General Assembly for an early solution of the Kashmir problem in the light of the Security Council resolutions.
When the Indo-Pakistan war began in December 1971, the Turkish Premier, Nihat Erim, called for the immediate withdrawal of Indian troops. In June 1972, the President of Pakistan, Mr Zulfikar Ali Bhutto, paid a visit to Turkey. In a joint statement issued after his talks with the Turkish President Cevdet Sunay, the two leaders expressed the hope that the planned summit between the Pakistani President and the Indian Premier would lead a durable and honorable settlement of dispute between their two countries. On 4 October 1972, the Turkish Foreign Minister, in a speech before the UN General Assembly, made a strong plea for the release of Pakistani prisoners of war in India since December 1971 (Ali, 2001).