juice asked in 科學數學 · 7 years ago


Consider the following abbreviated financial statements for Parrothead Enterprises:

a. What is owners’ equity for 2010 and 2011?

b. What is the change in net working capital for 2011?

c. In 2011, Parrothead Enterprises purchased $1,890 in new fixed assets. How much in fixed assets did Parrothead Enterprises sell? What is the cash flow from assets for the year? (The tax rate is 35 percent.)


1 Answer

  • 7 years ago
    Favorite Answer

    a. use balance sheet:Assets=Liabilities+Equites



    b. Net Working Capital=Current Assets-Current Liabilities

    2010:Net Working Capital=914-365=549

    2011:Net Working Capital=990-410=580

    change in Net Working Capital=580-549=31

    c. balance sheet:net fixed assets increase 4,536-3,767=769

    However, Parrothead Enterprises purchased 1,890 new fixed assets. So we can infer that some fixed assets had been sold, the amount is 1,890-769=1,121

    Cash flow from assets for 2011=EBIT*(1-T)+Depreciation-investment


    Source(s): me
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