ALPHA COLLEGE OF TECHNOLOGY – ACT

UNIVERSITI UTARA MALAYSIA

FIRST SEMESTER 2011/2012

BWFF 2013 FINANCIAL MANAGEMENT I

Tutorial 1: Chapter 2 (Understanding Financial Statements)

1. The income statement represents a snapshot of account balances at one point in time.
True or not? Why? (Concepts of Balance Sheet and Income Statement)

2. Your firm has the following income statement items: sales of RM 50,250,000; income
tax of RM 1,744,000; operating expenses of RM 10,115,000; cost of goods sold of
RM 35,025,000; and interest expense of RM 750,000. What is the amount of the
firm’s EBIT? (Financial Statements, Cash Flows and Taxes)

3. Pearls, Inc. has the following balance sheet statement items: total current liabilities of
RM 805,000; total assets of RM 2,655,000; fixed and other assets of RM 1,770,000;
and long-term debt of RM 200,000. What is the amount of the firm’s net working
capital? (Financial Statements, Cash Flows and Taxes)