Question

	2014	2015
Cost of goods sold	$3,670	$4,109
Cash	250	313
Depreciation	125	122
Interest expense	291	280
Current liabilities	717	1,051
Net fixed assets	4,006	4,123
Sales	5,831	6,423
Accounts receivable	1,092	1,162
Long-term debt	2,400	1,100
Inventory	1,495	1,521
New equity	0	250
Taxes	590	672

What is the amount of dividend paid in 2014?

What is the net income in 2015?

Answer 1

Dividend paid in 2014: $1155

Sales		5831
Cost of goods sold		3670
Gross profit		2161
Depreciation	125
Interest expense	291
Taxes	590	1006
Net income $		1155

New equity in 2014 should be net income less dividends. Since new equity is 0, entire net income for 2014 is paid as dividend. Hence, dividends paid in 2014 are $1155.

Net income in 2015: $1240

Sales		6423
Cost of goods sold		4109
Gross profit		2314
Depreciation	122
Interest expense	280
Taxes	672	1074
Net income $		1240