Question One

The following balance sheet is given for Qatar National W.L.L for the year 2007 and 2007

Assets

31/12/2008

31/12/2007

Liabilities

Long-Term Assets(Fixed
Assets)
Land
Buildings
Machinery

$158,500
$100,000
$30,000

$140,300
$90,000
$25,000

Long-Term Liabilities

Accumulated Depreciation
Net Tangible Assets

($3,000)
$285,500

($3,500)
$251,800

Bank Loan Payable

Bank Lease Payable

$75,000

$68,000

Investments

Total Owners' Equity

Current Assets

Total Long-Term Liabilities

31/12/2008

31/12/2007

$338,500

$298,800

$30,000

$27,000

$60,000

$52,000

$90,000

$79,000

Current Liabilities

Cash

$45,000

$40,000

Long-Term Debt 1 Yr.

$12,000

$11,000

Marketable Securities

$65,000

$60,000

Lease Payable

$15,000

$14,000

Accounts Receivable

$85,000

$70,000

Accounts Payable

$13,000

$12,000

Deposit at the bank

$45,000

$40,000

Taxes Payable

$11,000

$10,000

Inventories

$85,000

$80,000

Accrued Expenses

$21,000

$20,000

$325,000

$290,000

Other Current Liabilities

$10,000

$9,000

Salary Payable

$90,000
$70,000

$82,000
$62,000

Total Current Assets

Advertising cost Payable

Total Assets

$685,500

$609,800

$15,000

$12,000

Interest payable
Total Current Liabilities

$257,000

$232,000

Total Liabilities

$685,500

$609,800

Required
1. Identify the sources of the finance available to a company in general (P1.1, M1)
2. Identify and analyse how the assets of Qatar National W.L.L have been financed for the year of
2007 and 2008. (P1.2, 1.3, M2, D1)

Question Two
The following balance sheet is given for the period of 2008 and 2009

Assets
Current assets:
Cash and marketable
securities
Accounts receivable
Inventory
Total
Fixed assets:
Gross plant and
equipment
Less: Depreciation
Net plant and
equipment
Other long-term assets
Total
Total assets

Lake of Egypt Marina, Inc.

Balance Sheet as of December 31, 2008and 2009
(in millions of dollars)
2008
2009
Liabilities & Equity

8.28
14.01
24.21
46.50

60.00
12.74

8.24
12.64
21.98
42.86

2008

2009

Current liabilities:
Accrued wages and
taxes
Accounts payable
Notes payable
Total

5.48
10.19
8.92
24.59

4.40
9.89
8.79
23.08

Long-term debt:

35.67

32.97

63.74
12.09

Stockholders equity:
Preferred stock (5 million shares) 0.63
0.55
Common stock and
47.26
51.65
paid-in surplus
8.28
7.14
6.24
5.49
(65 million shares)
53.50
57.14
Retained earnings
30.83
36.26
Total
39.74
43.95
100.00% 100.00% Total liabilities and equity
100.00% 100.00%

Required
1. Explain the Working Capital Management (P2.1, M2)
2. Identify the Net Working capital of the above company for the year of 2008 and 2009 (P2.3, M1,
D2)
3. Analyse the working capital in terms of liquidity, profitability and risk taking ability (P2.3, M2, D1)
Question Three

Required
1. Explain the importance of investment appraisal (P3.3)
2. Explain the available techniques to appraise an investment (P3.3)
3. Evaluate each technique from the investors point of view (P3.3, M1, D1)
4. Identify the Net Present Value of the above project (P3.3, M1)
Year

Cash Flow ()

Discount
Factor (5%)

Present Value
()
(CF x DF)

- 800,000

+56,000

+700,000

+150,000

+90,000

+210,000

6
Total

+250,000