Business Finance I

FINC 303 / 2101

Fall 2022

Assignment 2

Assignment rules:

1) All your answers, discussions, interpretations should be detailed by your

own words (coping and pasting is prohibited).

2) No Emails/Questions on the assignment during the assignment period.

If you doubt in a question, you are invited to write your concern in the answer

sheet.

3) The due date of this assignment is (Monday 17/10/2022) at 11:59 pm. Each

minute of delay will affect the grade.

4) Assignments to be submitted to Blackboard and the file should be named

with your name and University ID.

Given the following financial statements for Maple Landmark Company.
Maple Landmark Company
Comparative Balance Sheet
At December 31, 2021
Assets 2021 2020
Cash EGP110,200 33,400
Accounts Receivables 60,800 37,000
Inventories 119,900 102,650
Land 84,500 107,000
Plant Assets 315,000 205,000
Accumulated depreciation (52,000) (42,000)
Total assets 640,400 445,050

Liabilities and Stockholders' equity

Accounts payable 52,700 48,280
Accrued expenses payable 15,100 18,830
Bonds payable 150,000 70,000
Common stock 250,000 200,000
Retained earnings 172,600 107,940
Total liabilities and stockholders' equity 640,400 445,050

Maple Landmark Company

Income statement
For the year ended, December 31, 2021
Sales EGP 297,500
Cost of goods sold (99,460)
Gross profit 198,040
Operating expenses ( 43,110)
Operating income before interest and tax 154,930
Interest expenses (10,000)
Gain on sale of plant assets 5,000
Income before tax expense 149,930
Tax expense (Tax rate = 24.86%) (37,270)
Net income 112,660

Additional information:
1. Operating expenses including depreciation expense of EGP40,000
2. New plant assets costing EGP150, 000 were purchased for cash during the year.
3. Land was sold at cost for cash.
4. Plant assets costing EGP40, 000 with book value of EGP 10,000 were sold for EGP15, 000.
5. A cash dividend of EGP 48,000 was declared and paid during the year.
6. Bonds with EGP80, 000 face value were issued for cash.
 7. The company issued common stock for EGP50, 000 for cash.
Required:

a) Prepare the cash flow statement for Maple Landmark Company for the year ended
December 31, 2021 (Using the indirect method).
b) Calculate the Maple Landmark Company’s Free Cash Flow (FCF) for the year ended
December 31, 2021?
c) What are the five uses of FCF?