Insurance Net Gain

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• Call options on futures.

  What is the net gain or loss to DePaul after accounting for the premium paid for the option? Call options on futures. DePaul Insurance Company purchased a call option on an S&P500 futures contract. The option premium is quoted as $6.

• EPS: Simple Capital Structure

  On December 31, 2010, Bailey recorded net income of $300,000 before tax and exclusive of the gain.

• Economics and shareholders

  $2,000 1000 1000 Cost of Reinvestment $1500 0 1500 All reinvestment cost is borne by equity holders Net gain to stakeholders 500 1000 -500 Since the net gain to shareholders is negative they would not reinvest by issuing new equity to pay for the

• Horizontal and Vertical Analysis

  (25,000) - Interest revenue 75,000 50,000 Net income before interest and taxes $135,000 $135,750 Income taxes 40,000 40,250 Net income $95,000 $95,500 Dividends 38,000 38,000 Total retained earnings $57,000 $57,500 Retained earnings

• Financial accounting: statement of cash flows using direct method for Star Company together with a reconciliation schedule. Explanatory notes are provided for better understanding of the statement and particularly the reconciliation.

  cash flow from operating activities $ Net Income 58,850 Add Depreciation 40,500 Depreciation is a non cash item Less: Gain on sale of land (8,000) Non Cash Less: Gain on sale of short term investment (4,000) Non Cash Change in Accounts Receivable

• Cash Flow Statement and Balance Sheet Data

  Gain on Sale of Securities ($2,250) Gain on Sale of Equipment ($750) Net cash flows from operating activities ($750) Cash flows from investing activities: Sale of Securities $90,000 Sale of

• Preparation of balance sheet

  Cash includes the cash surrender value of a life insurance policy $9,400, and a bank overdraft of $2,500 has been deducted. 2.

• Income Statement for Tony Rich Inc: Irregular Items

  securities (57,000) This would be a part of income from continuing operations Gain on proceeds of life insurance policy ($110,000-46,000) 64,000 Error in computation of depreciation As computed $9,000 Corrected

• Income statement

  When its president died, the corporation realized $110,000 from an insurance policy. The cash surrender value of this policy had been carried on the books as an investment in the amount of $46,000 (the gain is nontaxable). 5.