Manager of an Islamic Investment Fund (TIF) has extracted the following financial information about Unique Fabric Inc.
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Manager of an Islamic Investment Fund (TIF) has extracted the following financial information about Unique Fabric Inc. (UFT), a hypothetical company, for financial screening of the company to invest in its stocks.
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Assets Liabilities Income Statement (Selected Items) Revenue: S103,762 Depreciation: S12,000 Current assets: Current liabilities: 1. Cash: $50,000 2. Receivables: $100,000 3. Marketable securities: $5,000 4. Time deposits: S7,000 5. Commercial papers: $4,000 1. Payables: $35,000 2. Marketable securities: $45,000 Operating income: $60,000 3. Short-term bank loans: $20,000 4. Notes payables: $8,000 5. Accruals: $5,000 Income received from treasury bonds:$3,014 Long-Term Assets: Long-Term liabilities: Income received from marketable securities $209 1. Plant, Property and Equipment: S150,000 2. Intangible assets: $50,000 3. Musharaka investments: $50,000 1. Long-Term debt (including lease): S60,000 2. Common Stock: $289,000 3. Preferred stock: $40,000 4. Paid in capital: $28,000 5. Retained carnings $70,000 Income received from Mudaraba investments: $4000 Preferred dividends: SI08 4. Mudarabah Investments: $25,000 5. Treasury bonds: S60,000 6. Others Islamic Investment: Interest from the time deposits: $507 NI: 521,000 Total Equity: $427,000 $99,000 Total Assets: $600,000 Total Liabilities and Owner's Equity: $600,000 Below are the set of AAOIFI rules applicable for financial screening of Shariah compliant asset selection. 1. (Total interest income + income from non-compliant activities) / total revenues < 5% 2. (Conventional debt / total assets) < 30% 3. (Cash+interest-bearing deposits)/total assets <30% 4. Accounts receivable / total assets <45% Is manager of IIF follows AAOIFI standards for financial screening, what will be the value of the first ratio in the above four ratios? Assets Liabilities Income Statement (Selected Items) Revenue: S103,762 Depreciation: S12,000 Current assets: Current liabilities: 1. Cash: $50,000 2. Receivables: $100,000 3. Marketable securities: $5,000 4. Time deposits: S7,000 5. Commercial papers: $4,000 1. Payables: $35,000 2. Marketable securities: $45,000 Operating income: $60,000 3. Short-term bank loans: $20,000 4. Notes payables: $8,000 5. Accruals: $5,000 Income received from treasury bonds:$3,014 Long-Term Assets: Long-Term liabilities: Income received from marketable securities $209 1. Plant, Property and Equipment: S150,000 2. Intangible assets: $50,000 3. Musharaka investments: $50,000 1. Long-Term debt (including lease): S60,000 2. Common Stock: $289,000 3. Preferred stock: $40,000 4. Paid in capital: $28,000 5. Retained carnings $70,000 Income received from Mudaraba investments: $4000 Preferred dividends: SI08 4. Mudarabah Investments: $25,000 5. Treasury bonds: S60,000 6. Others Islamic Investment: Interest from the time deposits: $507 NI: 521,000 Total Equity: $427,000 $99,000 Total Assets: $600,000 Total Liabilities and Owner's Equity: $600,000 Below are the set of AAOIFI rules applicable for financial screening of Shariah compliant asset selection. 1. (Total interest income + income from non-compliant activities) / total revenues < 5% 2. (Conventional debt / total assets) < 30% 3. (Cash+interest-bearing deposits)/total assets <30% 4. Accounts receivable / total assets <45% Is manager of IIF follows AAOIFI standards for financial screening, what will be the value of the first ratio in the above four ratios?
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