Analyse wiggen aircraft suppliers ltd balance sheet

Assignment Help Financial Management

Reference no: EM131263942

Q1. Singa Aircraft Component Pte Ltd is a company marketing civil aircraft parts and components. Singa Aircraft completed the financial transactions shown in Table during 2014. (Note: All amounts shown are in million dollars.) Analyse the transactions and prepare the income statement for Singa Aircraft Components Ltd for the year 2014.

1	Sale of aircraft tires	$3.00
2	Staff salary & hours	$0.80
3	Sale of engine components	$6.10
4	Payments to supplier for aircraft tires	$1.80
5	Sale of aircraft materials	$4.10
6	Maintenance of warehouse	$1.20
7	Long term loan from shareholders	$2.50
8	Repayments of short term bank loan	$3.40
9	Payments of short term bank loan	$1.20
10	Payments of rental and lease	$0.80
11	Payments to supplier for aircraft materials	$2.80
12	Sale of delivery truck	$0.80
13	Payments to supplier for engine components	$3.90
14	Payments of utilities	$0.30
15	Payments of tax	$0.18
16	Marketing and Advertisement charges	$0.35

Using the financial statements, explain how you can evaluate if a company is in a Good position to pay off its liabilities.

The cash flows statement shows the details of cash generated from operating investing and financing activities. Develop a reason as to why it is not a healthy indication if most of the cash is generated from the company's investing activities.

Q2. Dragon Air's financial transactions during 2012 are shown in Table (Note that all amounts in million dollars.)

Net income	$25.85
Payments of dividends	$15.56
Depreciation expense	$6.87
Purchase of aircraft engines	$9.36
Purchase of tow trucks	$1.80
Sale of warehouse	$3.15
Issuance of common stock	$18.28
Payments of notes payable	$8.22

The balance sheet of Dragon Air reported the following for the years ending on 31 December 2012 & 2011:

2012 2011

Current Assets

Cash & cash equivalents $18.030 $ 7.760

Accounts receivable $ 6.870 $ 4,650

Inventories $ 11.230 $ 8,450

Current Liabilities

Accounts payable $ 5.880 $ 6.750

Accrued liabilities $ 9.030 $12.100

Develop the statement of cash flows of Dragon Air for the -3.fear enclitic, 31 Dec 2012 using the indirect method to report cash flows from operating activities. Use the template on Page 5 for preparing the cash flaws statement. Detach the sheet and attach it to -your answer book(s).

Q3. Wiggen Aircraft Suppliers. Ltd. financial statement for the year 2011 is as shown in Table

Net income	$49.00 mil
Depreciation Expense	$5.00 mil
Increase in accounts receivable	$2.00 mil
Decrease in inventories	$10.00 mil
Decrease in accounts payable	$4.00 mil

Using the indirect method, compute Wiggen's net cash flow from operating actinides.

(b) Consider the following income statement data from Wiggen Aircraft Suppliers Ltd for the years 2013 and 2012 and develop the Income Statements for the two years.

Amounts in million dollars	2013	2012
Sales	$64.00	$52.00
Cost of goods sold	$40.32	$31.72
Selling Expenses	$12.16	$10.40
General Expenses	$7.04	$6.76
Income Tax	$0.67	$0.51

(c) Analyse Wiggen Aircraft Suppliers Ltd balance sheet data shown in Table for the years 2013 and 2012. (Use financial ratios to Support your answer)

(i) Demonstrate Wiggen's ability in 2013 to meet its current liabilities.

(ii) Evaluate the resilience of the company to financial risks.

Amounts in million dollars	2013	2012
Current Assets	$45.00	$38.90
Total Assets	$238.85	$226.75
Current Liabilities	$38.98	$29.08
Long Term Debts	$37.04	$36.76
Total Liabilities	$152.60	$158.10
Total Equity	$86.25	$68.65

Q4. (i) Is the Operating Profit Margin of Super Jet Airlines in 2013 better than in 2012? Give TWO suggestions to further improve the company's Operating Profit Margin.

(ii) Evaluate Super Jet Airlines' ability to meet the company's near term liabilities during 2013. Use any TWO financial ratios To support your answer.

(iii) What does Super Jet Airlines balance sheet for 2013 indicate regarding the company's Long term solvency and vulnerability to financial risks? Apply the financial data in the balance sheet to support your answer.

Q5. Table shows the financial data of Wichita Aircraft Spares Ltd.

	2012 (million)	2011 (million)
Sales	$26.00	$20.85
Cost of Goods Sold	$10.00	$11.25
Advertisement & Promotions Expenses	$1.35	$2.20
Cost of Repairs to Warehouse	$3.45	$0.75
Rental Expenses	$2.85	$1.95
Interest Income	$2.05	$3.45
Tax	$2.15	$1.75

(a) Using the data in Table, demonstrate your ability to compute any two profitability ratios for the year 2012.

(b) Categories the following cash flows as to whether they are cash inflow or cash outflow activities and also whether they are operating, investing, or financing activities:

(i) Taxes paid

(ii) Dividends paid to shareholders

(iii) Interest paid on loans

(iv) Dividends received on investments

(v) Cash sales

(vi) Purchase of new equipment

(c) Table Q3(c) shows Wichita Aircraft Spares Ltd's Balance Sheet as of 31 December 2012. Using the data provided in Table Q3(c),

(i) Compute any two liquidity ratios for 2012; and

(ii) Evaluate if the company's liquidity has improved in 2012 compared to 2011.

Q6. The balance sheet of SR Aviation Systems for the year ending on 31 December 2011 & 2010 art shown a follows:

2011 2010

Current Assets

Cash & cash equivalents $104.160 $38,760

Accounts receivable $32,500 $39,200

Inventories $45,700 $36,800

Current Liabilities

Accounts payable $19,800 $17,800

Accrued liabilities $5,790 $7,690

SR Aviation's financial transactions during 2011 included the following:

Net income $125,000

Payment of dividends $28,800

Depreciation expense $18,000

Purchase of equipment $15,700

Purchase of warehouse $132,000

Payment of note payable $65,000

Issuance of comma stock $166,000

Develop the statement of cash flows of SR Aviation for the year eliding 31 Dec 2011 using the indirect method to report cash flows from operating activities. Use the attached Table to prepare the cash flows statement. Detach the sheet on Page 5 and attach it to your answer book.

Attachment:- Assignment.rar

Reference no: EM131263942

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