Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Assignment
Use the following information for Questions 1 through 4:
Assume that you recently graduated and have just reported to work as an investment advisor at the one of the firms on Wall Street. You have been presented and asked to review the following Income Statement and Balance Sheets of one of the firm's clients. Your boss has developed the following set of questions you must answer.
Income Statements and Balance Sheet
Balance Sheet
2012
2013
2014
Cash
$9,000
$7,282
$14,000
Short-term investments
48,600
20,000
71,632
Accounts receivable
351,200
632,160
878,000
Inventories
715,200
1,287,360
1,716,480
Total current assets
$1,124,000
$1,946,802
$2,680,112
Gross fixed assets
491,000
1,202,950
1,220,000
Less: Accumulated depreciation
146,200
263,160
383,160
Net fixed assets
$344,800
$939,790
$836,840
Total assets
$1,468,800
$2,886,592
$3,516,952
Liabilities and Equity
Accounts payable
$145,600
$324,000
$359,800
Notes payable
200,000
720,000
300,000
Accruals
136,000
284,960
380,000
Total current liabilities
$481,600
$1,328,960
$1,039,800
Long-term debt
323,432
1,000,000
500,000
Common stock (100,000 shares)
460,000
1,680,936
Retained earnings
203,768
97,632
296,216
Total equity
$663,768
$557,632
$1,977,152
Total liabilities and equity
Income Statements
Sales
$3,432,000
$5,834,400
$7,035,600
Cost of goods sold except depr.
2,864,000
4,980,000
5,800,000
Depreciation and amortization
18,900
116,960
120,000
Other expenses
340,000
612,960
Total operating costs
$3,222,900
$5,816,960
$6,532,960
EBIT
$209,100
$17,440
$502,640
Interest expense
62,500
176,000
80,000
EBT
$146,600
($158,560)
$422,640
Taxes (40%)
58,640
-63,424
169,056
Net income
$87,960
($95,136)
$253,584
Other Data
Stock price
$8.50
$6.00
$12.17
Shares outstanding
100,000
250,000
EPS
$0.88
($0.95)
$1.104
DPS
$0.22
0.11
0.22
Tax rate
40%
Book value per share
$6.64
$5.58
$7.909
Lease payments
$40,000
Ratio Analysis
Industry Average
Current
2.3
1.5
2.7
Quick
0.8
0.5
1.0
Inventory turnover
4
6.1
Days sales outstanding
37.3
39.6
32.0
Fixed assets turnover
10
6.2
7.0
Total assets turnover
2
2.5
Debt ratio
35.60%
59.60%
32.0%
Liabilities-to-assets ratio
54.80%
80.70%
50.0%
TIE
3.3
0.1
EBITDA coverage
2.6
8.0
Profit margin
2.60%
-1.6%
3.6%
Basic earning power
14.20%
0.60%
17.8%
ROA
6.00%
-3.3%
9.0%
ROE
13.30%
-17.1%
17.9%
Price/Earnings (P/E)
9.7
-6.3
16.2
Price/Cash flow
8
27.5
7.6
Market/Book
1.3
1.1
2.9
1. What is the free cash flow for 2014?
2. Suppose Congress changed the tax laws so that Berndt's depreciation expenses doubled. No changes in operations occurred. What would happen to reported profit and to net cash flow?
3. Calculate the 2014 current and quick ratios based on the projected balance sheet and income statement data. What can you say about the company's liquidity position in 2013?
4. Use the extended DuPont equation to provide a summary and overview of company's financial condition as projected for 2014. What are the firm's major strengths and weaknesses?
During the last 5 years, you owned two (2) stocks that had the following yearly rates of return and calculate the arithmetic mean yearly rate of return for every stock.
If you earned a rate of return of 6% on your bond investments last year. During that time the inflation rate was 1.8%. What is your real rate of return?
As a financial analyst, you have been asked to analyze a firm. Your task is to make a recommendation as to whether or not to invest in this firm given the analysis you undertake.
Determining stock price of various scrips - What is the current price of the stock? What was the net price change for the date covered by the paper?
1. the most appropriate discount rate to use when applying a fcfe valuation model is the .required rate of return on
What are the sustainable growth rates for your subject company over the period that you studied? How do they compare with the actual growth rates that the company experienced over the period studied?
the following are balance sheets for the genatron manufacturing corporation for the years 2010 and 2011 balance
Cash in hand stood at $1,000. Debentures were paid off on 30 June of the following year with interest. Liquidator's expenses amounted to $3,804 and they were entitled to remuneration at 3% on the amount realized and 2% on the amount distributed to un..
the financial statements of the hershey company appear in appendix b following the financial statements for tootsie
computation of pv fv simple and effective interest rate.1. find the effective rate corresponding to 3 compounded
After Year 5, the company should grow at a constant rate of 8% per year. If the required return on stock is 15%, what is the value of the stock today?
Why do you think negative interest rates are being observed in the market. What recent events are making the interest rates to become negative - Calculate the z-spread for the bonds issued by Ford Motor Company available in the Excel Spreadsheet..
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd