Balance sheet and income statement, Financial Accounting

Assignment Help:

1) The detailed information is on the second tab marked "Financials". Enter summarized Balance Sheet and Income Statement information for Cummins into the template on the "Summary" tab for years 2008 to 2010. Use the field "All Other Items" for tying out the various financial sections. Be sure to balance.

2) Calculate the most recent two year CAGR (ie from 2008 to 2010) for all lines Remember that CAGR is the compound annual growth rate (ie that the growth from 2008 to 2010 would be the ((2010 figure/2008 figure) ^0.5)-1

3) Forecast next two years (2011 and 2012) Balance Sheet and Income Statement by using 1.05X (i.e. 105%) of the calculated CAGR for each line in #2 (in other words, if the CAGR is 10%, 105% of CAGR would be 10.5% as your growth rates. Remember growth rates can be negative as well). Do not forecast the total lines, such as Total Assets or Net Income - calculate them from their forecasted component lines. Plug cash to make balance sheet balance after forecasting all other lines.

4) Calculate common sized income statement and common sized balance sheet where indicated

5) Calculate the following ratios for all 5 years: (be sure to use averages where applicable )

a. Cash ratio

b. Quick ratio

c. Current ratio

d. Debt to Equity

e. Days Receivables

f. Days Inventory

g. Days Payable

h. Net working capital

6) Calculate cash conversion cycle for 2008-2012 (discussed in class but also see pages 800-804 - also known as simply the Cash Cycle)

7) Using 2008 as baseline, how much additional cash is being used/has been freed up by 2010 (i.e. the difference in net working capital)

8) Using a cost of funds of 10%, what is the additional cost/benefit in 2010 versus 2008 from to the change in net working capital (ie, if you say that funding working capital costs them 10%, how much more are they paying in costs due to the additional working capital, or saving if there is less working capital)

9) Using 2010 interest expense and both ST and LT debt levels, what is the company's actual interest expense rate as a %? (note, this may be a low interest rate - big companies typically can take advantage of very low rates or have special financing on certain items).

10) If the company wanted to pay off all its Short-term and Long-term debt over a ten year period by making equal quarterly payments  at its current interest rate calculated in #9, what would be the size of those payments?


Related Discussions:- Balance sheet and income statement

Calculate operating cash flow , Question 1 The following information s...

Question 1 The following information should be used for questions #1 through #7: Jersies, Inc financial statement data.   2009 2010

Use net present value and payback period method, Given the following cash f...

Given the following cash flows for projects A and B:   Year      Project A   Project B     0       -100,000     -150,000   (Project Cost)     1         25,000

Cash budget, Beginning balance 24,000 cash Sales 250,000 Gross profit 45% o...

Beginning balance 24,000 cash Sales 250,000 Gross profit 45% of sales Accounts receivable increase by 24,000 Accounts payable increased by 51,000 Inventory increased by 98,000 Sell

Financial Management, QUESTION 4: Spanking Clean (Ltd) operate a number of...

QUESTION 4: Spanking Clean (Ltd) operate a number of car washes and auto valet services. The company has experienced a reasonable trading year. They are deciding whether to pay ou

.which of the following is true, 1.Which of the following is true? A. Land ...

1.Which of the following is true? A. Land is depreciated using the straight line depreciation method B. Land is amortized using the declining balance method C. Land is depleted usi

Partnership and sole trader, what are the advantage and disadvantage to mr ...

what are the advantage and disadvantage to mr fish, mr Lobster of forming a partnership rather than a close corporation or a company?

Activity cost drivers, Activity Cost Drivers An element of measurement...

Activity Cost Drivers An element of measurement for the stage (or quantity) of an activity that is performed within a business company.  Hence, a movement cost driver represen

One more interest payment, 1. What will be the value of every of these bond...

1. What will be the value of every of these bonds when the going rate of interest is 4%? Suppose that there is only one more interest payment to be made on Bond S. Round your answe

Financial management, What can a financial institution often do for a defic...

What can a financial institution often do for a deficit economic unit (DEU)that it would have difficulty doing for itself if the DEU were to deal directly with an SEU?

Dissolutions, DISSOLUTIONS A partnership may be dissolved due to variou...

DISSOLUTIONS A partnership may be dissolved due to various reasons which include: Poor trading that has led to losses A partner dying or leaving the firm The time

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd