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Exhibit 2.1 Bushman, Inc. Balance Sheet as of De...

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Exhibit 2.1 Bushman, Inc. Balance Sheet as of December 31, 2008 (In 000s) 2008 Assets: Current Assets $153,975 Other Assets 3,950 Gross Fixed Assets 138,283 Less: Accumulated Depreciation 48,806 Net Fixed Assets $ 89,477 Total Assets $247,402 Liabilities and Stockholders? Equity: Current Liabilities $ 83,646 Current Maturity Long-Term Debt 5,500 Total Current Liabilities $ 89,146 Long-Term Debt 55,753 Stockholders? Equity Common Stock $1 Par 3,106 Retained Earnings 99,397 Total Stockholders? Equity $102,503 Total Liabilities and Stockholders? Equity $247,402 Exhibit 2.2 Bushman, Inc. Income Statement for the Years Ending December 31, 2008 (In 000s) 2008 Net Sales $508,843 Cost of Goods Sold 329,486 Gross Profit $179,357 Selling, Distribution, and Administrative 129,246 Research and Development 12,466 Income Before Interest and Taxes $ 37,645 Interest Expense 8,021 Income Before Taxes $ 29,624 Federal and State Income Taxes 11,790 Net Income After Taxes $ 17,834 Exhibit 2.3 Bushman, Inc. Percentage Composition of Capital Structures for Selected Manufacturers in the Systems and Copier Industries Long-Term Preferred Stockholders? Debt Stock Equity Gaylord Enterprises 30.5% 4.1% 65.4% CSW Corporation 24.9 0.0 75.1 Welston, Inc. 25.2 1.1 73.7 Consol Royal 25.0 0.0 75.0 International Office 12.0 6.3 81.7 Exhibit 2.4 Bushman, Inc. Breakdown of Long-Term Debt as of December 31, 2008 (In 000s) Interest Rate Due Date Amount Terms 10.5% 2017 $13,000 Sinking fund of at least $1 million per year. Prepayment allowed. 12.0% 2012 18,000 Sinking fund of $3 million per year. No Prepayment allowed. 11.5% 2020 10,753 No sinking fund. Payable in full by July 31, 2020. 11.0% 2016 14,000 Sinking fund payment of $1.5 million. Prepayment allowed. $55,753 _____________________________________________________________________________ NOTE: The long-term borrowing agreement contains a group of restrictions on additional funded debt, working capital, the payment of dividends, and the purchase of the company?s stock. As of December 31, 2008, the amount of retained earnings available for dividends under the most restrictive agreement was $15,000,000. Exhibit 2.5 Bushman, Inc. Selected Ratios for the Systems and Copier Manufacturers for the Following Calendar Periods 2005 2006 2007 2008 Liquidity: 1. Current Ratio 1.60 1.62 1.64 1.61 2. Acid Test 1.20 1.19 1.23 1.20 3. Current Assets/Total Assets 60.4% 61.7% 62.1% 62.3% Activity: 1. Receivables Turnover 7.31X 7.24X 7.43X 7.50X 2. COGS/Inventory 6.20X 6.22X 6.24X 6.27X 3. Net Sales/Net Working Capital 7.47X 8.01X 8.04X 8.00X 4. Net Sales/Total Assets 2.00X 2.04X 2.08X 2.10X Leverage: 1. Total Debt/Total Assets 56.3% 56.3% 57.1% 57.9% 2. Debt/Net Worth 1.34 1.64 1.52 1.48 3. EBIT/Interest 4.32 3.96 3.88 4.01 Profitability: 1. COGS/Net Sales 65.8% 65.3% 65.6% 65.7% 2. Operating Profit/Net Sales 6.9% 7.0% 7.1% 6.8% 3. Profit Before Taxes/Net Sales 5.6% 5.7% 5.8% 5.5% 4. Profit Before Taxes/Total Assets 12.3% 12.6% 12.9% 13.1% 5. Profit Before Taxes/Net Worth 24.3% 25.2% 26.1% 26.0% 1. Determine the earnings per share assuming the issued securities are as follows: (A) Debentures (B) Common Stock (C) A 50-50 mix of debentures and common stock Note: Prepare your answer with earnings before interest and taxes (EBIT) of $30,000,000; $50,000,000; and $70,000,000. Assume that $75,000,000 of securities will be issued and that the marginal tax rate is 40 percent. What is the cross-over or breakeven EBIT?

 

Paper#3757 | Written in 18-Jul-2015

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