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Davenport FINC510 Ch 02 P14 Build a Model and Ch 03 P15 Build a Model

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Question;Chapter 2. Ch 02 P14 Build a Modela. Cumberland Industries' most recent sales were $455,000,000;operating costs (excluding depreciation) were equal to 85% of sales, net;fixed assets were $67,000,000, depreciation amounted to 10% of net fixed;assets, interest expenses were $8,550,000, the state-plus-federal corporate;tax rate was 40% and Cumberland paid 25% of its net income out in;dividends. Given this information;construct Cumberland's income statement. Also calculate total dividends and;the addition to retained earnings.;The input information required for the problem is outlined in;the "Key Input Data" section below.;Using this data and the balance sheet above, we constructed the income;statement shown below.;Key Input Data for Cumberland Industries;2010;(Thousands of;dollars);Sales Revenue;$455,000;Expenses (excluding depreciation) as a percent of sales;85.0%;Net fixed assest;$67,000;Depr.;as a % of net fixed assets;10.0%;Tax rate;40.0%;Interest expense;$8,550;Dividend Payout Ratio;25%;Ch 03 P15 Build a ModelJoshua & White Technologies: December 31;Balance Sheets;(Thousands;of Dollars);Assets;2010;2009;Cash and cash equivalents;$21,000;$20,000;Short-term investments;3,759;3,240;Accounts Receivable;52,500;48,000;Inventories;84,000;56,000;Total current assets;$161,259;$127,240;Net fixed assets;218,400;200,000;Total assets;$379,659;$327,240;Liabilities and equity;Accounts payable;$33,600;$32,000;Accruals;12,600;12,000;Notes payable;19,929;6,480;Total current liabilities;$66,129;$50,480;Long-term debt;67,662;58,320;Total liabilities;$133,791;$108,800;Common stock;183,793;178,440;Retained Earnings;62,075;40,000;Total common equity;$245,868;$218,440;Total liabilities and equity;$379,659;$327,240;Joshua & White Technologies December 31 Income;Statements;(Thousands;of Dollars);2010;2009;Sales;$420,000;$400,000;Expenses;excluding depr. and amort.;327,600;320,000;EBITDA;$92,400;$80,000;Depreciation;and Amortization;19,660;18,000;EBIT;$72,740;$62,000;Interest;Expense;5,740;4,460;EBT;$67,000;$57,540;Taxes (40%);26,800;23,016;Net Income;$40,200;$34,524;Common;dividends;$18,125;$17,262;Addition;to retained earnings;$22,075;$17,262;Other Data;2010;2009;Year-end Stock Price;$100.00;$96.00;# of shares (Thousands);4,052;4,000;Lease payment (Thousands of Dollars);$20,000;$20,000;Sinking fund payment (Thousands of Dollars);$0;$0;Ratio Analysis;2010;2009;Industry Avg;Liquidity Ratios;Current Ratio;2.58;Quick Ratio;1.53;Asset Management Ratios;Inventory;Turnover;7.69;Days Sales;Outstanding;47.45;Fixed Assets;Turnover;2.04;Total Assets;Turnover;1.23;Debt Management Ratios;Debt Ratio;32.1%;Times-interest-earned ratio;15.33;EBITDA coverage;ratio;4.18;Profitability Ratios;Profit Margin;8.86%;Basic Earning;Power;19.48%;Return on Assets;10.93%;Return on Equity;16.10%;Market Value Ratios;Earnings per;share;NA;Price-to-earnings ratio;10.65;Cash flow per;share;NA;Price-to-cash;flow ratio;7.11;Book Value per;share;NA;Market-to-book;ratio;1.72

 

Paper#51295 | Written in 18-Jul-2015

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