1. Construct the cash flow statement for the year 2014
2. Compute the following financial ratios for the two years 2013, 2014
1. Total Asset Turnover
2. Fixed Asset Turnover
3. Inventory Turnover
4. Average collection period.
5. Current Ratio
6. Quick (Acid Test)
7. Cash ratio
8. Market-to-Book
9. P/E ratio
10. ROE
3. Decompose the ROE for the two years into:
Tax Burden, Interest Burden, Margin, Turnover, Leverage, Compound Leverage and ROA
Write a short note on the financial health of the company.
|
Income Statement
|
2012
|
2013
|
2014
|
|
Sales Revenues
|
|
110,000
|
140,000
|
|
COGS (including Depreciation)
|
|
44,000
|
70,000
|
|
Depreciation
|
|
40,000
|
44,000
|
|
S&A Expenses
|
|
40,000
|
42,000
|
|
Operating Income
|
|
26,000
|
28,000
|
|
Interest Expense
|
|
18,000
|
25,000
|
|
Taxable Income
|
|
8,000
|
3,000
|
|
Income Tax (40%)
|
|
3,200
|
1,200
|
|
Net Income
|
|
4,800
|
1,800
|
|
|
|
|
|
Balance Sheet
|
2007
|
2008
|
2009
|
|
Cash & MS
|
20,000
|
8,000
|
4,000
|
|
Accounts Receivable
|
30,000
|
36,000
|
40,000
|
|
Inventories
|
30,000
|
45,000
|
60,000
|
|
Net PPE
|
100,000
|
120,000
|
130,000
|
|
Total Assets
|
180,000
|
209,000
|
234,000
|
|
Liabilities
|
|
|
|
|
Accounts Payable
|
50,000
|
55,000
|
60,000
|
|
Short-term Debt
|
45,000
|
65,000
|
85,000
|
|
LT Debt (8% Bonds)
|
75,000
|
75,000
|
75,000
|
|
Total Liabilities
|
170,000
|
195,000
|
220,000
|
|
|
|
|
|
Shareholders Equity
|
10,000
|
14,000
|
14,000
|
|
|
|
|
|
Price per share
|
|
$ 80.00
|
$ 72.00
|
|
No of shares
|
10,000
|
10,000
|
10,000
|
|
Dividends Paid
|
|
800
|
1,800
|