Study guide course part 3 - Running head[SHORTENED TITLE UP...

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Running head: [SHORTENED TITLE UP TO 50 CHARACTERS] 1 [Title Here, up to 12 Words, on One to Two Lines] [Author Name(s), First M. Last, Omit Titles and Degrees] [Institutional Affiliation(s)] Author Note [Include any grant/funding information and a complete correspondence address.]
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[SHORTENED TITLE UP TO 50 CHARACTERS] 2 The Florida Tech Company is a large manufacturer and distributor of electronic components. Because of some successful new products marketed to manufacturers of computes and mobile electronic devises, the firm has recently undergone a period of explosive growth, more than doubling its revenues during the last two years. However, the growth has been accompanied by a marked decline in profitability and a precipitous drop in the company’s stock price. Analyze the company’s performance and find out what is going wrong. Begin by analyzing the firm’s financial statements over the last three years, which are shown below. FLORIDA TECH COMPANY INCOME STATEMENTS For The Periods ended 12/31 (000,000) 2011 2012 2013 Sales $1,578 $2,106 $3,265 COGS 631 906 1,502 Gross Margin $ 947 $1,200 $1,763 Expenses Marketing $316 $495 $882 R & D 158 211 327 Admin. 126 179 294 Total Expenses $ 600 $ 885 $1,503 EBIT $347 $315 $260 Interest 63 95 143 EBT $284 $220 $117 Tax 97 75 40 EAT $187 $145 $ 77 FLORIDA TECH COMPANY BALANCE SHEETS
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[SHORTENED TITLE UP TO 50 CHARACTERS] 3 12/31 ($000,000) 2011 2012 2013 ASSETS Cash $ 30 $ 40 $ 62 Accounts Receivable 175 351 590 Inventory 90 151 300 Current Assets $ 295 $ 542 $ 952 Fixed Assets Gross $1,565 $2,373 $2,718 Accum. Depreciation (610) (860) (1,135) Net $ 955 $1,513 $1,583 Total Assets $1,250 $2,055 $2,535 LIABILITIES Accounts Payable $56 $81 $134 Accruals 15 20 30 Current Liabilities $71 $101 $164 Capital Long-Term Debt $630 $1,260 $1,600 Equity 549 694 771 Total Liab. & Equity $1,250 $2,055 $2,535 The following additional information is provided with the financial statements. Depreciation for 2011, 2012, and 2013 was $200, $250, and $275 million respectively. No stock was sold or repurchased, and like many fast growing companies, Florida Tech paid no dividends.
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