Corporate Finance 2 - Description Actual Figure Percentage...

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Description Actual Figure Percentage Creek Enterprises Income Statement for the Year Ended December 31, 2014 Sales revenue ($35,000,000) $ 35,000,000 100.0% Less: Cost of goods sold $ 23,065,000 65.9% Gross profits $ 11,935,000 34.1% Less: Operating expenses Selling expense $ 4,445,000 12.7% General and administrative expenses $ 2,205,000 6.3% Lease expense $ 210,000 0.6% Depreciation expense $ 1,260,000 3.6% Total operating expense $ 8,120,000 23.2% Operating profits $ 3,815,000 10.9% Less: Interest expense $ 525,000 1.5% Net profits before taxes $ 3,290,000 9.4% Less: Taxes (rate=40%) $ 1,330,000 3.8% Net profits after taxes $ 1,960,000 5.6% Less: Preferred stock dividends $ 35,000 0.1% Earnings available for common stockholders $ 1,925,000 5.5% Sales dipped $5,000,000 from 2014 to 2015 Cost of Goods sold increased from 65.9% to 70%, could indicate rising input costs Gross profits fell from 34.1% to 30% in line with the rising COGs Operating expenses fell, most likely variable costs because of the drop in sales Intrest expense rose from 1.5% to 3.3%, perhaps the firm is taking on too much debt
Description Actual Figure Percentage Creek Enterprises Income Statement for the Year Ended December 31, 2015 Sales revenue ($30,000,000) $ 30,000,000 100.0% Less: Cost of goods sold $ 21,000,000 Err:508 Gross profits $ 9,000,000 Err:508 Less: Operating expenses Selling expense $ 3,000,000 Err:508 General and administrative expenses $ 1,800,000 6.0% Lease expense $ 200,000 0.7% Depreciation expense $ 1,000,000 3.3% Total operating expense $ 6,000,000 20.0% Operating profits $ 3,000,000 10.0% Less: Interest expense $ 1,000,000 3.3% Net profits before taxes $ 2,000,000 6.7% Less: Taxes (rate=40%) $ 800,000 2.7% Net profits after taxes $ 1,200,000 4.0% Less: Preferred stock dividends $ 100,000 0.3% Earnings available for common stockholders $ 1,100,000 3.7%
Red Queen Pro-Forma Income Statement 2016, Percent of Sales a.

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