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Case SolutionInput boxes in tanOutput boxes in yellowGiven data in blueCalculations in redAnswers in greenNOTE: Some functions used in these spreadsheets may requthe "Analysis ToolPak" or "Solver Add-in" be installed in ExcTo install these, click on "Tools|Add-Ins" and select "Analysiand "Solver Add-In."
2010 Income StatementSales$ 321,437 Cost of goods sold163,849 Selling & Administrative32,223 Depreciation46,255 EBIT$ 79,110 Interest10,056 EBT$ 69,054 Taxes13,811 Net income$ 55,243 Dividends$ 27,622 Addition to retained earnings$ 27,622 2011 Income StatementSales$ 391,810 Cost of goods sold206,886 Selling & Administrative42,058 Depreciation52,282 EBIT$ 90,584 Interest11,526 EBT$ 79,058 Taxes15,812 Net income$ 63,246 Dividends$ 31,623 Addition to retained earnings$ 31,623
Balance sheet as of Dec. 31, 2010Cash$ 23,643 Accounts payable $ 41,786 Accounts receivable16,753 Notes payable 19,046 Inventory32,255 Current liabilities $ 60,832 Current assets$ 72,651 Long-term debt $ 103,006 Net fixed assets$ 204,068 Owners' equity $ 112,881 Total assets$ 276,719 Total liab. & equity $ 276,719 Balance sheet as of Dec. 31, 2011Cash$ 35,721 Accounts payable $ 47,325 Accounts receivable21,732 Notes payable 20,796 Inventory43,381 Current liabilities $ 68,121 Current assets$ 100,834 Long-term debt $ 116,334 Net fixed assets$ 248,625 Owners' equity $ 165,004 Total assets$ 349,459 Total liab. & equity $ 349,459 20102011Operating cash flow$ 111,554 $ 127,054 Capital SpendingEnding net fixed assets$ 248,625
- Beginning net fixed assets204,068 + Depreciation52,282 Net capital spending$ 96,839 Change in Net Working CapitalEnding NWC$ 32,713 -Beginning NWC11,819 Change in NWC$ 20,894 Cash Flow from AssetsOperating cash flow$ 127,054 - Net capital spending96,839 -Change in NWC20,894 Cash flow from assets$ 9,321 Cash Flow to CreditorsInterest paid$ 11,526 -Net New Borrowing13,328 Cash flow to Creditors$ (1,802)Cash Flow to StockholdersDividends paid$ 31,623
-Net new equity raised20,500 Cash flow to Stockholders$ 11,123
Chapter 3 Ratios and Financial Planning at S&S AirInput area:Tax rate40%Sales$ 36,599,300 COGS26,669,496 Other expenses4,641,000 Depreciation1,640,200 EBIT$ 3,648,604 Interest573,200 Taxable income$ 3,075,404 Taxes (40%)1,230,162 Net income$ 1,845,242 Dividends$ 560,000 Add to RE$ 1,285,242 AssetsLiabilitiesCurrent AssetsCurrent LiabilitiesCash$ 396,900 Accounts PayableAccounts rec.637,560 Notes PayableInventory933,400 Total CLTotal CA$ 1,967,860 Long-term debtShareholder EquityFixed assetsCommon stockNet PP&E$ 15,411,620 Retained earningsTotal EquityTotal Assets$ 17,379,480 Total L&EOutput area:Current ratio0.71 Quick ratio0.37
Cash ratio0.14 Total asset turnover2.11 Inventory turnover28.57 Receivables turnover57.41 Total debt ratio0.45 Debt-equity ratio0.82 Equity multiplier1.82 Times interest earned6.37 Cash coverage ratio9.23 Profit margin5.04%Return on assets10.62%Return on equity19.31%