04 Chapter model

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04 Chapter model 10/4/2009 19:38 2/13/2006 Chapter 4. Analysis of Financial Statements INPUT DATA SECTION: Historical Data Used in the Analysis 2005 2004 Year-end stock price $23.00 $26.00 Shares outstanding (in millions) 50 50 Tax rate 40% 40% After-tax cost of capital 10.0% 10.3% Lease payments ($M) $28 $28 Principal payments ($M) $20 $20 COMMON SIZE BALANCE SHEETS - Allied Food Products - December 31 (in millions of dollars) COMMON SIZE 2005 2004 2005 2004 Assets Cash and equivalents $10 $80 0.50% 4.76% Accounts receivable 375 315 18.75% 18.75% Inventories 615 415 30.75% 24.70% Total current assets $1,000 $810 50.00% 48.21% Net plant and equipment 1,000 870 50.00% 51.79% Total assets $2,000 $1,680 100.00% 100.00% This spreadsheet model sets up common size balance sheets and income statements for Allied (2004 and 2005 statements) and conducts a full ratio analysis of Allied's financial statements. Common size balance sheets and income statements allow you to see the values of various financial statement accounts relative to total assets or sales, respectively. Common size statements are a good first look at financial statement analysis, which is extended by ratio analysis. A B C D E F G H 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
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Liabilities and equity Accounts payable $60 $30 3.00% 1.79% Notes payable 110 60 5.50% 3.57% Accruals 140 130 7.00% 7.74% Total current liabilities $310 $220 15.50% 13.10% Long-term bonds 750 580 37.50% 34.52% Total debt $1,060 $800 53.00% 47.62% 130 130 6.50% 7.74% Retained earnings 810 750 40.50% 44.64% Total common equity $940 $880 47.00% 52.38% Total liabilities and equity $2,000 $1,680 100.00% 100.00% INCOME STATEMENTS - Allied Food Products - Years Ending December 31 (in millions of dollars) COMMON SIZE 2005 2004 2005 2004 Net sales $3,000.0 $2,850.0 100.00% 100.00% Operating costs except depr'n 2,616.2 2,497.0 87.21% 87.61% EBITDA* $383.8 $353.0 12.79%
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This note was uploaded on 03/21/2010 for the course BUSINESS AB102 taught by Professor Woo during the Spring '10 term at Nanzan.

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