CHRIS STRACHAN - CHRIS STRACHAN PROJECT 4:00 pm 6335 Final...

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CHRIS STRACHAN; PROJECT: 4:00 pm 6335 Final Exam-Spring 2009 Take Home Final Due (under my door or in my mailbox by 6 pm May 14 th UofH, INC. IS A FICTIONAL COMPANY. ACCORDINGLY, THERE IS NO OUTSIDE DATA ON THE COMPANY OR ITS PEERS, USE ONLY WHAT HAS BEEN PROVIDED (i.e. the UofH Inc. spreadsheet template) Work Alone (COMPLETELY ALONE) – No Group Work or Discussion (Any discussion or group work will be considered cheating and will be treated accordingly – no exceptions) Please include financial calculations and written answers where they are requested. 25 points Question #1 1. Construct a Cash Flow Statement for UofH Inc. Create a Historical Cash Flow Statement in 2007 and 2008. Then using data that is later in this case you will need to continue and create 3 years of projections including the Cash Flow Statement, Income Statement and Balance Sheet. 2. Fill in all the financial ratios for 2006 to 2008 on the template provided. (areas highlighted in blue) 25 points Question #2 1. The Bank will lend you 2.5x EBITDA for a rate of 7%, additionally they require that the company maintain a debt to book capital ratio of no more than 60%. Assume the Company wants to have $15 million in cash on hand at all times. Assume the company will refinance all existing debt at this rate. Based on the capital expenditures required for growth (opening new book stores), how should UofH Inc. fund that growth? Explain the capital structure you choose for the Company. The Company can issue equity at the current stock price of $15.00 per share. Create a 3 year projected financial statement
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