Case 3 and 4 COF1 revised

Case 3 and 4 COF1 - Martin Manufacturing Company Pro forma Income Statement 2010 Data Item Sales revenu less COGS Gross Profits Less Operating

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Ma Pro forma Income Statement 2010 Pr Data Item Value Assets CA Sales revenu 6500 less: COGS 4745 Gross Profits 1755 Less: Operating expenses Selling exp 832 Gross FA 533 Less: Accum. De Depreciation exp 185 Net FA Total 1550 Total Assets Operating profits 205 Less: Interest expense 97 Liabilities and S Net profits before taxes 108 CL Less: Taxes (40%) 43 Net profts after taxes 65 Less: Preffered and common dividend payments 20 Earnings available for common Stockholders 45 Long-term Debt Total Liabilities Stockholders' Eq Total Liabilities a External financin c. Martin Manufacturing will need external financing of 315k. The firm is not abl Since the debt ratio is already too high, another loan might not be such a goo The company should issue stock in order to fund the 400k purchase of new e Furthermore, the company could try to reduce dividends. Remark: in this calculation the lower variable cost per unit is not taken into a
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This note was uploaded on 03/25/2011 for the course IBS 000 taught by Professor Oema during the Spring '11 term at Hanze HS Groningen.

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Case 3 and 4 COF1 - Martin Manufacturing Company Pro forma Income Statement 2010 Data Item Sales revenu less COGS Gross Profits Less Operating

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