Ch12 P11 Build a Model - 11/22/10 Ch 12-11 Build a Model...

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Unformatted text preview: 11/22/10 Ch 12-11 Build a Model Balance Sheet, M at hews, 12/31/10 Incom e Statem ent, M at hews, 2010 Cash and securities $120 Sales $12,000.0 Accounts receivable 1,584 Total operating costs 11,040.0 Inventories 2,145 EBIT $960.0 Total current as ets $3,849 Interest 250.0 Net fixed as ets 2,748 EBT $710.0 Total as ets $6,597 Taxes(40% ) 284.0 Net incom e $426.0 Accounts payable + accruals $747 Dividends (45% ) $191.7 Notes payable 1,200 Add'n to retained earnings $234.3 Total current liabilities $1,947 Shares outstanding 150.000 Long-term debt 1,300 EPS $2.84 Total liabilities $3,247 DPS $1.28 Com m on stock 2,250 Year-end stock price $22.72 Retained earnings 1,100 Total com m on equity $3,350 Total claim s on as ets $6,597 Selected Ratios and Other Data, 2010 M at hews Industry $12,000 $12,000 Expected growth in sales: 10.0% 10.0% Profit margin (M , or PM ): 3.55% 4.50% 55.0% 50.0% Payout ratio (POR): 45.0% 40.0% Equity multiplier (Assets/Equity): 1.97 1.67 Debt ratio (T otal debt/T otal claims): 49.2% 40.0% T imes interest earned (EBIT /Interest): 3.84 4.20 $1,200 $1,200 6.2% 4.0% Operating costs/Sales: 92.0% 85.0% Cash/Sales: 1.0% 1.0% Receivables/Sales: 13.2% 10.0% Inventories/Sales: 17.9% 15.0% Fixed assets/Sales: 22.9% 20.0% T ax rate: 40.0% 40.0% Interest rate on al debt: 10.0% 9.5% Price/Earning (P/E): 8.0 12.5 ROE (Net incom e/Com m on equity): 12.72% 15.00% Add'l Req'd Assets-- Add'n to RE =-- =-- =-- mil ion Self-supporting g = = = Forecasted Financial Statements No Adjustm ent for New Interest N o Adjustment for N ew Interest Data Used in the Scenarios Inputs for Forecasts Steady State Target Active Steady Target Growth rate 10.0% 10.0% 10.0% Operating costs/Sales 92.0% 92.0% 87.5% Cash/Sales 1.0% 1.0% 1.0% Receivables/Sales 13.2% 13.2% 12.0% Inventories/Sales 17.875% 17.875% 16.000% Fixed as ets/Sales 22.9% 22.9% 21.5% Payables and Accruals/ Sales 6.225% 6.225% 5.000% Interest rate on notes and bonds 10.0% 10.0% 9.5% Payout ratio 45.0% 45.0% 42.5% Tax rate 40% 40.0% 40% P/E ratio 8.0 8.0 12.5 Shares outstanding (m il ions) 150.000 150.000 150.000 No Adjustm ent for New Interest No Adjustm ent for New Interest M at hews Forecast This data is for : 0 2011 Balance Sheet 2010 Factor Procedure for 2011 Forecast Forecast As ets Cash $120 0.00% Factor Forecasted Sales $0.0 Accounts receivable 1,584 0.00% Factor Forecasted Sales 0.0 Inventories 2,145 0.00% Factor Forecasted Sales 0.0 Total current as ets $3,849 $0.0 Net fixed as ets 2,748 0.00% Factor Forecasted Sales 0.0 Total as ets $6,597 $0.0 Claim s on As ets Accts payable and accruals $747 0.00% Factor Forecasted Sales $0.0 Notes payable: Original 1,200 Carry over 2010 am ount 1,200.0 Notes payable: New New notes (+/-) to balance 0.0 Total current liabs $1,947 $1,200.0 Long-term debt 1,300 Carry over 2010 am ount 1,300.0 Total liabilities $3,247 $2,500.0 Com m on stock 2,250 Carry over 2010 am ount 2,250.0 Retained earnings 1,100 2010 + Add'n to RE from Incom e Statem ent...
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Ch12 P11 Build a Model - 11/22/10 Ch 12-11 Build a Model...

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