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B. How would your answer in Part A change it the expecteu saies grumu 4. (Sustainable...
Pro Forma Statements and Ratios Cavuto makes bulk purchases of men's and women's shoes, stocks them...
Pro Forma Statements and Ratios Cavuto makes bulk purchases of
men's and women's shoes, stocks them in conveniently located
warehouses, and ships them to its chain of retail stores. Cavuto's
balance sheet as at December 31, 2015, is shown here (millions of
dollars).
Sales for 2015 were $350 million, while net income for the year
was $14.35 million. Cavuto paid dividends of $5.74 million to
common shareholders. The firm is operating at full capacity. Assume
that all ratios remain constant....
EXCESS CAPACITY a. Assume that the company was operating at full capacity in 2016 with regard...
EXCESS CAPACITY
a.
Assume that the company was operating at full capacity in 2016 with
regard to all items except fixed assets; fixed assets in 2016 were
being utilized to only 75% of capacity. By what percentage could
2017 sales increase over 2016 sales without the need for an
increase in fixed assets? Round your answer to two decimal
places.
b. Now suppose 2017 sales increase by 30% over 2016 sales.
Assume that Krogh cannot sell any fixed assets. All...
EXCESS CAPACITY Krogh Lumber's 2016 financial statements are shown here. Krogh Lumber: Balance Sheet as of...
EXCESS CAPACITY Krogh Lumber's 2016 financial statements are shown here. Krogh Lumber: Balance Sheet as of December 31, 2016 (Thousands of Dollars) Cash $1,800 Accounts payable $7,200 Receivables 10,800 Notes payable 3,472 Inventories 12,600 Accrued liabilities 2,520 Total current assets $25,200 Total current liabilities $13,192 Mortgage bonds 5,000 Net fixed assets 21,600 Common stock 2,000 Retained earnings 26,608 Total assets $46,800 Total liabilities and equity $46,800 Krogh Lumber: Income Statement for December 31, 2016 (Thousands of Dollars) Sales $36,000 Operating...
ADDITIONAL FUNDS NEEDED Morrissey Technologies Inc.'s 2016 financial statements are shown here. Morrissey Technologies Inc.: Balance...
ADDITIONAL FUNDS NEEDED Morrissey Technologies Inc.'s 2016 financial statements are shown here. Morrissey Technologies Inc.: Balance Sheet as of December 31, 2016 Cash $180,000 Accounts payable $360,000 Receivables 360,000 Notes payable 56,000 Inventories 720,000 Accrued liabilities 180,000 Total current assets $1,260,000 Total current liabilities $596,000 Long-term debt 100,000 Fixed assets 1,440,000 Common stock 1,800,000 Retained earnings 204,000 Total assets $2,700,000 Total liabilities and equity $2,700,000 Morrissey Technologies Inc.: Income Statement for December 31, 2016 Sales $3,600,000 Operating costs including depreciation...
A’s sales are expected to increase by 15% from $8 million in 2016 to $9.2 million...
A’s sales are expected to increase by 15% from $8 million in 2016 to $9.2 million in 2017. A’s assets total $5 million at the end of 2016. A is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016 current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable and $450,000 of accruals. The after-tax profit margin is forecasted to be 6%, and...
AFN equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2016...
AFN equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2016 to $11.25 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets m. end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 5%, and the forecasted payout ratio is 75%. What...
Problem 4-31 EFN and Sustainable Growth (LO 2, 4) The most recent financial statements for Hopington...
Problem 4-31 EFN and Sustainable Growth (LO 2, 4) The most recent financial statements for Hopington Tours Inc. follow. Sales for 2018 are projected to grow by 30 and 35% in addition to 20%. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, and accounts payable increase spontaneously with sales. The firm wishes to keep its debt-equity ratio constant. (Do not round intermediate calculations. Round the final...
Cooper’s Lab, Inc.’s 2016 sales of $10,000 are expected to increase by 25% in 2017. The...
Cooper’s Lab, Inc.’s 2016 sales of $10,000 are expected to increase by 25% in 2017. The Lab’s total assets totaled $5,000 at the end of 2016. Currently the Lab is at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $900, consisting of $400 in accounts payable, $300 of notes payable, and $200 of accruals. The net profit margin is forecasted to be 6.0% and the forecasted...
3. Calculate the internal growth rate and sustainable growth rate for S&S Air. What do these...
3. Calculate the internal growth rate and sustainable growth rate for S&S Air. What do these numbers mean? 4. S&S Air is planning for a growth rate of 12 percent next year. Calculate the EFN for the company assuming the company is operating at full capacity (Hint: beside sales also assume that Costs of goods sold, Other expenses, all company assets and Accounts payable grow with 12%). Can the company's sales increase at this growth rate? S&S AIR, INC. 2012...
Additional Funds Needed The Booth Company's sales are forecasted to double from $1,000 in 2016 to...
Additional Funds Needed The Booth Company's sales are forecasted to double from $1,000 in 2016 to $2,000 in 2017. Here is the December 31, 2016, balance sheet: Cash $ 100 Accounts payable Accounts receivable Notes payable Inventories Accruals Net fixed assets Long-term debt Common stock 100 Retained earnings 250 Total assets $1000 Total liabilities and equity $1000 Booth's fixed assets were used to only 50% of capacity during 2016, but its current assets were at their proper levels in relation...
Pro Forma Statements and Ratios Cavuto makes bulk purchases of
men's and women's shoes, stocks them in conveniently located
warehouses, and ships them to its chain of retail stores. Cavuto's
balance sheet as at December 31, 2015, is shown here (millions of
dollars).
Sales for 2015 were $350 million, while net income for the year
was $14.35 million. Cavuto paid dividends of $5.74 million to
common shareholders. The firm is operating at full capacity. Assume
that all ratios remain constant....
EXCESS CAPACITY
a.
Assume that the company was operating at full capacity in 2016 with
regard to all items except fixed assets; fixed assets in 2016 were
being utilized to only 75% of capacity. By what percentage could
2017 sales increase over 2016 sales without the need for an
increase in fixed assets? Round your answer to two decimal
places.
b. Now suppose 2017 sales increase by 30% over 2016 sales.
Assume that Krogh cannot sell any fixed assets. All...
AFN equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2016 to $11.25 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets m. end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 5%, and the forecasted payout ratio is 75%. What...
Problem 4-31 EFN and Sustainable Growth (LO 2, 4) The most recent financial statements for Hopington Tours Inc. follow. Sales for 2018 are projected to grow by 30 and 35% in addition to 20%. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, and accounts payable increase spontaneously with sales. The firm wishes to keep its debt-equity ratio constant. (Do not round intermediate calculations. Round the final...
3. Calculate the internal growth rate and sustainable growth rate for S&S Air. What do these numbers mean? 4. S&S Air is planning for a growth rate of 12 percent next year. Calculate the EFN for the company assuming the company is operating at full capacity (Hint: beside sales also assume that Costs of goods sold, Other expenses, all company assets and Accounts payable grow with 12%). Can the company's sales increase at this growth rate? S&S AIR, INC. 2012...
Additional Funds Needed The Booth Company's sales are forecasted to double from $1,000 in 2016 to $2,000 in 2017. Here is the December 31, 2016, balance sheet: Cash $ 100 Accounts payable Accounts receivable Notes payable Inventories Accruals Net fixed assets Long-term debt Common stock 100 Retained earnings 250 Total assets $1000 Total liabilities and equity $1000 Booth's fixed assets were used to only 50% of capacity during 2016, but its current assets were at their proper levels in relation...
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