$10.00 need help asap
1. The Waterford Wax Company had the following current account activity last year.
Beginning Ending Beginning Ending
Cash $ 160 $ 333 Accts Pay $722 $2,084
Accts Rec 1,875 3,810 Accruals $217 456
Inventory 438 2,676
Curr Assets $2,473 $6,819 Curr Liab. $939 $2,540
a. Calculate and display the current account detail required for the Cash From Operating Activities section of the Statement of Cash Flows.
b. If you also knew that Waterford’s revenues had risen by 20% last year, would you be concerned about the firm’s financial health? Why? (Words only.)
11. Linden Corp. has a 10% market share in its industry. Below are income statements ($M) for Linden and for the industry.
Sales $6,000 $64,000
Cost of Goods Sold 3,200 33,650
Gross Margin 2,800 30,350
Sales and Marketing 430 3,850
Engineering 225 2,650
Finance and Administration 650 4,560
Total Expenses 1,305 11,060
EBIT 1,495 19,290
Interest Expense 230 4,500
EBT 1,265 14,790
Tax 500 5,620
Net Income 765 9,170
a. Develop common sized income statements for Linden and the industry as a whole.
b. What areas should management focus on to improve performance, and what kind of issues should be examined or looked for in each area?
1. The Lineberry Golf Cart Co. sold 7,400 carts this year at an average unit price of $3,000. 50 days of sales remained uncollected in accounts receivable at the end of the year. The firm produced the carts at a 42% cost ratio (COGS/Revenue) and had three months of inventory on hand at year end (3/12 of the year’s COGS).
The golf business is booming and management plans a 10% increase in unit sales despite a 5% price increase. The firm has programs in place to improve production efficiency, inventory management, and the effectiveness of collections efforts. It is assumed that these programs will decrease the cost ratio to 40%, lower year end inventory to 2 months, and lower year end receivables to 40 days of sales.
Compute Lineberry’s revenue, COGS (cost of goods sold) and gross margin as well as ending receivables and inventory for this year and next year’s plan. Calculate using a 360 day year and assume sales are evenly distributed over the year.
2. The Cambridge Cartage Company has partially completed its forecast of next year's financial statements as follows.
CAMBRIDGE CARTAGE COMPANY
INCOME STATEMENT BALANCE SHEET
NEXT YEAR Beginning Ending
Rev $17,220 ASSETS
Cost/Exp 14,120 Total Assets $12,540 $18,330
EBIT $ 3,100 LIABILITIES & EQUITY
Interest ? Current Liabs $ 410 $ 680
EBT ? Debt $ 5,630 ?
Tax ? Equity $ 6,500 ?__
EAT ? Total L&E $12,540 $18,330
The firm pays interest at 10% on all borrowings and pays a combined state and federal tax rate of 40%. Complete the forecasted income statement and balance sheet. Begin by guessing at interest expense as 10% of beginning debt.
A+ WORK.docx (17K) (Preview)