Chapter 3

Problems 1-30
Input boxes in tan Output boxes in yellow Given data in blue Calculations in red Answers in green
NOTE: Some functions used in these spreadsheets may require that the "Analysis ToolPak" or "Solver Add-in" be installed in Excel. To install these, click on "Tools|Add-Ins" and select "Analysis ToolPak" and "Solver Add-In."

sis ToolPak"

Chapter 2 Cash Flows at Warf Computer, Inc.

2010 Current assets Cash and equivalents Accounts receivable Inventories Other Total current assets Fixed assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Intangible assets and others Total fixed assets

Balance Sheet (in $ thousand 2009 $251 428 425 50 $1,154

$290 459 411 59 $1,219

$2,631 859 $1,772 508 $2,280

$2,038 700 $1,338 454 $1,792

Total assets Acquisition of fixed assets Sale of fixed assets New debt issued Debt retired New stock issued Stock repurchased Income Statement (in $ thousands) Sales Cost of goods sold Selling, general, and administrative Depreciation Operating income Other income EBIT

$3,499 $786 $139 $118 $98 $11 $40

$2,946

$4,844 2,858 543 159 $1,284 48 $1,332

Interest expense Pretax income Taxes Current Deferred Net income Retained earnings Dividends

95 $1,237 495 $386 $109 $742 $530 $212

Output area:

Operating cash flow Earnings before interest and taxes Depreciation -Current taxes Operating cash flow

$1,332 159 386 $1,105

Net capital spending Acquisition of fixed assets Sale of fixed assets Capital spending Alternatively, Ending fixed assets -Beginning fixed assets Depreciation Capital spending

$786 $(139) $647

$2,280 1,792 159 $647

Net working capital cash flow Ending NWC Beginning NWC NWC cash flow

$728 586 $142

Cash flow from assets OCF

$1,105

-Net capital spending -Change in NWC Cash flow from assets

647 142 $316

Cash flow to creditors Interest Retirement of debt Debt service Proceeds from sale of long-term debt Total Alternatively Beginning long-term debt Ending long-term debt Interest Total

$95 98 $193 (118) $75

$736 (756) 95 $75

Cash flow to stockholders Dividends Repurchase of stock Cash to stockholders Proceeds from new stock issue Total Alternatively Beginning total equity Ending total equity Dividends Retained earnings

$212 40 $252 (11) $241

$1,539 (2,040) 212 530 $241

Statement of cash flows Operations Net income Depreciation Deferred taxes Changes in assets and liabilities Accounts receivable Inventories $742 159 109 (31) 14

Accounts payable Accrued expenses Other Total cash flow from operations Investing activties Acquisition of fixed assets Sale of fixed assets Total cash flow from investing activities Financing activties Retirement of debt Proceeds of long-term debt Notes payable Dividends Repurchase of stock Proceeds from new stock issues Total cash flow from financing activities Change in cash (on balance sheet)

17 (99) (9) $902

$(786) 139 $(647)

$(98) 118 5 (212) (40) 11 $(216) $39

Sheet (in $ thousands) 2010 Current liabilities Accounts payable Notes payable Accrued expenses Total current liabilities Long-term liabilities Deferred taxes Long-term debt Total long-term liabilities Stockholders equity Preferred stock Common stock Capital surplus Accumulated retained earnings Less treasury stock Total equity Total liabilities and shareholders equity $262 71 158 $491 2009 $245 66 257 $568

$212 756 $968

$103 736 $839

$13 81 509 1,558 121 $2,040

$13 80 499 1,028 81 $1,539

$3,499

$2,946

Chapter 3
Question 1 Input area:

Equity multiplier Total asset turnover Profit margin

1.35 2.15 5.80%

Output area:

Return on equity

16.83%

Chapter 3
Question 3 Input area:

Sales Total assets Debt-equity ratio Return on equity

$3,100 1,580 1.20 16%

Output area:

Profit margin Net income

0.0371 $114.91

Chapter 3
Question 4 Input area:

Sales Costs Taxable income Taxes (34%) Net income Tax rate Dividend paid Next year's sales

$25,800 16,500 $9,300 3,162 $6,138 34% $1,841.40 $30,960

Assets Total

$113,000 Debt Equity $113,000 Total

Output area:

Percent increase in sales = Pro forma income statement Sales $30,960.00 Costs 19,800.00 Taxable income $11,160.00 Taxes (34%) 3,794.40 Net income $7,365.60 Dividends $2,209.68 Add. To RE $5,155.92 External financing $17,444.08

20% Pro forma balance sheet Assets $135,600.00 Debt Equity Total $135,600.00 Total

$20,500 92,500 $113,000

$20,500.00 97,655.92 $118,155.92

Chapter 4
Question 5 Input area:

Sales Costs Taxable income Taxes (34%) Net income Tax rate Payout ratio

$67,000 43,800 $23,200 7,888 $15,312 34% 30%

Current assets Fixed assets Total

$31,000 118,000 $149,000

Output area:

Return on equity Plowback ratio Sustainable growth rate Maximum increase in sales

18.90% 0.70 15.25% $10,217.93

Long-term debt Equity Total

$68,000 81,000 $149,000

Chapter 3 Ratios and Financial Planning at East Coast Yachts

Tax rate Sales COGS Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends Add to RE Assets Current Assets Cash Accounts rec. Inventory Total CA Fixed assets Net PP&E $3,042,000 5,473,000 6,136,000 $14,651,000

40% $167,310,000 117,910,000 19,994,000 5,460,000 $23,946,000 3,009,000 $20,937,000 8,374,800 $12,562,200 $7,537,320 $5,024,880

$93,964,000

Total assets Growth rate Minimum FA purchase

$108,615,000 20% $30,000,000

Output area:

1) Current ratio

0.75

Quick ratio Total asset turnover Inventory turnover Receivables turnover Debt ratio Debt-equity ratio Equity multiplier Interest coverage Profit margin Return on assets Return on equity 3) Retention ratio Sustainable growth rate Sales COGS Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends Add to RE Assets Current Assets Cash Accounts rec. Inventory Total CA Fixed assets Net PP&E

0.44 1.54 19.22 30.57 0.49 0.96 1.96 7.96 7.51% 11.57% 22.70% 0.40 9.99% $184,018,615 129,685,224 21,990,725 5,460,000 $26,882,666 3,009,000 $23,873,666 9,549,466 $14,324,199 $8,594,520 5,729,680

$3,345,793 6,019,568 6,748,779 $16,114,140

$103,347,828

Total Assets EFN

$119,461,968 $3,166,002

Current ratio Quick ratio Total asset turnover Inventory turnover Receivables turnover Debt ratio Debt-equity ratio Equity multiplier Interest coverage Profit margin Return on assets Return on equity 4) Sales COGS Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends Add to RE Assets Current Assets Cash Accounts rec. Inventory Total CA Fixed assets Net PP&E

0.75 0.44 1.54 19.22 30.57 0.49 0.90 1.96 8.93 7.78% 11.99% 23.46% $200,772,000 141,492,000 23,992,800 5,460,000 $29,827,200 3,009,000 $26,818,200 10,727,280 $16,090,920 $9,654,552 6,436,368

$3,650,400 6,567,600 7,363,200 $17,581,200

$112,756,800

Total Assets EFN

$130,338,000 $11,378,832

5) EFN if minimum FA purchase is

$30,000,000

Depreciation as a percentage of fixed assets New fixed assets New depreciation Sales COGS Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends Add to RE Assets Current Assets Cash Accounts rec. Inventory Total CA Fixed assets Net PP&E $3,650,400 6,567,600 7,363,200 $17,581,200 $200,772,000 141,492,000 23,992,800 7,203,221 $28,083,979 3,009,000 $25,074,979 10,029,992 $15,044,988 $9,026,993 6,017,995

$123,964,000

Total Assets EFN

$141,545,200 $23,004,405

ast Yachts

Liabilities & Equity Current liabilities Accounts payable $6,461,000 Notes payable 13,078,000 Total CL $19,539,000 Long-term debt Shareholder equity Common stock Retained earnings Total equity Total L&E $33,735,000

$5,200,000 50,141,000 $55,341,000 $108,615,000

Liabilities & Equity Current liabilities Accounts payable $7,106,236 Notes payable 14,384,050 Total CL $21,490,286 Long-term debt Shareholder equity Common stock Retained earnings Total equity Total L&E $33,735,000

$5,200,000 55,870,680 $61,070,680 $116,295,966

Liabilities & Equity Current liabilities Accounts payable $7,753,200 Notes payable 15,693,600 Total CL $23,446,800 Long-term debt Shareholder equity Common stock Retained earnings Total equity Total L&E $33,735,000

$5,200,000 56,577,368 $61,777,368 $118,959,168

5.81% $123,964,000 $7,203,221

Liabilities & Equity Current liabilities Accounts payable $7,753,200 Notes payable 15,693,600 Total CL $23,446,800 Long-term debt Shareholder equity Common stock Retained earnings Total equity Total L&E $33,735,000

$5,200,000 56,158,995 $61,358,995 $118,540,795