22 May Finance
| You are given the following information about XYZ Corporation: | ||||||||||||
| Account Name | Value | |||||||||||
| Accounts payable | 5800 | |||||||||||
| Accounts receivable | 10600 | |||||||||||
| Accumulated depreciation | 34000 | |||||||||||
| Cash | 17550 | |||||||||||
| Common stock (10,000 shares) | 46000 | |||||||||||
| Cost of goods sold | 6,750 | |||||||||||
| Depreciation expense | 600 | |||||||||||
| Earnings before taxes | ????? | |||||||||||
| General & admin expense | 950 | |||||||||||
| Gross buildings & equipment | 123000 | |||||||||||
| Gross profits | 26,250 | |||||||||||
| Interest expense | 4,300 | |||||||||||
| Inventories | 7500 | |||||||||||
| Long-term debt | 56000 | |||||||||||
| Net buildings & equipment | 89000 | |||||||||||
| Net income | ????? | |||||||||||
| Operating income (EBIT) | ????? | |||||||||||
| Retained earnings | 16150 | |||||||||||
| Sales | 33,000 | |||||||||||
| Short-term notes payable | 700 | |||||||||||
| Taxes @40% | 8,160 | |||||||||||
| Required: | ||||||||||||
| Using the Data above, complete the following on the templates provided: | ||||||||||||
| Part 1: Complete the Balance Sheet and Income Statement for XYZ Corporation | ||||||||||||
| Part 2: Calculate the Ratios for XYZ Corporation | ||||||||||||
| Part 3: Complete the Ratio analysis using Cross-Sectional Analysis and Trend Analysis | ||||||||||||
| Use this Templates for Part 1: | ||||||||||||
| XYZ Corporation | ||||||||||||
| Balance Sheet | ||||||||||||
| As of December 31, 20XX | ||||||||||||
| Assets | ||||||||||||
| Current Assts | ||||||||||||
| Total Current Assets | ||||||||||||
| Total Assets | ||||||||||||
| Liabilities and Equity | ||||||||||||
| Liabilities | ||||||||||||
| Total Current Liabilities | ||||||||||||
| Total Liabilities | ||||||||||||
| Equity | ||||||||||||
| Total Equity | ||||||||||||
| Total Liabilities and Equity | ||||||||||||
| XYZ Corporation | ||||||||||||
| Income Statement | ||||||||||||
| For the year ending December 31, 20XX | ||||||||||||
| Sales | ||||||||||||
| Net Income | ||||||||||||
| Use the Template below for Part Two: | ||||||||||||
| Ratio | Formula | Your Answer | ||||||||||
| Operating Profit Margin After Taxes | ||||||||||||
| Gross Profit Margin | ||||||||||||
| Average Collection Period | ||||||||||||
| Total Asset Turnover | ||||||||||||
| Fixed Asset Turnover | ||||||||||||
| Inventory Turnover | ||||||||||||
| Debt to Total Assets | ||||||||||||
| Times Interest Earned | ||||||||||||
| Ratio | Company Year 1 | Company Year 2 | Industry Average | Cross Sectional Analysis (% Difference) | Trend Analysis (% Change) | |||||||
| Current Ratio | 5x | 3x | 4x | |||||||||
| Quick Ratio | 3x | 1.6x | 3x | |||||||||
| Total Asset Turnover | .4xx | .56x | .7x | |||||||||
| Average Collection Period | 130 days | 110 days | 100 days | |||||||||
| Inventory Turnover | 1.20x | 1.41 x | 2.2x | |||||||||
| Fixed Asset Turnover | 1.01x | 1.20x | 1.1x | |||||||||
| Debt Ratio | 30% | 34% | 33% | |||||||||
| Times Interest Earned | 4.0x | 5.0x | 6.0x | |||||||||
| Return on Common Equity | 8% | 12% | 10% | |||||||||
| Summarize Your Findings Below: | ||||||||||||
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