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Tutorial 3

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4 views

Tutorial 3

Uploaded by

mint chocolate
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Powerful Tools Inc.

Income Statement
For the Year Ended December 31, 2017
2017
Sales 714,286
Cost of Goods Sold 500,000
Gross Profit 214,286

Operating Expenses 107,143


EBIT 107,143
Interest Expense 23,810

Earnings Before Taxes 83,333

Taxes 33,333
Net Income 50,000

Notes: Tax Rate 40%

Ratio Value
Inventory Turnover 5.00x
Net Profit Margin 7%
Total Debt Ratio 60.00%
Gross Profit Margin 30.00%
Operating Profit Margin 15.00%
Return on Total Assets 5.00%
Long-Term Debt Ratio 50.00%
Powerful Tools Inc.
Balance Sheet
As of December 31, 2017
2017
Assets
Cash 70,000
Accounts Receivable 50,000
Inventories 100,000
Total Current Assets 220,000
Gross Fixed Assets 1,000,000
Accumulated Depreciation 220,000
Net Fixed Assets 780,000
Total Assets 1,000,000
Liabilities and Owner's Equity
Accounts Payable 20,000
Short-term Bank Notes 80,000
Total Current Liabilities 100,000
Long-term Debt 500,000
Total Liabilities 600,000
Common Equity 400,000
Total Liab. and OE 1,000,000

Ratio Value
Inventory Turnover 5
Net Profit Margin 7%
Total Debt Ratio 60.00%
Gross Profit Margin 30.00%
Operating Profit Margin 15.00%
Return on Total Assets 5.00%
Long-Term Debt Ratio 50.00%
Cristal Clear, Inc.
Income Statement
For the Year Ended Dec. 31, 2017
2017 2016
Sales 4,330,000 3,240,000
Cost of Goods 3,005,859 2,466,000
Gross Profit 1,324,141 774,000
G&A Expenses 987,641 207,000
Other Expenses 115,000 370,980
Depreciation 48,500 -19980
EBIT 173,000 216,000
Interest Expense 73,833 54,000
EBT 99,167 162,000
Taxes 39,667 64,800
Net Income 59,500 97,200
Notes
Tax Rate 40%
Cristal Clear, Inc.
Balance Sheet
As of Dec. 31, 2017
Assets 2017 2016

Cash and Equivalents 46,000 50,000

Accounts Receivable 309,286 360,000


Inventory 772,714 704,571
Total Current Assets 1,128,000 1,114,571

Plant & Equipment 434,667 435,000

Accumulated Depreciation 146,000 59,571

Net Fixed Assets 288,667 375,429

Total Assets 1,416,667 1,490,000


Liabilities and Owners' Equity
Accounts Payable 158,000 131,000
Short-term Notes Payable 201,000 264,500
Other Current Liabilities 121,000 117,000
Total Current Liabilities 480,000 512,500
Long-term Debt 370,000 167,500
Total Liabilities 850,000 680,000
Common Stock 367,667 408,000
Retained Earnings 199,000 402,000
Total Shareholder's Equity 566,667 810,000
Total Liab. and OE 1,416,667 1,490,000
Cristal Clear, Inc.
Ratios 2017 2016
Liquidity Ratios
Current Ratio 2.35 2.17x
Quick Ratio 0.74x 0.80x
Efficiency Ratios
Inventory Turnover Ratio 3.89x 3.50x
A/R Turnover Ratio 14.00x 9.00x
Average Collection Period 25.71 days 40.00 days
Fixed Asset Turnover 15.00x 8.63x
Total Asset Turnover 3.06x 2.17x
Leverage Ratios
Total Debt Ratio 60.00% 45.64%
Long-Term Debt Ratio 26.12% 35.00%
LTD to Total Capitalization 39.50% 17.14%
Debt to Equity 1.50x 0.84x
Long-Term Debt to Equity 65.29% 20.68%
Coverage Ratios
Times Interest Earned 2.34x 4.00x
Cash Coverage Ratio 3.00x 3.63x
Profitability Ratios
Gross Profit Margin 30.58% 23.89%
Operating Profit Margin 4.00% 6.67%
Net Profit Margin 1.37% 3.00%
Return on Total Assets 4.20% 6.52%
Return on Equity 10.50% 12.00%
Return on Common Equity 10.50% 12.00%

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