Income Statements Liquidity Ratios: Fimancial Leverage: 2012 2013 Change 2012 20
ID: 2332010 • Letter: I
Question
Income Statements Liquidity Ratios: Fimancial Leverage: 2012 2013 Change 2012 2013 Chauge Industry $1,300,000 $1,500,000 $1,800,000 Total-Debt-to-Total-Assets NWC-to-Total Assets Debt-to-Equity Ratio Current-Liab-to-Total Debt Cash Conversion Cycle (in Days) 2012 2013 Change Industry Profitability Ratios: 2012 2013 Change Industry Profit Margin NOPAT Margin Cash Build Versus Cash Burn: Balance Sheets 2012 013 Change Efficiency and Return Ratios 2012 2013 Change Industry Increase in Receivables (negative effect) Operating Return on Assets Return on Assets (ROA) Return on Equity (ROE) Cost of Goods Sold $1,000,000 $1,200,000 $1,470,000 130,000 $170,000 $180,000 Cash Burn from Inc, Sn Change in Payables (negative effect) Change in Acerued Liab Increase in Fixed Assets, Net $1,000,000 $1,200,000 $1,470,000 Inc. in Gross Fixed AssetsExplanation / Answer
2012 2013 Remarks: A Current Assets $800,000 $970,000 B Current Liabilities $330,000 $444,000 C Quick Assets $300,000 $370,000 2012Quick asset=(800000-500000) A/B Current Ratio 2.424242424 2.184684685 2013 QuickAssets=(970000-600000) C/B QuickRatio 0.909090909 0.833333333 Liquidity Ratios 2012 2013 Change Current Ratio 2.424242424 2.184684685 -0.23955774 QuickRatio 0.909090909 0.833333333 -0.075757576 CASH CONVERSION CYCLE: 2012 2013 A Cost of goods sold $900,000 $1,260,000 B Beginning Inventory $450,000 $500,000 C Ending Inventory $500,000 $600,000 D=(B+C)/2 Average inventory $ 475,000 $ 550,000 E=365/(A/D) Inventory toSales(days) 192.6388889 159.3253968 F Sales $1,500,000 $1,800,000 G Beginning Accounts Receivable $200,000 $260,000 H Ending Accounts Receivable $260,000 $360,000 I=(G+H)/2 Average Accounts Receivable $ 230,000 $ 310,000 J=365/(F/I) Sales to cash (days) 55.96666667 62.86111111 K Beginning Accounts payable $130,000 $170,000 L Ending accounts payable $170,000 $180,000 M=(K+L)/2 Average accounts Payable $ 150,000 $ 175,000 N=365/(A/M) Purchase to payment(days) 60.83333333 50.69444444 P=E+J-N CASH CONVERSION CYCLE: 187.7722222 171.4920635 Cash Conversion Cycle in Days 2012 2013 Change Industry Inventory toSales(days) 193 159 -33 Data Sales to cash (days) 56 63 7 Not Purchase to payment(days) 61 51 -10 Available CASH CONVERSION CYCLE: 188 171 -16 FINANCIAL LEVERAGE 2012 2013 A Total Debt $ 730,000 $ 994,000 TotalDebt 2012=(330000+400000) B TotalAssets $1,200,000 $1,470,000 TotalDebt 2013=(444000+550000) C Shareholder Equity $ 470,000 $ 476,000 Equity 2012=(350000+120000) D Current Liabilities $330,000 $444,000 Equity 2013=(350000+126000) E Earning Before interest and taxes(EBIT) $247,000 $80,000 F Interest expenses $57,000 $70,000 2012 2013 Change Industry A/B Total Debt to totalAssets 0.608333333 0.676190476 0.067857143 Data B/C Equity Multiplier 2.553191489 3.088235294 0.535043805 Not A/C Debt toEquity Ratio 1.553191489 2.088235294 0.535043805 Available D/A Current Liability to total Debt 0.452054795 0.44668008 -0.005374714 E/F Interest Coverage 4.333333333 1.142857143 -3.19047619 PROFITABILITY RATIO 2012 2013 G Sales $1,500,000 $1,800,000 H Gross Profit $600,000 $540,000 I Operating Profit $247,000 $80,000 J Net Profit $114,000 $6,000 K Tax rate 0.40 0.40 L=I*(1-K) NOPAT(Net Operating Profit After Tax) $148,200 $48,000 2012 2013 Change Industry H/G Gross Profit Margin 40.00% 30.00% -10.00% Data I/G Operating Profit Margin 16.47% 4.44% -12.02% Not J/G Net Profit Margin 7.60% 0.33% -7.27% Available L/G NOPAT Margin 9.88% 2.67% -7.21%