Finance-04 Chapter model COMPARATIVE SIZE BALANCE SHEETS – Allied Food

| January 31, 2017

Question
04 Chapter model
COMPARATIVE SIZE BALANCE SHEETS – Allied Food Products – December 31
(in millions of dollars)
2013 2012
Assets
Cash and equivalents $ 10 $ 80
Accounts receivable 375 315
Inventories 615 415
Total current assets $ 1,000 $ 810
Net plant and equipment 1,000 870
Other LT assets – –
Total assets $ 2,000 $ 1,680
Liabilities and equity
Accounts payable $ 60 $ 30
Notes payable 110 60
Accruals 140 130
Total current liabilities $ 310 $ 220
Long-term bonds 750 580
Total debt $ 1,060 $ 800
Common stock (50M shares) 130 130
Retained earnings 1,410 750
Total common equity $ 1,540 $ 880
Total liabilities and equity $ 2,600 $ 1,680
INCOME STATEMENTS – Allied Food Products – Years Ending December 31
(in millions of dollars)
2013 2012
Net sales $ 3,000.0 $ 2,850.0
COGS $ 1,000.0 $ 1,000.0
Gross Margin $ 2,000.0 $ 1,850.0
Oper costs except depr’n & amort. 1,616.2 1,497.0
Depreciation and amortization 100.0 90.0
Operating income (EBIT) $ 1,283.8 $ 1,263.0
Less interest 88.0 60.0
Earnings before taxes (EBT) $ 1,195.8 $ 1,203.0
Taxes 478.3 481.2
Net income $ 717.5 $ 721.8
EBITDA Calculation
Net Income
Interest
Taxes
Depreciation/Amortization
EBITDA
SECTIONS 4-1 TO 4-6, RATIO ANALYSIS
Liquidity ratios 2011 2010 Ind Avg
Current Ratio 4.20
Quick Ratio 2.20
Asset Management ratios
Inventory Turnover 10.90
Days Sales Outstanding 36.00
Debt Management ratios
Debt to EBITDA Bank
Loan to Value 400 Bank
Profitability ratios
Gross Margin % 50%
EBITDA Margin % 15%
Operating Margin 10%
Profit Margin 5%
Return on Equity 15%
Market Value ratios
EBITDA Multiple @ 5X 5.00
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