1. Billy Bishop has recently been approached by his father-in-law, Jack Wilde, with a proposal to buy 30 percent interest in Panchetta Sporting Goods. The firm manufactures golf clubs, baseball bats, basketball nets, and other similar items. Mr. Wilde is quick to point out the increase in sales that has occurred over the past three years as indicated in the following income statement. The annual growth rate was 20 percent. During this time there was a steady real growth of 2 to 3 percent in GDP during the period under study. The rate of inflation was in the 3 to 4 percentage range. Stock in this company was available because of the ill-health of a major shareholder. The company currently does not pay dividends, and a return would come through selling the stock in the future. Would you invest? PANCHETTA SPORTING GOODS Income Statements Year Ended 2018 2017 2016 $ 2,160,000 S 1,800,000 $ 1,500,000 1,300,000 1,120,000 950,000 680,000 550,000 Sales (all on credit). Cost of goods sold. Gross profit... Selling/administrative expense" Operating profit (EBIT) Interest expense. Net income before taxes 860,000 590,000 490,000 380,000 190,000 170,000 270,000 85,000 40,000 30,000 185,000 150,000 140,000 46,120 93,880 Taxes 64,850 48.720 Net income $ 120,150 $ 101.280 S Shares 46,000 40,000 Earnings per share 52.61 $2.53 *Includes $15,000 in lease payments for each year, 40,000 $2.35 PANCHETTA SPORTING GOODS Balance Sheet Dec. 31, 2018 2017 2016 Assets Cash $ 20,000 $ 30,000 $ 20,000 Marketable securities. 50,000 30,000 35,000 230,000 Accounts receivable 330,000 150,000 Inventory... 325,000 285,000 250,000 Total current assets. 725,000 580,000 450,000 Net plant and equipment 1.169.000 720,000 550,000 Total assets. $1,894.000 $ 1,300,000 $ 1,000,000 Liabilities and Shareholders' Equity Accounts payable $ 200,000 $225,000 $ 100,000 Accrued expenses. 300,000 100,000 100,000 Total current liabilities 500.000 325,000 200,000 Long-term liabilities 550.740 331.120 250,000 Total liabilities... 1.050,740 656.120 450.000 Common stock 540,000 450,000 450,000 Retained earnings 303.260 193.880 100,000 Total shareholders' equity 843.260 643.880 550.000 Total liabilities and shareholders' equity $1.894.000 5 1.300.000 $ 1.000.000 Selected INDUSTRY Ratios 20XX 20xw 20XV Growth in sales.. 10.02% 9.98% 5.81% 5.80% 5.75% 8.48% 8.24% 8.22% 10.10% 13.62% 13.26% Profit margin... Return on assets (investment). Return on equity... Receivables tumover..... Average collection period. Inventory turnover Capital asset tumover 9.31% 9.50 10.00 35.6 days 37.9 days 36.0 days 5.84 5.62% 5.71% 2.20 2.66% 2.75 Total asset turnover..... 1.46x 1.42 1.43x 2.15 2.08 2.10X Current ratio.. Quick ratio 1.10 1.02 1.05 Debt to total assets 40.10% 39.50% 38.00% Times interest earned 5.26 5.20 5.00 Fixed charge coverage... 3.97 3.95 3.85% Growth in camingo per share 9.80% 9.7014 Financial Statement Assignment Attached Files Financial Statement Assignment HINA 255.xx (10474 KB) Please read the instructions within the Excel document, submit the separate financial documents on three separate excel sheets within the document that you submit ose format your financial documents the best that you can. The project will not be due until Thursday evening midnight. Lot me know if you have any cost Financial Analysis Take Home Attached Files Financial Analysis Assignment.docx (23235 KB) Attached I have the chapter 3 financial analysis take home assignment. The assignment fairly self-explanatory within the instructions of the document, but I did have a few things that wanted to add in the introduction here Mary students when given this assignment will make the mistake to only culate the ratios discussed in the classes covering Chapter 1. While calculating an importante the completion of this assignment. It is not the ONLY step. Make sure to undertake as much cialdeduction you feel necessary while wearing your investora Berto Trend and ratio analysis during your analysis. Leave no stone unturned Your submitted document should have ample dialogue ding wlw you choose or choose not to meet in the compare white horferencing the numeros tut you love chosen to calculate. I don't need to see your roup work in calculating the ratios in the smitted document Please let me know if you have any questions! 1. Billy Bishop has recently been approached by his father-in-law, Jack Wilde, with a proposal to buy 30 percent interest in Panchetta Sporting Goods. The firm manufactures golf clubs, baseball bats, basketball nets, and other similar items. Mr. Wilde is quick to point out the increase in sales that has occurred over the past three years as indicated in the following income statement. The annual growth rate was 20 percent. During this time there was a steady real growth of 2 to 3 percent in GDP during the period under study. The rate of inflation was in the 3 to 4 percentage range. Stock in this company was available because of the ill-health of a major shareholder. The company currently does not pay dividends, and a return would come through selling the stock in the future. Would you invest? PANCHETTA SPORTING GOODS Income Statements Year Ended 2018 2017 2016 $ 2,160,000 S 1,800,000 $ 1,500,000 1,300,000 1,120,000 950,000 680,000 550,000 Sales (all on credit). Cost of goods sold. Gross profit... Selling/administrative expense" Operating profit (EBIT) Interest expense. Net income before taxes 860,000 590,000 490,000 380,000 190,000 170,000 270,000 85,000 40,000 30,000 185,000 150,000 140,000 46,120 93,880 Taxes 64,850 48.720 Net income $ 120,150 $ 101.280 S Shares 46,000 40,000 Earnings per share 52.61 $2.53 *Includes $15,000 in lease payments for each year, 40,000 $2.35 PANCHETTA SPORTING GOODS Balance Sheet Dec. 31, 2018 2017 2016 Assets Cash $ 20,000 $ 30,000 $ 20,000 Marketable securities. 50,000 30,000 35,000 230,000 Accounts receivable 330,000 150,000 Inventory... 325,000 285,000 250,000 Total current assets. 725,000 580,000 450,000 Net plant and equipment 1.169.000 720,000 550,000 Total assets. $1,894.000 $ 1,300,000 $ 1,000,000 Liabilities and Shareholders' Equity Accounts payable $ 200,000 $225,000 $ 100,000 Accrued expenses. 300,000 100,000 100,000 Total current liabilities 500.000 325,000 200,000 Long-term liabilities 550.740 331.120 250,000 Total liabilities... 1.050,740 656.120 450.000 Common stock 540,000 450,000 450,000 Retained earnings 303.260 193.880 100,000 Total shareholders' equity 843.260 643.880 550.000 Total liabilities and shareholders' equity $1.894.000 5 1.300.000 $ 1.000.000 Selected INDUSTRY Ratios 20XX 20xw 20XV Growth in sales.. 10.02% 9.98% 5.81% 5.80% 5.75% 8.48% 8.24% 8.22% 10.10% 13.62% 13.26% Profit margin... Return on assets (investment). Return on equity... Receivables tumover..... Average collection period. Inventory turnover Capital asset tumover 9.31% 9.50 10.00 35.6 days 37.9 days 36.0 days 5.84 5.62% 5.71% 2.20 2.66% 2.75 Total asset turnover..... 1.46x 1.42 1.43x 2.15 2.08 2.10X Current ratio.. Quick ratio 1.10 1.02 1.05 Debt to total assets 40.10% 39.50% 38.00% Times interest earned 5.26 5.20 5.00 Fixed charge coverage... 3.97 3.95 3.85% Growth in camingo per share 9.80% 9.7014 Financial Statement Assignment Attached Files Financial Statement Assignment HINA 255.xx (10474 KB) Please read the instructions within the Excel document, submit the separate financial documents on three separate excel sheets within the document that you submit ose format your financial documents the best that you can. The project will not be due until Thursday evening midnight. Lot me know if you have any cost Financial Analysis Take Home Attached Files Financial Analysis Assignment.docx (23235 KB) Attached I have the chapter 3 financial analysis take home assignment. The assignment fairly self-explanatory within the instructions of the document, but I did have a few things that wanted to add in the introduction here Mary students when given this assignment will make the mistake to only culate the ratios discussed in the classes covering Chapter 1. While calculating an importante the completion of this assignment. It is not the ONLY step. Make sure to undertake as much cialdeduction you feel necessary while wearing your investora Berto Trend and ratio analysis during your analysis. Leave no stone unturned Your submitted document should have ample dialogue ding wlw you choose or choose not to meet in the compare white horferencing the numeros tut you love chosen to calculate. I don't need to see your roup work in calculating the ratios in the smitted document Please let me know if you have any questions
