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1. York Inc is a consumer products firm listed in the US stock markets. Its Balance Sheet and Income Statements for the years ending 2019
1. York Inc is a consumer products firm listed in the US stock markets. Its Balance Sheet and Income Statements for the years ending 2019 and 2018 are given below. The Reformulated Statement of Stockholders Equity for the years ending 2019 and 2018 are given below.
Notes:
- The firm bears a 35% statutory tax rate.
- Working cash is estimated to be $120 million and $115 million for 2019 and 2018 respectively.
- Notes receivable bear interest of 8% per calendar year.
Required:
- Prepare the Reformulated Balance Sheet and Income Statements for the years 2019 and 2018 in preparation for valuation.
- Why are reformulated financial statements necessary? (200-300 words)
- Comment on what the reformulated financial statements tell you about Yorks strategy. (200-300 words)
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