Answered step by step
Verified Expert Solution
Question
...
1 Approved Answer
BACKGROUNDS&S Air, Inc. was founded 1 0 years ago. The company has manufactured and sold light airplanes over this period, and the company's products have
BACKGROUNDS&S Air, Inc. was founded years ago. The company has manufactured and sold light airplanes over this period, and the company's products have received high reviews for safety and reliability. The company has a niche market in that it sells primarily to individuals who own and fly their own airplanes. The company has two models; the Birdie, which sells for $ and the Eagle, which sells for $ Although the company manufactures aircraft, its operations are different from commercial aircraft companies. S&S Air builds aircraft to order. By using prefabricated parts, the company can complete the manufacture of an airplane in only weeks. The company also receives a deposit on each order, as well as another partial payment before the order is complete. In contrast, a commercial airplane may take h to years to complete once the order is placed.Ratios to Include in AnalysisShort Term Liquidity Ratios Asset Management Financial Leverage Ratios Profitability RatiosCurrent Ratio Total asset turnover Debt Ratio Gross MarginQuick Ratio Inventory Turnover Equity Ratio EBIT MarginDays Sales in Inventory DebtEquity Ratio Profit MarginReceivables Turnover Equity Multiplier ROADays Sales Outstanding Times Interest Earned ROE Cash Coverage Dividend Payout RatioANALYSIS REQUIREMENTSIOpts PREPARE THE FINANCIAL SCHEDULES using the EXCEL templates. Round to whole number for indices and bps Use decimal place for calculations, use decimal places for other ratios.A INCOME STATEMENT SCHEDULE: pts Year over Year growth s for each income statement item as applicable Common size of sales for each income statement item.o Note: Use of net income for Dividends and Add to RE Makes more sense Common Base Year. Index to base year for each IS item base year Combined. Index to base for each IS item using common size sB BALANCE SHEET SCHEDULE pts Year over Year growth s for each balance sheet item as applicable Common size of assets for each BS item Common Base Year. Index to base year for each BS item base year Combined. Index to base year for each BS item using common size sc FINANCIAL RATIOS SCHEDULE pts Financial ratios for years. Include the change for each applicable year. Calculate the difference or for ratios that are not s calculate the bps change for sD DUPONT IDENTITY ROE ANALYSIS pts: Calculate ROE using the DuPont identitypts ASSESSMENT: Prepare an ANALYSIS using the standardized financial statements and ratios schedules. Discuss the following by looking at trends and comparisons to industry benchmarks. Provide key driver insights and assessments.A EBQI.IAI.LILY: Sales and net income. Growth, dollars, s etc. Gross margins and operating margins. ROE and ROA. Dupont identity key drivers. Retained earnings and their dividend payouts. Etc.B ASSET MANAGEMENT: Inventory metrics. Collections. Asset turnover and drivers. Etc.C SLLIQULQIIY. Current assets and liabilities. Etc.D FNANCIAL LEVERAGE: The use of debt. Interest coverage. Etcpts SUMMARY PARAGRAPHs After completing the schedules and the assessment, what would you convey to management about the company's performance. This is essentially your minute "elevator speech". Limit to paragraphs.Financial Statement Information attached
BACKGROUNDS&S Air, Inc. was founded years ago. The company has manufactured and sold light airplanes over this period, and the company's products have received high reviews for safety and reliability. The company has a niche market in that it sells primarily to individuals who own and fly their own airplanes. The company has two models; the Birdie, which sells for $ and the Eagle, which sells for $ Although the company manufactures aircraft, its operations are different from commercial aircraft companies. S&S Air builds aircraft to order. By using prefabricated parts, the company can complete the manufacture of an airplane in only weeks. The company also receives a deposit on each order, as well as another partial payment before the order is complete. In contrast, a commercial airplane may take h to years to complete once the order is placed.Ratios to Include in AnalysisShort Term Liquidity Ratios Asset Management Financial Leverage Ratios Profitability RatiosCurrent Ratio Total asset turnover Debt Ratio Gross MarginQuick Ratio Inventory Turnover Equity Ratio EBIT MarginDays Sales in Inventory DebtEquity Ratio Profit MarginReceivables Turnover Equity Multiplier ROADays Sales Outstanding Times Interest Earned ROE Cash Coverage Dividend Payout RatioANALYSIS REQUIREMENTSIOpts PREPARE THE FINANCIAL SCHEDULES using the EXCEL templates. Round to whole number for indices and bps Use decimal place for calculations, use decimal places for other ratios.A INCOME STATEMENT SCHEDULE: pts Year over Year growth s for each income statement item as applicable Common size of sales for each income statement item.o Note: Use of net income for Dividends and Add to RE Makes more sense Common Base Year. Index to base year for each IS item base year Combined. Index to base for each IS item using common size sB BALANCE SHEET SCHEDULE pts Year over Year growth s for each balance sheet item as applicable Common size of assets for each BS item Common Base Year. Index to base year for each BS item base year Combined. Index to base year for each BS item using common size sc FINANCIAL RATIOS SCHEDULE pts Financial ratios for years. Include the change for each applicable year. Calculate the difference or for ratios that are not s calculate the bps change for sD DUPONT IDENTITY ROE ANALYSIS pts: Calculate ROE using the DuPont identitypts ASSESSMENT: Prepare an ANALYSIS using the standardized financial statements and ratios schedules. Discuss the following by looking at trends and comparisons to industry benchmarks. Provide key driver insights and assessments.A EBQI.IAI.LILY: Sales and net income. Growth, dollars, s etc. Gross margins and operating margins. ROE and ROA. Dupont identity key drivers. Retained earnings and their dividend payouts. Etc.B ASSET MANAGEMENT: Inventory metrics. Collections. Asset turnover and drivers. Etc.C SLLIQULQIIY. Current assets and liabilities. Etc.D FNANCIAL LEVERAGE: The use of debt. Interest coverage. Etcpts SUMMARY PARAGRAPHs After completing the schedules and the assessment, what would you convey to management about the company's performance. This is essentially your minute "elevator speech". Limit to paragraphs.Financial Statement Information attached
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started