CASE 5.3

1. Calculate the z-score for all years:

Year 14 159 Year 13 583 Year 12 313 Year 10 753 Year 9 192 Year 11 142 1,000 1,490 602 57 6,545 5,106 665 4,874 2,514 829 Balance Sheet ASSETS Cash Notes Receivable Accounts recievable Inventories Prepayments Net assets of discontinued business Total Current Assets Property Plant and Equipment Less accumulated depreciation Net assets of discontinued business Other assets Total Assets 2,675 1,552 469 1. Calaculate 2-scores for all years Z-Score Table A = net working capital / total assets B = retained earnings / total assets C = EBIT / total assets D = market value of equity / total liabilities E = sales / total assets E Z-score = 1.2A +1.4B + 3.3C + 0.6D + 1E 12,475 106,529 (17,231) 89,298 470 102.243 3,301 8,800 76,975 (8,843) 68,132 665 77,597 5,009 24,039 (5,713) 18,326 641 23,976 1,083 2,036 642 686 303 387 1,926 26 4,707 37,250 17,471 (4,462) (2,593) 32,788 14,878 1,566 1,278 39,061 19,457 3,291 17,809 (4,288) 13,521 1,112 17,924 12,428 1,436 60,590 6,279 945 7,018 12,124 26,366 41,021 900 12,903 1.239 435 939 1,021 1,104 1,310 4,374 6,738 85,921 3.110 993 140 1,789 2,423 5,345 9,804 803 OUS 226 16,178 21 4,569 3,208 LIABILITIES AND SHAREHOLDERS EQUITY Accounts Payable Notes Payable Current portion of long-term debt Other curent liabilities Total Current Liabilites Long term debt Deffered income taxes Other noncurrent liabilities Total Liabilities Common stock Additional paid-in capital Retained earnings Treasury stock Total Shareholders Equity Total liabilities and Sharehlders Equity 2,285 4,766 2,774 1,845 11,670 20,041 1,322 248 33,281 20 3,611 2,149 9,060 1,412 85,921 34 16,516 (29) (199) 16,322 102,243 68,287 22 5,685 3,802 (199) 9,310 77,597 11,112 20 4,323 2,469 13,582 20 3,611 2,244 7,798 23,976 6,812 17,924 5,780 39,061 5,875 19,457 Company Shares outstanding Share price (High Bid) 3358 16.50 2223 14.63 2095 11.25 2000 4.63 2000 5.25 Year 14 54,988 Year 13 36,597 Year 12 20,758 Year 11 19,266 Year 10 31,992 Income Statemet CONTINUING OPREATIONS Sales wards EXPENSES Cost of services Selling and administrative Depreciation Interest Income taxes Total Expenses Income - continuing operations Income - discontinued operations Net Income 38,187 5,880 9,810 5,841 (900) 58,818 (3,830) 26,444 3,020 3,150 3,058 379 36,051 546 47 593 12,544 3,467 1,703 1,101 803 9,087 2,989 2,798 2,743 671 18,288 978 (659) 319 22,003 4,236 3,003 2,600 74 31,916 76 (171) (95) 19,618 1,140 (400) 740 (3,830) Year 14 159 Year 13 583 Year 12 313 Year 10 753 Year 9 192 Year 11 142 1,000 1,490 602 57 6,545 5,106 665 4,874 2,514 829 Balance Sheet ASSETS Cash Notes Receivable Accounts recievable Inventories Prepayments Net assets of discontinued business Total Current Assets Property Plant and Equipment Less accumulated depreciation Net assets of discontinued business Other assets Total Assets 2,675 1,552 469 1. Calaculate 2-scores for all years Z-Score Table A = net working capital / total assets B = retained earnings / total assets C = EBIT / total assets D = market value of equity / total liabilities E = sales / total assets E Z-score = 1.2A +1.4B + 3.3C + 0.6D + 1E 12,475 106,529 (17,231) 89,298 470 102.243 3,301 8,800 76,975 (8,843) 68,132 665 77,597 5,009 24,039 (5,713) 18,326 641 23,976 1,083 2,036 642 686 303 387 1,926 26 4,707 37,250 17,471 (4,462) (2,593) 32,788 14,878 1,566 1,278 39,061 19,457 3,291 17,809 (4,288) 13,521 1,112 17,924 12,428 1,436 60,590 6,279 945 7,018 12,124 26,366 41,021 900 12,903 1.239 435 939 1,021 1,104 1,310 4,374 6,738 85,921 3.110 993 140 1,789 2,423 5,345 9,804 803 OUS 226 16,178 21 4,569 3,208 LIABILITIES AND SHAREHOLDERS EQUITY Accounts Payable Notes Payable Current portion of long-term debt Other curent liabilities Total Current Liabilites Long term debt Deffered income taxes Other noncurrent liabilities Total Liabilities Common stock Additional paid-in capital Retained earnings Treasury stock Total Shareholders Equity Total liabilities and Sharehlders Equity 2,285 4,766 2,774 1,845 11,670 20,041 1,322 248 33,281 20 3,611 2,149 9,060 1,412 85,921 34 16,516 (29) (199) 16,322 102,243 68,287 22 5,685 3,802 (199) 9,310 77,597 11,112 20 4,323 2,469 13,582 20 3,611 2,244 7,798 23,976 6,812 17,924 5,780 39,061 5,875 19,457 Company Shares outstanding Share price (High Bid) 3358 16.50 2223 14.63 2095 11.25 2000 4.63 2000 5.25 Year 14 54,988 Year 13 36,597 Year 12 20,758 Year 11 19,266 Year 10 31,992 Income Statemet CONTINUING OPREATIONS Sales wards EXPENSES Cost of services Selling and administrative Depreciation Interest Income taxes Total Expenses Income - continuing operations Income - discontinued operations Net Income 38,187 5,880 9,810 5,841 (900) 58,818 (3,830) 26,444 3,020 3,150 3,058 379 36,051 546 47 593 12,544 3,467 1,703 1,101 803 9,087 2,989 2,798 2,743 671 18,288 978 (659) 319 22,003 4,236 3,003 2,600 74 31,916 76 (171) (95) 19,618 1,140 (400) 740 (3,830)