EN FIN B281F 2020 Autumn Assignm... the The 11:24 EM They are to become your capital/ Vfirmind planning to acquirente. As Der Weg Tume your fem your bly the Alphus Corporation WA Ta Te Og med 2. Writing report - In the written report, your team should include the followings: (a) Comment the performance of the two companies during 2015 to 2016 (48 marks) from four perspectives (liquidity, profitability, finance and return on shareholders' investment) based on the calculation of the following financial ratios: 1. Current ratio 2. Acid-test ratio 3. Average collection period 4. Account receivable turnover 5. Inventory turnover 6. Operating income return on investment 7. Gross profit margin 8. Operating profit margin 9. Total asset tumover 10. Fixed asset turnover 11. Total debt ratio 12. Times interest earned 13. Return on equity 71.9 2019 $4,633.25 2,789.53 $1,843.72 1.552.94 68.7 $222.08 79.88 -1.6 99.06 $44.74 36.47 58.27 67.1 2019 Alpha Corporation Income Statement (S thousands) Year ended 31 December 2015 2016 2017 2018 Sales $5.561.49 55,558.30 $5,821.91 $5,152.49 Cost of goods sold 3.329.95 3,367.89 3.602.75 3.188.95 Gross Profit $2.231.94 $2.190.41 52.219.16 $1.963.54 Selling & administrative expensive 1.597.67 1.703.12 1.707.91 1.666.37 Depreciation 55.92 63.91 68.7 Operating profit $57835 S423.38 S442.55 $225.27 Interest Expense 41.54 102.25 97.46 Non-operating income (-/expense -15.98 -23.97 -7.99 12.78 Special Items 115.03 0 92.66 55.92 Earnings before taxes S437.76 $380.25 $255.63 $59.11 Income Taxes 175.54 150.18 30.35 41.71 Net income $260.42 $230,07 $225.28 $17.40 Balance Sheet (5 thousands) 31 December 2015 2016 2017 2018 Assets Cash and equivalents $127.81 $369.86 $335.51 $287.58 Account receivables 810.02 943.42 897.89 827.59 Inventories 1,014.52 870.73 901.09 854.75 Other current assets 193.32 15318 2077 2061 Total current assets $2.145.67 $2.337.39 $2,342.19 $2.176.02 Gross plant, property and cquipment 536.82 570.37 $65.58 637.47 less: Accumulated depreciation 230.06 2748 314.74 361.07 Net plant, property and equipment $306.76 $295.57 S250.84 $276.40 Other assets 193.32 220.48 214.07 32753 Total assets $2.645.75 $2,853.44 $2.807.10 $2.779.95 Liabilities Current portion of long-term deht $1.60 $84.68 $193.32 S139.00 Notes payable 106.25 52.72 65.5 76.69 Accounts payable 264.41 313.14 306.75 324 33 Taxes payable 76.69 105.45 6.39 132.61 Other current liabilities 241.25 270.01 349 29 306.75 Total current liabilities $690.20 5826,00 S921.85 5979.38 Long-term debt 405.81 1,364.41 1,020.91 885.11 Other liabilities 5752 5432 5113 51.11 Total Liabilities S1.153.53 $2.244.73 $1.993.89 $1.915.62 Equity Common stock 563.91 $1.60 $1.60 $24.76 Retained earnings 2,391.71 1,594.48 1.795.78 1.822.94 less treasury stock 96340 98737 98417 98737 Common equity $1.492.22 $608.71 $81321 586433 Total liabilities & equity $2.645.75 $2.853.44 $2.07.10 52.779.95 S450.54 666.23 663.03 2061 $1.985.90 674.22 389 3 S284.39 228.47 $2.498.76 $295.57 44.73 246,04 12.78 397.82 $996.94 591.14 65,5 $1,653.58 $1.60 1.830.94 987436 $845.18 $2.498.76 Omega Limited: Income Statement (S thousands) Year ended 31 December 2015 2016 2017 Sales Sb.15.1 59.263.91 $13,152.13 Cost of goods sold 4,016.22 5.475.89 7.680 56 Gross Profit $2,798.93 $3,788.02 $5.471.59 Selling & administrative expensive 1.732.24 2.275.39 3.298.42 Depreciation 120.25 170.36 226.19 Operating profit 5946.44 $1,342.27 $1.946,98 Interest Expense 34.36 57.26 78.74 Non-operating income () expense -34.36 -1.43 -11.45 Special Items 15.75 0 25.77 Earings before taxes $930.69 SI,286.44 51.853.92 Income Taxes 3579 495.34 714.37 Net income $572.79 $791.10 S1.139.55 2018 S13,676,12 8,419.27 55.256.85 3.756.53 292.05 $1.208.27 95.92 -7.16 186.11 5933.40 3622 5571.20 2019 312,365.20 7580 35 S4,984.85 3.474.50 312.09 S1.198.26 73.01 14.32 42.95 $1.067.98 42232 S645.66 2018 2019 S156.04 2.396.51 1.999.95 280.59 224.76 $5.057.85 2.605.52 954.88 $1,650,64 624.19 395.12 572727.80 S283.46 2.227.58 1.716.49 273.44 173.22 $4,674,19 2.864.64 1.053 66 51.810.98 611.29 415.17 57.311.63 Balance Sheet (s thousands) 31 December 2015 2016 2017 Assets Cash and equivalents S309.23 5375.0 S637.06 Account receivables 1.507.48 1.926.94 2,511.03 Inventories 901.91 1,332.82 1.916.92 Prepaid expenses 105.94 134.57 224.76 Other current assets 104.51 133.14 194.7 Total current assets $2,929.07 $3.902.35 $5,484.47 Gross plant, property and equipment 1.275,56 1.500.32 2,041.47 less: Accumulated depreciation 48102 578.37 720.1 Net plant, property and equipment $794.54 $921.95 $1,321.37 Intangibles-patents 710.08 680.02 664.27 Other assets 655 151.75 206.15 Total assets $4,499.54 $5,656.27 $7.676.26 Liabilities Current portion of long-term debt 545.81 S10.02 52.86 Notes payable 568.35 637.06 791.68 Accounts payable 426,62 651.38 983.51 Taxes payable 51.54 113.1 77.31 Accrued expenses 4939 687.17 817.45 Total current liabilities S1.586.22 $2,098.73 $2,672.81 Long-term debt 15.75 14.32 423.76 Deferred taxes 25.77 2.86 7.16 Other liabilities 60.13 58.7 $2.97 Total Liabilities S1.687.86 $2.174.61 $3.156.69 Equity Common stock $4.29 54.29 54.29 Capital surplus 174.67 221.9 302.07 Retained earnings 2,632.72 3.255.47 4.21321 Common equity $2.811.68 $3,481.66 S4,519,57 Total liabilities & equity $4,499.54 55.656 27 $7,676.26 52.86 687.17 837.49 41.52 871.85 S2.440.89 542.58 0 74.44 $3,057.91 $1.43 599.84 $33.99 0 936.27 $2,071.53 552.6 0 11453 52,738,66 $4.29 376.51 4.289.09 $4,669.89 S7.727.80 $4.29 478.16 4.290.52 54,272.97 $7,511.63 EN FIN B281F 2020 Autumn Assignm... the The 11:24 EM They are to become your capital/ Vfirmind planning to acquirente. As Der Weg Tume your fem your bly the Alphus Corporation WA Ta Te Og med 2. Writing report - In the written report, your team should include the followings: (a) Comment the performance of the two companies during 2015 to 2016 (48 marks) from four perspectives (liquidity, profitability, finance and return on shareholders' investment) based on the calculation of the following financial ratios: 1. Current ratio 2. Acid-test ratio 3. Average collection period 4. Account receivable turnover 5. Inventory turnover 6. Operating income return on investment 7. Gross profit margin 8. Operating profit margin 9. Total asset tumover 10. Fixed asset turnover 11. Total debt ratio 12. Times interest earned 13. Return on equity 71.9 2019 $4,633.25 2,789.53 $1,843.72 1.552.94 68.7 $222.08 79.88 -1.6 99.06 $44.74 36.47 58.27 67.1 2019 Alpha Corporation Income Statement (S thousands) Year ended 31 December 2015 2016 2017 2018 Sales $5.561.49 55,558.30 $5,821.91 $5,152.49 Cost of goods sold 3.329.95 3,367.89 3.602.75 3.188.95 Gross Profit $2.231.94 $2.190.41 52.219.16 $1.963.54 Selling & administrative expensive 1.597.67 1.703.12 1.707.91 1.666.37 Depreciation 55.92 63.91 68.7 Operating profit $57835 S423.38 S442.55 $225.27 Interest Expense 41.54 102.25 97.46 Non-operating income (-/expense -15.98 -23.97 -7.99 12.78 Special Items 115.03 0 92.66 55.92 Earnings before taxes S437.76 $380.25 $255.63 $59.11 Income Taxes 175.54 150.18 30.35 41.71 Net income $260.42 $230,07 $225.28 $17.40 Balance Sheet (5 thousands) 31 December 2015 2016 2017 2018 Assets Cash and equivalents $127.81 $369.86 $335.51 $287.58 Account receivables 810.02 943.42 897.89 827.59 Inventories 1,014.52 870.73 901.09 854.75 Other current assets 193.32 15318 2077 2061 Total current assets $2.145.67 $2.337.39 $2,342.19 $2.176.02 Gross plant, property and cquipment 536.82 570.37 $65.58 637.47 less: Accumulated depreciation 230.06 2748 314.74 361.07 Net plant, property and equipment $306.76 $295.57 S250.84 $276.40 Other assets 193.32 220.48 214.07 32753 Total assets $2.645.75 $2,853.44 $2.807.10 $2.779.95 Liabilities Current portion of long-term deht $1.60 $84.68 $193.32 S139.00 Notes payable 106.25 52.72 65.5 76.69 Accounts payable 264.41 313.14 306.75 324 33 Taxes payable 76.69 105.45 6.39 132.61 Other current liabilities 241.25 270.01 349 29 306.75 Total current liabilities $690.20 5826,00 S921.85 5979.38 Long-term debt 405.81 1,364.41 1,020.91 885.11 Other liabilities 5752 5432 5113 51.11 Total Liabilities S1.153.53 $2.244.73 $1.993.89 $1.915.62 Equity Common stock 563.91 $1.60 $1.60 $24.76 Retained earnings 2,391.71 1,594.48 1.795.78 1.822.94 less treasury stock 96340 98737 98417 98737 Common equity $1.492.22 $608.71 $81321 586433 Total liabilities & equity $2.645.75 $2.853.44 $2.07.10 52.779.95 S450.54 666.23 663.03 2061 $1.985.90 674.22 389 3 S284.39 228.47 $2.498.76 $295.57 44.73 246,04 12.78 397.82 $996.94 591.14 65,5 $1,653.58 $1.60 1.830.94 987436 $845.18 $2.498.76 Omega Limited: Income Statement (S thousands) Year ended 31 December 2015 2016 2017 Sales Sb.15.1 59.263.91 $13,152.13 Cost of goods sold 4,016.22 5.475.89 7.680 56 Gross Profit $2,798.93 $3,788.02 $5.471.59 Selling & administrative expensive 1.732.24 2.275.39 3.298.42 Depreciation 120.25 170.36 226.19 Operating profit 5946.44 $1,342.27 $1.946,98 Interest Expense 34.36 57.26 78.74 Non-operating income () expense -34.36 -1.43 -11.45 Special Items 15.75 0 25.77 Earings before taxes $930.69 SI,286.44 51.853.92 Income Taxes 3579 495.34 714.37 Net income $572.79 $791.10 S1.139.55 2018 S13,676,12 8,419.27 55.256.85 3.756.53 292.05 $1.208.27 95.92 -7.16 186.11 5933.40 3622 5571.20 2019 312,365.20 7580 35 S4,984.85 3.474.50 312.09 S1.198.26 73.01 14.32 42.95 $1.067.98 42232 S645.66 2018 2019 S156.04 2.396.51 1.999.95 280.59 224.76 $5.057.85 2.605.52 954.88 $1,650,64 624.19 395.12 572727.80 S283.46 2.227.58 1.716.49 273.44 173.22 $4,674,19 2.864.64 1.053 66 51.810.98 611.29 415.17 57.311.63 Balance Sheet (s thousands) 31 December 2015 2016 2017 Assets Cash and equivalents S309.23 5375.0 S637.06 Account receivables 1.507.48 1.926.94 2,511.03 Inventories 901.91 1,332.82 1.916.92 Prepaid expenses 105.94 134.57 224.76 Other current assets 104.51 133.14 194.7 Total current assets $2,929.07 $3.902.35 $5,484.47 Gross plant, property and equipment 1.275,56 1.500.32 2,041.47 less: Accumulated depreciation 48102 578.37 720.1 Net plant, property and equipment $794.54 $921.95 $1,321.37 Intangibles-patents 710.08 680.02 664.27 Other assets 655 151.75 206.15 Total assets $4,499.54 $5,656.27 $7.676.26 Liabilities Current portion of long-term debt 545.81 S10.02 52.86 Notes payable 568.35 637.06 791.68 Accounts payable 426,62 651.38 983.51 Taxes payable 51.54 113.1 77.31 Accrued expenses 4939 687.17 817.45 Total current liabilities S1.586.22 $2,098.73 $2,672.81 Long-term debt 15.75 14.32 423.76 Deferred taxes 25.77 2.86 7.16 Other liabilities 60.13 58.7 $2.97 Total Liabilities S1.687.86 $2.174.61 $3.156.69 Equity Common stock $4.29 54.29 54.29 Capital surplus 174.67 221.9 302.07 Retained earnings 2,632.72 3.255.47 4.21321 Common equity $2.811.68 $3,481.66 S4,519,57 Total liabilities & equity $4,499.54 55.656 27 $7,676.26 52.86 687.17 837.49 41.52 871.85 S2.440.89 542.58 0 74.44 $3,057.91 $1.43 599.84 $33.99 0 936.27 $2,071.53 552.6 0 11453 52,738,66 $4.29 376.51 4.289.09 $4,669.89 S7.727.80 $4.29 478.16 4.290.52 54,272.97 $7,511.63