Entrepreneurial Finance 6th Edition Leach/Melicher Part 7 Capstone Cases Case 1: Eco- Products, Inc. (pages 617-634) Questions D,E, & G. (Data Analysis/Preparation)

D. Tables 2 and 3 present Eco-Products' financial statement information for 2005, 2006, and 2007. Prepare a ratio analysis of the firm's financial performance over the 2005-2007 period.

E. Table 4 presents Eco-Products' statement of cash flows for 2007. Was the firm building or burning cash in its operating activities? When also considering cash flows from investing activities, was Eco-Products in a net cash build or burn position in 2007

G. In mid-2007, Eco-Products management prepared a five-year (2007-2011) projection of revenues and expenses (see Table 1). What annual rates of growth were projected for net sales? Make a "back-of-the-envelope" estimate of the amounts of additional assets needed to support the sales forecasts. How might these assets be financed? Prepare a "rough" estimate of the possible size of external financing needed to support these sales projections

Table 2

Table 3

Table 4

Consolidated Income statement Net Revenue COGS Gross Profit Operating Expenses Sales and Marketing General and Administrative Depreciation Total Operating Expenses Operating Profit Other Income and (Expenses) Interest Expense Other Expense Net Other Income and (Expenses) Less Provision for Income Taxes Net Income (loss) 2005 3,649,799 1,065,473 129,175 644,677 52,102 825,954 239,519 (15.671) 13,488 U2183) 0 237,336 2007 2006 5,751,787 10,867,104 7,726,455 3,684,492 2,067,295 3,140,649 1,822,206 1,264,449 680,013 1,102,437 87,563 24,500 1,968,962 3,012,206 98,333 128,443 (35,196) (186,726) 01 1192 (35,196) (187,918) 21,191 (23,276) (36,199) 41,946