Familytex (BD) Limited

Income statement

December 31, 2018

BDT. (Million)

Sales Revenue ..................................................................1,700

Less: COGS............................................................1,000

Gross Profit700

Less: Operating expenses

Selling expenses70

General and administrative expenses120

Lease expenses40

Depreciation expense100

Total operating expense330

EBIT.........................................370

Less: Interest expense70

EBT300

Less: Tax rate (40%)120

Net profit after Tax180

Less: Preferred stock dividend10

Earnings available for common stockholders170

Earnings per shareTk. 1.70

BALANCE SHEETDecember 17December18 18(Million BDT)

Fixed Assets:

Plant and Equipment14501570

Land and building820870

Furniture and vehicles 350380

Investment - Long Term5030

Less: Accumulated Depreciation13001400

Net Fixed assets13701450

Current Assets:

Cash300450

Inventories600750

Account Receivable500400

Advances, Deposits and Prepayments4050

Investment in Marketable Securities250350

Total current assets16902000

TOTAL ASSETS30603450 SHAREHOLDERS' EQUITY AND LIABILITIES:

Shareholders' Equity:

Preferred stock100100

Common stock: Tk. 10 par 100,000 shares 10001000

Share Premium400500

Retained Earnings100120

Long-term Liabilities:

Long Term Loans 600700

Current Liabilities:

Short Term Bank Loans200275

Accounts payable300450

Notes Payable210170

Accruals150135

TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 3060 3 450(BDT.)

Question: 1

(4+3+3)

a. Calculate and interpret the following ratio for 2017 &18: Current ratio, Fixed assets turnover, TIE ratio, ROA, DSO, OPM, ROI (any Four).

b. Differentiate between direct and indirect transfer of fund with diagram and examples considering Bangladeshi financial markets and institutions.

c. Meghna cement has posted EBT for the year ended 2019, was 70,9000800 (BDT), and already this company paid BDT 20,50600 in advance for tax purpose. Meghna cement has earned BDT 640,000 as dividend income holding 32% of ACI stock and BDT 430,000 interest from BRAC bond. The corporate tax rate is 38%. Calculate the total tax obligation for this company for the year ended 2019 and adjusting prepayment how much Meghna cement has to pay the NBR.

Question: 2

(4+2.5+3.5)

a. Differentiate between spot versus future market, corporate charter versus bylaws with examples.

b. Explain the major objectives and limitations of fundamental analysis and differentiate between ordinary and extra ordinary income with example.

c. Derive the Du Pont system to show ROE calculate of the Family Textile ltd. Would you prefer Du Pont system for ROE calculation, justify your answer.