Financial Sta /books/1259708721/ EAertActivity PROBLEM 9 Using Prospective Analysis to Waloe Securities Following are financial statement information for Welmark Corporation as of Year 2 and Year s WELMARK CORPORATION Year 2 Sales growth Net profit margin (Net income/Sales) 850% 6.71% Year 3 1065% 822% Net working capital turnover (Sales/Average net working capital)... 898 1.64 2.01 1737 1737 Fixed asset turnover (Sales/Average faed assets). 1.96 Number of shares outstanding ($ thousands Sales Net income Net working capital. Ftxed assets Total operating assets. . Long-term liabilities . .. Total stockholders' equity .. $5423 $28.131 1,706 2,312 2,832 3,015 15232 17136 18,064 20,151 8832 10132 9,232 10,019 Required Using the ressdual income model, prepare a valuaticn of the common stock of Welmark Corporation as of Year 3 under the Sollowing assumptices Forecast horton of five years Sales growth of 10 65% per year over the forecast borice and 3.5% thereafter c All financial ratios remain at Year 3 Des els d Cost ofequry capital is 125% arailable for the preparation of Trlact's va roont PROBLEM9-5A Preparing Pro Forma Financital Statement Telaet Corporation is a newty formed computer marufacturer Telnet plans to begin operaticns ce ansary 1,Year 2. Selected fisancial infomatice i Out forecasted nerformance covemns the neriod Tammany 1 to rome 10 of Year