For year ended December 31, 2009, the Saxton Company generated $ 8,000,000 in Sales and a total of $ 2,000,000 in Gross Profit Selling and Administrative Expenses totaled $ 900,000, and the firm incurred an Extra Ordinary Loss of $ 400,000 Earnings Before Taxes totaled $ 600,000 and Income Taxes totaled 1 3 of Pre Tax Income Based upon this scenario, please present an Income Statement for the Saxton Company For the Saxton Company referenced in 1, year end Cash totaled $ 60,000 A R totaled $ 700,000, and Marketable Securities totaled $ 100,000 Inventory totaled $ 740,000 and Net Plant and Equipment totaled $ 1,600,000 Accounts Payable (A P) totaled 100,000 and Short Term Notes Payable totaled $ 500,000 Total Long Term Liabilities was $ 600,000, and Owners Equity consisted of 40 Common Stock and the balance in (Accumulated) Retained Earnings Based upon all information available, please present a Balance Sheet for the Saxton Company Based upon all information available, please present a Vertical Analysis Income Statement for the Saxton Company Based upon all information available, please present a Vertical Analysis Balance Sheet for Saxton Company Based upon all information available, please provide financial ratio analysis based on each of the four (4) key categories of financial ratios discussed in class Then provide DuPont Analysis as appropriate, including both ways by which DuPont analysis can be done for ROE Based upon all information available, please compute the Weighted Average Cost of Capital for the Saxton Company Please describe what your WACC figure means If a potential investment has an Expected Rate of Return of 16 , would this potential investment be pursued using ROE as a Required Rate of Return Why or why not If a potential investment has an Expected Rate of Return of 16 , should this investment be pursued using WACC as a Required Rate of Return Why or why not Using Net Income as a Perpetuity, please determine a value for the entity (a ) based on your WACC, then (b ) based on your ROE

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Posted on Oct 05, 2024

For year ended December 31, 2009, the Saxton Company generated $ 8,000,000 in Sales and a total of $ 2,000,000 in Gross Profit. Selling and Administrative Expenses totaled $ 900,000, and the firm incurred an Extra-Ordinary Loss of $ 400,000. Earnings Before Taxes totaled $ 600,000 and Income Taxes totaled 1/3 of Pre-Tax Income. Based upon this scenario, please present an Income Statement for the Saxton Company.

For the Saxton Company referenced in # 1, year-end Cash totaled $ 60,000. A/R totaled $ 700,000, and Marketable Securities totaled $ 100,000. Inventory totaled $ 740,000 and Net Plant and Equipment totaled $ 1,600,000. Accounts Payable (A/P) totaled 100,000 and Short Term Notes Payable totaled $ 500,000. Total Long Term Liabilities was $ 600,000, and Owners Equity consisted of 40% Common Stock and the balance in (Accumulated) Retained Earnings. Based upon all information available, please present a Balance Sheet for the Saxton Company.

Based upon all information available, please present a Vertical Analysis Income Statement for the Saxton Company.

Based upon all information available, please present a Vertical Analysis Balance Sheet for Saxton Company.

Based upon all information available, please provide financial ratio analysis based on each of the four (4) key categories of financial ratios discussed in class. Then provide DuPont Analysis as appropriate, including both ways by which DuPont analysis can be done for ROE.

Based upon all information available, please compute the Weighted Average Cost of Capital for the Saxton Company.

If a potential investment has an Expected Rate of Return of 16%, would this potential investment be pursued using ROE as a % Required Rate of Return ? Why or why not ?

If a potential investment has an Expected Rate of Return of 16%, should this investment be pursued using WACC as a % Required Rate of Return ? Why or why not ?