Question
Here is the question and I would like you to put the answers down according the the letter it goes with... For example, if the
Here is the question and I would like you to put the answers down according the the letter it goes with... For example, if the question is under number one please make sure you put the answer under number one.
1 You're the chief financial officer (CFO) of Worldwide Widget Manufacturing, Inc. The company manufactures and sells widgets at factories in the United States and internationally. Listed below are partial financial statements for Worldwide Widget Manufacturing, Inc. Fill in the missing information in each of the following financial statements. Answer spaces are given below.
Worldwide Widget Manufacturing, Inc. Balance Sheet as of December 31, 2019, and 2018 (in millions of dollars) | |||||
---|---|---|---|---|---|
2019 | 2018 | 2019 | 2018 | ||
Assets | Liabilities and Equity | ||||
Current assets: | Current liabilities: | ||||
Cash and marketable securities | $427 | $322 | Accrued wages and taxes | $309 | $257 |
Accounts receivable | a. ? | 259 | Accounts payable | 381 | b. ? |
Inventory | 815 | 797 | Notes payable | $492 | $421 |
Total | $1,542 | $1,378 | Total | $1,182 | $997 |
Fixed assets: | Long-term debt: | 1,934 | c. ? | ||
Gross plant and equipment | d. ? | $2,817 | Total | 3,116 | 2,956 |
Less: Depreciation | 368 | 254 | Stockholders' equity: | ||
Net plant and equipment | $2,872 | $2,563 | Preferred stock (30 million shares) | $30 | $30 |
Other long-term assets | 521 | 487 | Common stock and paid-in surplus (250 million shares) | 300 | e. ? |
Retained earnings | 1,489 | 1,142 | |||
Total FA | f. ? | $3,050 | Total Equity | $1,819 | $1,472 |
Total assets | $4,935 | $4,428 | Total liabilities and equity | $4,935 | $4,428 |
A. Accounts receivable for 2019 ________
B. Accounts payable for 2018 ________
C. Long-term debt for 2018 ________
D. Gross plant and equipment for 2019 ________
E. Common stock and paid-in surplus (250 million shares) for 2018 ________
F. Total FA for 2019 ________
Worldwide Widget Manufacturing, Inc. Income Statement for Years Ending December 31, 2019, and 2018 (in millions of dollars) | ||
---|---|---|
2019 | 2018 | |
Net sales | g. ? | $2,018 |
Less: Cost of goods sold | 753 | h. ? |
Gross profits | $1,623 | $1,189 |
Less: Other operating expenses | 423 | 167 |
Earnings before interest, taxes, depreciation, and amortization (EBITDA) | $1,200 | $1,022 |
Less: Depreciation | 114 | 114 |
Earnings before interest and taxes (EBIT) | $1,086 | $ 908 |
Less: Interest | i. ? | 128 |
Earnings before taxes (EBT) | $949 | $780 |
Less: Taxes | j. ? | 234 |
Net income | $664 | $546 |
Less: Preferred stock dividends | 98 | 98 |
Net income available to common stockholders | $566 | $448 |
Less: Common stock dividends | 219 | 199 |
Addition to retained earnings | $347 | $249 |
Per (common) share data: | ||
Earnings per share (EPS) | k. ? | $1.79 |
Dividends per share (DPS) | $0.88 | l. ? |
Book value per share (BVPS) | m. ? | $5.77 |
Market value per share (MVPS) | $23.97 | $22.47 |
G. Net sales for 2019 ________
H. Less: Cost of goods sold for 2018 ________
I. Less: Interest for 2019 ________
J. Less: Taxes for 2019 ________
K. Earnings per share (EPS) for 2019 ________
L. Dividends per share (DPS) for 2018 ________
M. Book value per share (BVPS) for 2019 ________
Worldwide Widget Manufacturing, Inc. Statement of Cash Flows for Year Ending December 31, 2019 (in millions of dollars) | |
---|---|
Section A. Cash flows from operating activities | |
Net income | n. ? |
Additions (sources of cash): | |
Depreciation | 114 |
Increase in accrued wages and taxes | o. ? |
Increase in accounts payable | 62 |
Subtractions (uses of cash): | |
Increase in accounts receivable | -41 |
Increase in inventory | p. ? |
Net cash flow from operating activities | q. ? |
Section B. Cash flows from investing activities | |
Subtractions: | |
Increase in fixed assets | -$343 |
Increase in other long-term assets | r. ? |
Net cash flow from investing activities: | s. ? |
Section C. Cash flows from financing activities | |
Additions: | |
Increase in notes payable | t. ? |
Increase in common and preferred stock | 0 |
Subtractions: | |
Decrease in long-term debt | -25 |
Pay dividends | u. ? |
Net cash flow from financing activities: | v. ? |
Section D. Net change in cash and marketable securities | $105 |
N. Net income ________
O. Increase in accrued wages and taxes ________
P. Increase in inventory ________
Q. Net cash flow from operating activities ________
R. Increase in other long-term assets ________
S. Net cash flow from investing activities ________
T. Increase in notes payable ________
U. Pay dividends ________
V. Net cash flow from financing activities ________
Worldwide Widget Manufacturing, Inc. Statement of Retained Earnings as of December 31, 2019 (in millions of dollars) | ||
---|---|---|
Balance of retained earnings, December 31, 2018 | $1,142 | |
Plus: Net income for 2019 | w. ? | |
Preferred stock | x. ? | |
Common stock | 219 | |
Total cash dividends paid | 317 | |
Balance of retained earnings, December 31, 2019 | $1,489 |
W. Plus: Net income for 2019________
X. Preferred stock ________
2. For each of the items listed below indicate on which of the major statements they would be found (1, 2, 3, or 4) and the amount shown on the statements above:
1. Balance sheet | 3. Statement of cash flows |
2. Income statement | 4. Statement of retained earnings |
- Earnings before taxes for 2019 ________; $________
- Gross plant and equipment for 2019 ________; $________
- Increase in fixed assets, December 31, 2019 ________; $________
- Net sales for 2019 ________; $________
- Balance of retained earnings, December 31, 2019 ________; $________
- Common stock and paid-in surplus for 2018 ________; $________
- Net cash flow from investing activities, December 31, 2019 ________; $________
- Increase in inventory, December 31, 2019 ________; $________
- Accrued wages and taxes for 2018 ________; $________
- Book value per share (BVPS) for 2019 ________; $________
3. You'll need to compare your company's ratios with the industry's standards.
Worldwide Widget Manufacturing, Inc. | |||
---|---|---|---|
Company | Industry | Comparison | |
Current ratio | 2.2 times | ||
Quick ratio | 1.1 times | ||
Cash ratio | 0.35 times | ||
Inventory turnover | 2 times or 1 time | ||
Days' sales in inventory | 135 days or 335 days | ||
Average payment period | 110 days | ||
Sales to working capital | 3 times | ||
Total asset turnover | 0.6 times | ||
Debt-to-equity | 1.1 times | ||
Profit margin | 16.5% | ||
Gross profit margin | 48.13% | ||
ROA | 8.78% | ||
ROE | 19.45% | ||
Dividend payout | 32% |
- Use the information found in Worldwide Widget Manufacturing's financial statements to calculate all of the listed financial ratios in the above table for your company. Then, for each ratio, provide a comparison of the company's result with the industry standards, indicating if your company's results are lower than, higher than, slower than, or faster than the industry standards.
- Calculate your company's internal and sustainable growth rates.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started