Name:

1.Two years of financial statement data for the Berlin Export Corporation are shown below.

BERLIN EXPORTS CORPORATION

Balance Sheet 2012 2013

Cash $50,000 $50,000

Accounts Receivables 200,000 300,000

Inventories 450,000 570,000

Total Current Assets 700,000 920,000

Fixed Assets, Net 300,000 380,000

Total Assets $1,000,000 $1,300,000

Accounts Payable 130,000 $180,000

Accruals 50,000 70,000

Bank Loan 90,000 90,000

Total Current Liabilities 270,000 340,000

Long-Term Debt 400,000 550,000

Common Stock ($.05 par) 50,000 50,000

Additional Paid-in-Capital 200,000 200,000

Retained Earnings 80,000 160,000

Total Liab. & Equity $1,000,000 $1,300,000

Income Statement 2012 2013

Net Sales $1,300,000 $1,600,000

Cost of Goods Sold 780,000 960,000

Gross Profit 520,000 640,000

Marketing 130,000 160,000

General & Administrative 150,000 150,000

Depreciation 40,000 55,000

EBIT 200,000 275,000

Interest 45,000 55,000

Earnings Before Taxes 155,000 220,000

Income Taxes (40% rate) 62,000 88,000

Net Income $93,000 $132,000

1. Estimate Berlins EBDAT breakeven in terms of survival revenues.

.

2. Estimate the dollar amount of survival revenues actually needed by the Berlin Products Company to reach EBDAT breakeven in 2013 given that more debt was obtained, and interest expenses increased to $55,000.

3. Use year-end data to calculate the current ratio, the quick ratio, and the net working capital (NWC) to total assets ratio for 2012 and 2013 for the Berlin Company. What changes occurred?

6. Determine the rate of return on assets in each of the two years for the Berlin Products.

G. Calculate the inventory-to-sale, sale-to-cash, and purchase-to-payment conversion periods for Berlin Exports for 2013.

Inventory-to-Sale Conversion Period =

Sale-to-Cash Conversion Period =

Purchase-to-Payment Conversion Period =

H. Calculate the length of Berlin Exports cash conversion cycle for 2013.

Cash Conversion Cycle =