Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please show calculations. 1) Compute sales growth %, COGS growth % and SGA growth % from the three companies below. 2) Prepare three scenarios: best,

Please show calculations.

1) Compute sales growth %, COGS growth % and SGA growth % from the three companies below. 2) Prepare three scenarios: best, worse and normal. For example, given that you have three sales growth numbers for each company, use the the lowest as the worse case, highest as the best case, and the average of all three as the normal case. Do the same for COGS growth and SGA growth. 3) Build the pro forma income statement, and balance sheet for next year. Assume the following: *Straight-Line depreciation is used *10% of the earnings are paid as dividend, the rest are retained *there is no need to buy any new equipment Use 1-3 to answer: How much of additional funds are required next year in the form of equity, to support business growth under best, worse and normal scenarios?

Company 1 Income Statement

image text in transcribed

Company 1 Balance Sheet

image text in transcribed

Company 2 Income Statement

image text in transcribed

Company 2 Balance Sheet

image text in transcribed

Company 3 Income Statement

image text in transcribed

Company 3 Balance Sheet

image text in transcribed

Period Ending Total Revenue Cost of Revenue Gross Profit Dec 31, 2014 22,812,000 6,824,000 15,988,000 Dec 31, 2013 22,120,000 6,450,000 15,670,000 Dec 31, 2012 21,386,000 6,137,000 15,249,000 Operating Expenses Research Development Selling General and Administrative Non Recurring Others 7,760,000 225,000 3,371,000 7,690,000 119,000 3,281,000 7,425,000 115,000 3,264,000 Total Operating Expenses Operating Income or Loss 4,632,000 4,580,000 4,445,000 inuin erations Total Other Income/Expenses Net Earnings Before Interest And Taxes Interest Expense Income Before Tax Income Tax Expense Minority Interest Net Income From Continuing Ops 35,000 4,667,000 1,419,000 3,248,000 1,217,000 11,000 4,591,000 1,552,000 3,039,000 1,085,000 497,000 4,942,000 1,606,000 3,336,000 1,177,000 (4,000) 2,155,000 2,031,000 1,954,000 Non-recurring Events Discontinued Operations Extraordinary Items Effect Of Accounting Changes Other Items Net Income Preferred Stock And Other Adjustments Net Income Applicable To Common Shares 2,031,000 1,954,000 2,155,000 2,031,000 1,954,000 2,155,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Oxford Handbook Of Private Equity

Authors: Douglas Cumming

1st Edition

0195391586, 978-0195391589

More Books

Students also viewed these Finance questions

Question

Define a glocally responsible business.

Answered: 1 week ago