Rottweiler Riggings Company 2018 Financial Statements

Income Statement

Sales $980,760

Costs $792,960

Other Expenses $20,060

EBIT $167,740

Interest Paid $14,740

Taxable Income $153,000

Taxes (21%) $32,130

Net Income $120,870

Dividends Paid $39,250

Additions to RE $81,620

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Balance Sheet

Current Assets:

Cash $27,920

AR $42,630

Inventory $95,910

Total $166,460

Fixed Assets:

Net Plant & Equip $455,980

Total Assets $622,440

Liabilities & Owners&Equity

Current Liabilities

Account Payable $71,720

Notes Payable $17,620

Total $89,340

Long-Term Debt $170,000

Owners Equity:

Common Stock $140,000

Retained Earnings $223,100

Total $363,100

Total Liabilities & Equity $622,440

a. Analysts predict that sales for Rottweiler Riggings will grow by 20% in 2019. Again, assume the company is operating at full capacity. b. First, assume that the firm plans to use debt as its plug variable if it needs any additional (or have a surplus) financing. Second, assume that it plans to use equity as its plug variable if it needs any external (or have a surplus) financing. Create balance sheets that reflect these two scenarios. c. What is Rottweiler Riggings EFN, if the company was operating at 80% capacity usage for net fixed assets? Assume that Rottweiler Riggings plans to sell any excess fixed assets. (1) First, assume that they plan to use debt as their plug variable if it has any external (or have a surplus) financing. (2) Second, assume it plans to use equity as its plug variable if it needs any external (or have a surplus) financing. Create balance sheets that reflect these two scenarios. d. What is Rottweiler Riggings EFN, if the company was operating at 80% capacity usage for net fixed assets? Assume that Rottweiler Riggings does not plan to sell any excess fixed assets. Assume that it plans to use debt as its plug variable if there is any external (or have a surplus) financing needed.