Sales in 2017 are estimated to be $80,000 Forecast the 2017 income statement, balance sheet, and statement of cash flow assuming (1) cost of goods sold and$5,000 of the operating expenses are variable (2) de preciation and the remainder of operating expenses are fixed (3) cash, accounts receivable, inventories, net plant, accounts payable, and accrued payables are spontaneous (4) marketable securities, bonds payable, and common stock are discretionary (5) $500 of bonds payable are current and will be re paid at the beginning of the year and (6) the firm will maintain its 2016 dividend payout ratio in year 2017 Analyze the pro forma statements you prepared for the firm above Special note when calculating the ratios that require an average, do not calculate the average For example, Return on Assets formula is EAT Average Total Assets For this test, you will do EAT Total Assets instead This will apply to ROE as well Calculate the financial ratios listed below from the 2016 statements Time interest earned Net profit margin Return on assets Current ratio Quick ratio Debt ratio Return on equity Problem 1 Income Statement For the year ended December 31, 2016 Sales $ 70,000 Cost of goods sold 45,000 Gross profit 25 000 Operating expenses $ 8 000 Depreciation 5 000 13,000 EBIT 12 000 Interest expense 1 300 BT 10700 HTax expense 3 745 FAT $ 6 955 Balance Sheet December 31, 2016 Cash $ 8 000 Marketable securities 2 000 Accounts receivable 10,000 Inventories 6 000 Plant, net 20 000 Total assets $ 46 000 Accounts payable $ 7 000 Accrued payables 3,000 Bonds payable 10 000 Common stock 15 000 Retained earnings 11 000 Total liabilities and equity $ 46 000 Dividends Addition to retained earnings 3 955 Sales in 2017 are estimated to be $80,000 Forecast the 2017 income statement, balance sheet, and statement of cash flow assuming (1) cost of goods sold and$5,000 of the operating expenses are variable (2) de preciation and the remainder of operating expenses are fixed (3) cash, accounts receivable, Inventories, net plant, accounts payable and accrued payables are w spontaneous (4) marketable securities, bonds payable, and common stock are discretionary (5) DUVom bonds payable are current and will be re paidat the beginning of the Vear, and 16 the

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Sales in 2017 are estimated to be $80,000. Forecast the 2017 income statement, balance sheet, and statement of cash flow assuming: (1) cost of goods

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Sales in 2017 are estimated to be $80,000. Forecast the 2017 income statement, balance sheet, and statement of cash flow assuming: (1) cost of goods sold and$5,000 of the operating expenses are variable; (2) de-preciation and the remainder of operating expenses are fixed; (3) cash, accounts receivable, inventories, net plant, accounts payable, and accrued payables are spontaneous; (4) marketable securities, bonds payable, and common stock are discretionary;(5) $500 of bonds payable are current and will be re-paid at the beginning of the year; and (6) the firm will maintain its 2016 dividend payout ratio in year 2017.

Analyze the pro-forma statements you prepared for the firm above. Special note: when calculating the ratios that require an average, do not calculate the average. For example, Return on Assets formula is EAT/Average Total Assets. For this test, you will do EAT/Total Assets instead. This will apply to ROE as well.

Calculate the financial ratios listed below from the 2016 statements
1. Time interest earned
2. Net profit margin
3. Return on assets
4. Current ratio
5. Quick ratio
6. Debt ratio
7. Return on equity

Problem #1 Income Statement For the year ended December 31, 2016 Sales $ 70,000 - Cost of goods sold 45,000 Gross profit 25.000 Operating expenses $ 8.000 Depreciation 5.000 13,000 EBIT 12.000 - Interest expense 1.300 BT 10700 HTax expense 3.745 FAT $ 6.955 Balance Sheet December 31, 2016 Cash $ 8.000 Marketable securities 2.000 Accounts receivable 10,000 Inventories 6.000 Plant, net 20.000 Total assets $ 46.000 Accounts payable $ 7.000 Accrued payables 3,000 Bonds payable 10.000 Common stock 15.000 Retained earnings 11.000 Total liabilities and equity $ 46.000 Dividends Addition to retained earnings 3 955 Sales in 2017 are estimated to be $80,000. Forecast the 2017 income statement, balance sheet, and statement of cash flow assuming: (1) cost of goods sold and$5,000 of the operating expenses are variable; (2) de-preciation and the remainder of operating expenses are fixed. (3) cash, accounts receivable, Inventories, net plant, accounts payable and accrued payables are w spontaneous: (4) marketable securities, bonds payable, and common stock are discretionary:(5) DUVom bonds payable are current and will be re-paidat the beginning of the Vear, and 16 the