The JTP Company, located in Jenkintown, PA, is a small manufacturer and distributor of custom machined components. Because of some successful new products marketed to tool and die manufacturers, the firm has seen steady revenue growth. Expecting sales growth to continue, the company expanded operations in 2020 through significant investments in property, plant, and equipment. However, the growth has been accompanied by a precipitous drop in the companys stock price.

You are a financial consultant who has been retained to analyze the companys performance. Your investigative plan involves a series of in-depth interviews with management and doing some independent research on the industry. However, before starting, you want to focus your thinking to be sure you can ask the right questions. You begin by analyzing the firms financials over the last three years, which are presented in the supplemental datasheet. As part of your discovery process, you learn that the company sold no property, plant, or equipment during the time periods presented. Also, the company did not repay any long-term debt in 2020. The account balance of the common stock account (part of equity) did not change. And finally, the companys normal credit terms extended to its customers are net 15.

Required Submission Complete the following using Microsoft Excel and Word. All quantitative analysis will be done in Excel, while all qualitative analysis will be completed in Word. You must use formulas for all computations.

In Microsoft Excel:

1. Construct horizontal analysis (year-over-year growth) on the provided financial statements for 2019 and 2020. 2. Build common size balance sheets for 2018 - 2020, respectively, and common size income statements for 2018 - 2020, respectively. 3. Create Statements of Cash Flows for 2019 and 2020 using the indirect method. Also compute Free Cash Flow for each year. 4. Calculate all the financial ratios discussed in chapter 16 (use exhibit 16-6 as a guide) for 2019 and 2020.

The example didn't give much guidance only this chart.

In Microsoft Word:

1. Based on all of your financial statement analysis, what do you think is causing the decline in the companys stock price? In other words, why might the market not be reacting favorably to JTPs growth? 2. In light of your response above, what two (or more) specific actionable items could the company do to improve its situation? Be specific in your response, justifying your statements.

I'm very confused on how to do this please help :(

Balance sheets Dec 31 This Year Last Year Assets Current assets: Cash $ 30,000 $ 20.000 Accounts receivable net 20,000 17,000 Inventory 12,000 10,000 Prepaid expenses 3,000 2,000 Total current assets 65,000 49,000 Property and equipment: Land 165,000 123.000 Buildings and equipment, net 116,390 128,000 Total property and equipment 281,390 251,000 Total assets $ 346,390 $ 300,000 L and SE Current liabilities: Accounts payable $ 39,000 S 40,000 Notes payable short-term 3,000 2.000 Total current liabilities 42.000 42.000 Long-term liabilities: Notes payable, long-term 70,000 78,000 Total liabilities 112,000 120.000 Stockholders' equity: Common stock, $1 par value 27,400 17,000 Additional paid-in capital 158,100 113,000 Total paid-in capital 185,500 130,000 Retained earnings 48.890 50,000 Total stockholders' equity 234,390 180,000 L-SE $ 346,390 $ 300,000 Income Statements, For the Years Ended December 31 This Year Last Year Sales $ 494,000 $ 450,000 Cost of goods sold 140,000 127,000 Gross margin 354,000 323,000 Operating expenses 270,000 249,000 Net operating income 84,000 74,000 Interest expense 7,300 8.000 Net income before taxes 76,700 66,000 Less income taxes (30%) 23.010 19,800 Net income $ 53,690 S 46,200 Ratios to assess liquidity: ability to pay back CL Table 1 Balance Sheets 2018 2019 2020 Table 2 Income Statements 2018 2019 2020 $3,796 2,425 $4,036 2,548 $4,308 2,786 Assets Cash Accounts receivable Inventory Other current assets Gross Property, Plant, & Equipment Accumulated Depreciation Total assets $414 78 398 79 2,146 -$1.299 $1,816 $333 93 424 196 2.441 -$1.467 $2.020 $362 119 446 121 4.148 -$1.646 $3,550 Sales Cost of goods sold Operating expenses: Depreciation Selling & Administrative Expense Other Operating Expenses Operating Income Interest expense Pre-tax Profit Income Tax Expense Net Income 167 880 21 303 1 $302 83 $219 168 981 2 337 1 $336 83 $253 179 1,029 80 234 21 $213 54 $159 - Liabilities and equity Accounts payable Accruals & other current liabilities Long-term debt Total equity Total liabilities and equity $237 248 84 1.247 $1,816 $242 302 73 $286 466 1,329 1.469 $3,550 1.403 $2,020 Table 3 Other Information 2018 2019 2020 Dividends Paid Stock Issuance Stock price -Avg. Shares outstanding Avg. Interest Rate on Long-term debt Effective Tax Rate $89 $0 $39.27 177 1.20% 33.87% $97 $93 $0 $0 $26.10 $11.55 172 167 1.40% 1.60% 24.17% 285.19%