This is for a Managerial Corporate finance Class, Please See attachment, it is the sheet labeled PART 2 Financing Growth the ONLY document, in the workbook I need help with. I have Completed the internal and sustainable growth portion. I just need help with the rest of the spreadsheet and instructions.

For this part of your project you will work with the financial information forSan Diego Pleasure Craft. You will use the information provided in the case study to determine the company?s Internal Growth rate and the amount of External Financing Needed (EFN) if the company builds a new production line.

Next, download the Microsoft Excel file with anExampleto use as a guide.

The following refers to the appropriate Worksheet on the provided Excel Template.

Worksheet 5 ? Estimating Growth Requirement

1. Calculate the Internal growth rate for SDPC.
2. Calculate the sustainable growth rate for SDPC.
3. SDPC is planning for a growth rate of 12 percent next year. How does this percentage compare to the internal growth rate that you calculated? What are your conclusions and recommendations about the feasibility of SDPC?s expansion plans?
4. Assume that SDPC is currently producing at 100 percent of capacity and sales are expected to grow at 12 percent. As a result, to expand production, the company must set up an entirely new production line at an estimated cost of $75,000,000. Input the projected 12% growth rate and the $75 million increase in Fixed Assets in the pro forma Input parameters box. Under these assumptions, how much external financing will SDPC need to implement the new production line project?
5. Re-compute the selected ratios assuming the external financing will be added to Long-term Debt. In other words, add the amount of EFN to Long-term debt when computing the ratios.
6. Will there be any significant changes the projected growth and expansion investment will cause? Explain your answer.

San Diego Pleasure Craf Income Statement Jan 1 - Dec 31, 2014 Sales $ 555,984,000 Cost of Goods Sold Gross Profit $ $ 391,824,000 164,160,000 Expenses: Selling, General & Administrative Expenses 66,441,600 Depreciation 18,144,000 Interest Total Expenses 10,000,800 94,586,400 Taxes 27,829,440 Net Income $ 41,744,160 Dividends $ 15,795,000 Net Income To Retained Earnings $ 25,949,160 San Diego Pleasure Craf Balance Sheets FY ended Dec. 31, 2013 and Dec 31. 2014 2013 2014 Assets Current Assets Cash & Equivalents $ Accounts Receivable Invetories 9,676,800 $ 10,108,800 17,204,400 15,536,500 16,983,200 18,317,860 997,900 1,065,600 43,415,600 46,475,460 Property, Plant & Equipment (PP&E) 367,934,400 415,827,000 Less Accumulated Depreciation Net PP&E (85,352,300) 282,582,100 (103,496,300) 312,330,700 6,156,000 6,156,000 288,738,100 318,486,700 332,153,700 $ 364,962,160 other Total Current Fixed Assets Intangible Assets Total Fixed Assets Total Assets $ Diego Pleasure Craf Balance Sheets . 31, 2013 and Dec 31. 2014 2013 2014 39,529,300 $ 40,666,900 4,924,800 44,454,100 5,566,500 46,233,400 Long-term Debt 116,424,000 131,904,000 Total Liabilities 160,878,100 178,137,400 Preferred Stock Common Stock 2,700,000 27,000,000 2,700,000 34,167,000 Additional Paid-in Capital 10,800,000 25,633,000 141,575,600 167,524,760 (10,800,000) (43,200,000) 171,275,600 186,824,760 332,153,700 $ 364,962,160 Liabilities Current Liabilities Accounts Payable $ Accrued Expenses Total Current Liabilities Stockholders' Equity Retained Earnings Less Treasury Stock Total Stockholders' Equity Total Liabilities & Stockholders' Equity $ San Diego Pleasure Craf Accounting Statement of Cash Flows Jan 1 - Dec 31, 2014 Operations Net income Depreciation Changes in assets and liabilities Accounts receivable Inventories Accounts payable Accrued expenses Other Total cash flow from operations 41,744,160 18,144,000 221,200 (2,781,360) 1,137,600 641,700 (67,700) 59,039,600 Investing activities Acquisition of fixed assets Sale of fixed assets (54,000,000) 6,107,400 Total cash flow from investing activities (47,892,600) Financing activities Retirement of debt (20,520,000) Proceeds of long-term debt Dividends Repurchase of stock Proceeds from new stock issues Total cash flow from financing activities Change in cash (on balance sheet) 36,000,000 (15,795,000) (32,400,000) 22,000,000 (10,715,000) 432,000 Part 1 - Financial Statement Analysis (Due at the end of Unit 2) Instructions: Using the Industry ratios provided for the Boat Building Industry statements below. Discuss your observations on the results. Please refer to th Complete the Income Statement San Diego Pleasure Craf Common-Size Income Statement Jan 1 - Dec 31, 2014 Sales $ 555,984,000 Cost of Goods Sold Gross Profit $ $ 391,824,000 164,160,000 $ 84,585,600 79,574,400 Expenses: Selling, General & Administrative Expenses Depreciation Total Expenses EBIT 66,441,600 18,144,000 Interest Operating Income 10,000,800 $ Taxes 69,573,600 27,829,440 Net Income $ 41,744,160 Dividends $ 15,795,000 $ 25,949,160 Discuss your observations of the above Financial Statements. The observations from the following financial statements are as follows: The Common Size Income statement for 2014 shows the firm gross profit is above industry average. The horizontal balance sheet comparison shows a 10 percent growth for 2013 and 2014 in total assets and total liabilities and stockholders equity. The greatest difference's on the balance sheet is the 300 percent change in stockholder equity's treasury stock. Additionally, the complete balance statement shows the firms assets are much lower then the industry average and Net PP&E is significantly higher. The firm's current liabilities are much lower when compared to the industry. Boat Building Industry information, complete the Comparative and Common-size financial ults. Please refer to the Project Requirements for complete instructions. Complete the Comparative Balance Sheet Industry Comparison % of Sales Assets 100.0% 70.5% 29.5% 17.10% Current Assets Cash & Equivalents Accounts Receivable Inventories 12.0% other 3.3% 15.2% 14.3% Total Current Fixed Assets 1.8% 12.5% Property, Plant & Equipment (PP&E) 2.90% 5.01% 7.5% Less Accumulated Depreciation Net PP&E 1.60% Intangible Assets Total Fixed Assets 2.8% 4.7% mon Size Income statement for sheet comparison shows a 10 ers equity. The greatest treasury stock. Additionally, ndustry average and Net PP&E to the industry. Total Assets Complete the Common-Size Balance Sheet Assets Current Assets Cash & Equivalents Accounts Receivable Inventories other Total Current Fixed Assets Property, Plant & Equipment (PP&E) Less Accumulated Depreciation Net PP&E Other Noncurrent Assets Total Fixed Assets Total Assets Purple cells require a formula d Common-size financial uctions. Yellow cells only require data. San Diego Pleasure Craf Balance Sheet Horizontal (Trend) Analysis FY ended Dec. 31, 2013 and Dec 31. 2014 2013 $ $ 2014 9,676,800 $ $ change % change 10,108,800 $ 432,000 4% 17,204,400 15,536,500 16,983,200 $ 18,317,860 $ (221,200) 2,781,360 -1% 18% 997,900 1,065,600 $ 67,700 7% 43,415,600 46,475,460 $ 3,059,860 7% 367,934,400 415,827,000 $ 47,892,600 13% (85,352,300) (103,496,300) $ (18,144,000) 21% 282,582,100 312,330,700 $ 29,748,600 11% 6,156,000 6,156,000 $ 288,738,100 318,486,700 $ 29,748,600 10% 332,153,700 $ 364,962,160 $ 32,808,460 10% - 0% San Diego Pleasure Craf Common-Size Balance Sheet FY ended Dec. 31, 2013 and Dec 31. 2014 2014 % of Total Assets Industry Comparison $ 10,108,800 2.8% 7.70% 16,983,200 18,317,860 4.7% 5.0% 20.90% 19.30% 12.7% 51.90% (103,496,300) 312,330,700 85.6% 30.80% 6,156,000 1.7% 17.40% 318,486,700 87.3% 1,065,600 46,475,460 415,827,000 $ 364,962,160 urple cells require a formula ellow cells only require data. ego Pleasure Craf Horizontal (Trend) Analysis 31, 2013 and Dec 31. 2014 2013 2014 $ change 39,529,300 $ 40,666,900 $ 1,137,600 4,924,800 44,454,100 5,566,500 $ 46,233,400 $ 641,700 1,779,300 116,424,000 160,878,100 131,904,000 $ 178,137,400 $ 15,480,000 17,259,300 Preferred Stock 2,700,000 2,700,000 $ Common Stock 27,000,000 34,167,000 $ 7,167,000 Additional Paid-in Capital 10,800,000 25,633,000 $ 14,833,000 141,575,600 167,524,760 $ 25,949,160 (10,800,000) (43,200,000) $ (32,400,000) 171,275,600 186,824,760 $ 15,549,160 332,153,700 $ 364,962,160 $ 32,808,460 Liabilities Current Liabilities Accounts Payable $ Accrued Expenses Total Current Liabilities Long-term Debt Total Liabilities Stockholders' Equity Retained Earnings Less Treasury Stock Total Stockholders' Equity Total Liabilities & Stockholders' Equity $ - ego Pleasure Craf -Size Balance Sheet 31, 2013 and Dec 31. 2014 2014 Liabilities Current Liabilities % of Total Assets Industry Comparison Accounts Payable $ 40,666,900 11.1% 14.40% 5,566,500 46,233,400 1.5% 12.7% 29.20% 131,904,000 178,137,400 36.1% 48.8% 23.20% Preferred Stock Common Stock 2,700,000 34,167,000 0.7% 9.4% Additional Paid-in Capital 25,633,000 7.0% 167,524,760 45.9% Accrued Expenses Total Current Liabilities Long-term Debt Total Liabilities Stockholders' Equity Retained Earnings Less Treasury Stock (43,200,000) Total Stockholders' Equity Total Liabilities & Stockholders' Equity 186,824,760 $ 364,962,160 -51.2% 47.60% % change 3% 13% 4% 13% 11% 0% 27% 137% 18% 300% 9% 10% Part 1 - Ratio Analysis (Due at the end of Unit 2) Instructions: Research the Boat Building Industry information, then complete the ratio analysis below. Discuss your observations on the results. Please refer to the Project Requirements for complete instructions. Purple cells require a formula Yellow cells only require data. Complete the Ratio Analysis below. Show work here Current ratio = Current assets / Current liabilities Quick ratio = (Current assets - Inventory) / Current liabilities Inventory turnover = COGS / Inventory Current Ratio=$46,475,460/$46,233,400 Quick Ratio= ($46,475,460-$18,317,860)/$46,233,400 Industry Median ratio SDPC ratio Comments about specific ratio: Comments about Category of ratios: Liquidly ratios- the quick ratio show the firm may have difficulty paying its current liabilities with quick 1.01 Additionally, the current ratio shows the firm may struggle to pay its short-term liabilities with its 1.78 The companys current ratio is significantly lower than the industry average. 43.26% lower to be exact.assets. I current assets, due to the firms significantly lower working capital. 0.61 1.05 Again, the quick ratio for the company is 41.90% lower than the industry average Inventory Turnover=$391,824,000/$18,317,860 21.39 Days Receivables = 365 (Sales / Accounts receivable) Days Receivables= (365+($555,984,000/$16,983,200) 11.15 Debt-equity ratio = Total liabilities / Total equity Debt-equity ratio= (446,233,400 +131,904,000)/$186,824,760) Interest coverage = EBIT / Interest interest coverage= $79,574,400/$10,000,800 Pre-tax Profit margin =(Net Income + Taxes) / Sales Pre-tax Profit Margin = ($41,744,160 + 27,829,440)/$555,984,000) 12.5% Pre-tax Return on Assets = (Net Income + Taxes) / Total assets Pre-tax Return on Assests = ($41,744,160 + 27829,440)/$364,962,160 19.1% Pre-tax Return on Equity = (Net Income + Taxes) / Total equity Pre-tax return on Equity = ($41,744,160 + 27,829,440)/$186,824,760 37.2% 0.95 7.96 8.24 The companys Inventory turn over is not good when compared to the industry average, It is much Turnover Rations- the turn over ratios shows that the industry uses its assets to generate sales. SDPC may higher. The company should improve their ordering and inventory control processes. want to consider a different pricing structure. Additionally, improving how inventory is managed could improve the turnover rate. 40 The compny does a much better job collecting when compared to the idustry average. Leverage Ratios- All of SDPC leverage ratios are outstanding when compared to the industry averages. 1.1 The firms current debt-equity ratio is slighlt below average. 8.53 SDPC intrest is lower than industry average, possible because their debt is not as high. 2.06% SDPC is beating its competitors in this area. 4.90% SDPC return on assests is impressive when compared to the industry average. 10.20% SDPC return on equity is great, when compared to the industry average. 27,829,440 Profitability Ratios- the firms return on assets and return on equity are great when compared to the industry average. In turn, shows the firm is able to effectively manage its assets to produce profits during a period. Furthermore, the firm ROE shows the firm is able to generate profits from its shareholders investments into the company. Part 1 - Financial Cash Flow Analysis (Due at the end of Unit 2) Instructions: Complete the Financial Cash Flow analysis below using the data write-up. Discuss your observations on the results. Please refer to the Projec complete instructions. Complete the Following Financial Cash Flow Analysis. 1 Answer the following q a. Wh Flow An Compute the operating cash flow (OCF) OCF = EBIT + Depreciation - Current taxes $69,888,960 OCF = 2 Compute Net Capital Spending Ending net fixed assets - Beginning net fixed asset + Depreciation Net capital spending $318,486,700 -$288,738,100 $18,144,000 $47,892,600 3 Compute the Change in Net Working Capital Ending NWC $242,060 - Beginning NWC -$1,038,500 Change in NWC $1,280,560 4 Compute the Cash Flow from Assets Operating cash flow - Net capital spending - Change in NWC Cash flow from assets $69,888,960 $47,892,600 $1,280,560 $20,715,800 5 Compute the Cash Flow to Creditors Beginning long-term debt - Ending long-term debt + Interest Total $116,424,000 -$131,904,000 $10,000,800 -$5,479,200 6 Compute Cash Flow to Stockholders Beginning total equity - Ending total equity +Dividends +Retained earnings Total $171,275,600 $186,824,760 $15,795,000 $25,949,160 $26,195,000 The financial cash flow compared to the accoun companies current finan Analysis is the most hel "Corporate finance for D b. H The information provide of operating income sho assets and $1,280,560 t c. I SDPC has a positive cash expanding business ope regarding inventory. Ho w using the data provided in the Case fer to the Project Requirements for Purple cells require a formula Yellow cells only require data. Answer the following questions. a. Which cash ows statement, the Accounting Statement of Cash Flows, or the Cash Flow Analysis, more accurately describes the cash ows at the company? The financial cash flow analysis describes the cash flows of the company more accurate, when compared to the accounting statement of cash flows. The financial cash flow analysis shows the companies current financial standing, rather then its operational conditions. "Financial cash flow Analysis is the most helpful statement concerning's a company's overall health" as mentioned in "Corporate finance for Dummies" by, Michael Taillard. b. How would you describe SDPC's cash ows? The information provided on the cash flows show, SDPC has a positive cash flow. The positive balance of operating income shows the company is able to pay its bills. SDPC invested $47,892,600 to fixed assets and $1,280,560 to net working capital. c. In light of your previous answers, comment on SDPC's expansion plans. SDPC has a positive cash flow, but could use additional income and resources for growing and expanding business operations. Taking a look at the current ratios, SDPC has room for improvement regarding inventory. However, shows a great return on both equity and assets. Part 2 - Financing Growth (Due at the end of Unit 3) Instructions: Using the financial statements below: 1. Compute the Internal Growth rate and Sustainable Growth rate. 2. Discuss your results. 3. Enter the required information to compute the External Financing Needed projected growth rate and the tax rate are given in the case write-up. 4. Recompute the affected financial ratios. NOTE -Round EFN up to the neare Additionally assume that the Debt will carry a 5.5% Interest payment and tha 5. Discuss your results. Please refer to the Project Requirements for complete instructions. San Diego Pleasure Craf Financial Statements Sales Costs SG&A Depreciation EBIT Interest expense Taxable income Taxes Net income 2014 Income Statement $ Dividends Add. to retained earnings #1 $ 555,984,000 391,824,000 66,441,600 18,144,000 79,574,400 10,000,800 69,573,600 24,350,760 45,222,840 $ 15,795,000 $ $ 29,427,840 Compute the Internal Growth rate from the above financial statements ROA = Net Income / Total Assets ROA = 12.39% Retention ratio (b) = Addition to Retained Earnings / Net Income b= 65% Internal growth rate = (ROA b) / [1 - (ROA b)] Internal growth rate = 8.77% Input the projected growth rate into the Sales Increase parameter below, then discuss the results of the internal growth rate,rate theatsustainable andshows the predicted growth ratetoofgrow, 12%.maintain *Note -operati leave The internal growth San Diego growth Pleasurerate crafts the firm will be able additional resources. However, after reaching the growth rate of 8.77% the firm will need to seek addition 18.07% measures how large and how quickly the firm can grow while maintaing its debt to equti ratio. Ad also shows the firm is able to take on 18.70% more debt before its debt to equity ratio will change. In whi using more equity. The retention ratio show the firm intends to retain 65%. #2 #3 Complete the Input parameters Dividend payout ratio Sales increase Tax rate Debt reduction rate Project cost 2015 Pro Forma Statements Output area: DO NOT TYPE in this box! Income Statement Sales $ 604,743,797 Costs 426,186,965 SG&A 72,268,528 Depreciation 19,735,229 EBIT Interest expense $ 86,553,075 10,000,800 Taxable income Taxes Net income Dividends Add. To RE #4 $ $ $ 76,552,275 41,338,228 35,214,046 12,299,225 22,914,822 New Debt required (rounded up to nearest 100,000): Additional Interest Expense: Comparison of Ratios (formulas are for "Afer" computation) Debt-equity ratio = (Total liabilities + New Debt) / Total equity Pre-tax Profit margin = (Taxable Income - New Interest) / Sales Pre-tax Return on assets = (Taxable income - New Interest) / Total assets Pre-tax Return on equity = (Taxable income - New Interest) / Total equity a. Input the projected 12% growth rate and the $75 million increase in Fixed Assets in much external financing will SDPC need to implement the new production line projec b. Re-compute the selected ratios and discuss any significant changes that the project required external financing will come from Debt. #5 d of Unit 3) ents below: d Sustainable Growth rate. mpute the External Financing Needed (EFN) for the project expansion. Use the original estima re given in the case write-up. os. NOTE -Round EFN up to the nearest $100,000. Assume that all of the new financing will c arry a 5.5% Interest payment and that the projected Interest Expense will increase proportion s for complete instructions. 2014 Balance Sheet Assets 70.47% Current assets Cash Accounts receivable Inventory Other Total CA Fixed assets Net plant and equipment Intangibles financial statements $ $ 10,108,800 16,983,200 18,317,860 1,065,600 46,475,460 $ 312,330,700 6,156,000 Total Fixed Assets $ 318,486,700 Total assets $ 364,962,160 Compute the Sustainable Growth rate from the above financial s ROE = Net Income / Total Equity ROE = 24.21% s / Net Income Retention ratio (b) = Addition to Retained Earnings / Net Income b= 65% Sustainable growth rate = (ROE b) / [1 - (ROE b)] Sustainable growth r 18.70% e parameter below, then discuss the results of the Output data. Specifically address the differences between the computed the predicted growth ratetoofgrow, 12%.maintain *Note -operations, leave the tax rate theassests Projectasparameters 35%ofand $0, respectively. hows the firm will be able and addand fixed needed at aatrate 8.77% without requiring an th rate of 8.77% the firm will need to seek additional resources. Furthermore, San diego Pleasure Crafts sustainable growth rate can grow while maintaing its debt to equti ratio. Additionally, without borrowing additional money. The sustainable growth rate bt before its debt to equity ratio will change. In which case, the company will be forced to finance the growth of the company by ntends to retain 65%. 34.93% 8.77% 54% 3.1% * Assume exisiting debt is reduced each year through principal payme Balance Sheet Assets Current assets Cash Accounts receivable Inventory Other Total Current Assets mputation) est) / Total assets est) / Total equity Fixed assets Net plant and equipment Intangibles Total Fixed Assets Total assets External financing needed to sustain projected growth rate & project SDPC Before Expansion Industry Median 1.1 2.60% 4.90% 10.20% d the $75 million increase in Fixed Assets in the pro forma Input parameters box. Under these assumptions implement the new production line project? uss any significant changes that the projected growth and expansion investment will cause. Assume that th m Debt. sion. Use the original estimated project cost. The all of the new financing will come from Debt. ense will increase proportionately. 2014 Balance Sheet Liabilities and owners' equity Current liabilities Accounts payable $ Accrued Expenses Total CL $ Long-term debt Total liabilities Owners' equity 40,666,900 5,566,500 46,233,400 $ 131,904,000 178,137,400 Stock and Additional Paid-in $ Capital 62,500,000 Retained earnings, net of Treasury stock Total Equity Total liabilities and owners' equity Growth rate from the above financial statements $ 124,324,760 186,824,760 $ 364,962,160 Purple cells require a formula Yellow cells only require data. tion to Retained Earnings / Net Income (ROE b) / [1 - (ROE b)] e differences between the computed ers 35%ofand $0, respectively. at aatrate 8.77% without requiring any Pleasure Crafts sustainable growth rate of nal money. The sustainable growth rate o finance the growth of the company by ced each year through principal payments. Balance Sheet Liabilities and owners' equity Current liabilities $ 10,995,342 Accounts payable $ 44,233,387 18,472,627 Accrued Expenses $ 5,566,500 $ 49,799,887 19,924,336 Total CL 1,159,053 Long-term debt 127,796,152 50,551,358 Total liabilities 177,596,039 339,722,102 6,156,000 345,878,102 Owners' equity Common stock and paid-in surplus Retained earnings Total Equity $ 396,429,460 al financing needed to sustain ed growth rate & project Total liabilities and Owners Equity $ SDPC Afer Expansion s box. Under these assumptions, how tment will cause. Assume that the 9,093,839 $ 62,500,000 147,239,582 $ 209,739,582 $ 387,335,621 Purple cells require a formula Yellow cells only require data. Part 3 - Debt Financing (Due at the end of Unit 5) Instructions: Compute the total amount of Bond financing needed for the exp amounts of $1,000. The Coupon rate will be 5.5% and the Market rate is 4%. Discuss your observations on the results. Please refer to the Project Requirem a. How much total Bond financing is needed? Bond information Face Number of Bonds issued Coupon Annual Coupon Payment per bond Market Term (years) b. At what price will the bon Principal Interest payments Price of each Bond c. What are the company's total annual interest payments? d. What is the total market value of the bonds? e. Please discuss the implications of your calculations and why the market value and the actual proceed eeded for the expansion project. Bonds may only be issued in Face arket rate is 4%. Round your solution to the nearest $100,000. Project Requirements for complete instructions. what price will the bonds trade afer the initial issue? Factor Present Value st payments of each Bond and the actual proceeds from the bond issue are different. Discuss how this changes Purple cells require a formula Yellow cells only require data. Part 3 - Capital Structure (Due at the end of Unit 5) Instructions: 1. Input the projected growth rate and actual project cost into the Input Para 2. Using the new level of EFN, recompute the financial ratios assuming all of Assume the Interest payments will be 5.5% of new debt. 3. Discuss your results, and what other options for financing the company ha Please refer to the Project Requirements for additional data and complete ins #1 Complete the Input parameters Dividend payout ratio Sales increase Tax rate Debt reduction rate Project cost 2015 Pro Forma Statements Output area: DO NOT TYPE in this box! Income Statement Sales $ 555,984,000 Costs 391,824,000 SG&A 66,441,600 Depreciation 18,144,000 EBIT $ Interest expense Taxable income Taxes Net income Dividends Add. To RE 79,574,400 10,000,800 $ $ $ 69,573,600 69,573,600 24,300,000 45,273,600 #2 New Debt required (rounded up to nearest 100,000): Additional Interest Expense: Comparison of Ratios (formulas are for "Afer" computation) Debt-equity ratio = (Total liabilities + New Debt) / Total equity Pre-tax Profit margin = (Taxable Income - New Interest) / Sales Pre-tax Return on assets = (Taxable income - New Interest) / Total assets Pre-tax Return on equity = (Taxable income - New Interest) / Total equity Discussion: Be sure to address b. How much extra financing is needed above the Bond issue? c. What options for financing this shortage does SDPC have? d. How will these options affect the firm, cash ow, Net Income and it's financial ratios? #3 of Unit 5) ctual project cost into the Input Parameters box. Note the new level of EFN. e the financial ratios assuming all of the EFN will come from Debt. Round up to the nearest $ e 5.5% of new debt. options for financing the company has. for additional data and complete instructions. 34.93% 3.1% * Assume exisiting debt is reduced each year through principal paym Balance Sheet Assets Current assets Cash $ 10,108,800 Accounts receivable 16,983,200 Inventory 18,317,860 Other 1,065,600 Total Current Assets 46,475,460 Fixed assets Net plant and equipment Intangibles Total Fixed Assets Total assets 312,330,700 6,156,000 318,486,700 $ 364,962,160 mputation) est) / Total assets est) / Total equity Bond issue? DPC have? w, Net Income and it's financial ratios? External financing needed to sustain projected growth rate & Project SDPC Before Expansion SDPC Afer Expansion with Industry Median New Debt N. up to the nearest $100,000. ar through principal payments. Balance Sheet Liabilities and owners' equity Current liabilities Accounts payable $ 40,666,900 Accrued Expenses $ 5,566,500 $ 46,233,400 Total CL Long-term debt 127,796,152 Total liabilities 174,029,552 Owners' equity Common stock and paid-in surplus Retained earnings Total Equity Total liabilities and Owners Equity $ 62,500,000 169,598,360 $ 232,098,360 $ 406,127,912 ed to sustain & Project $ (41,165,752) Part 3 - Net Present Value (Due at the end of Unit 5) Instructions: 1. Compute the Net Working Capital cash ow required by the new productio 2. Compute the expected Operating Cash Flow from the production line. 3. Using the above cash ow data, compute the NPV of the project cost using issue the original amount of Bonds and offer equity financing for the remaiinin 4. Discuss your decision and the results. Please refer to the Project Requirements for additional data and complete ins Compute theNet Working Capital (NWC) cash ow. #1 Year 1 Projected Revenue Beginning NWC Ending NWC NWC cash flow #2 Year 2 $ $ - $ - Compute the expected Operating Cash Flow from the production line. Year 1 Projected Revenue Variable costs Fixed costs Depreciation EBIT Interest on Bonds EBT Tax (35%) #3 $ Year 2 - - - - Net income - - OCF = EBIT + Depreciation - Current taxes Operating Cash Flow - - Compute the NPV for the project: Year 0 OCF Capital spending Net working capital cash flow Year 1 - - Terminal value Total cash flows PV factor PV of amount NPV #4 Discuss your decision and your results. - - ed by the new production line. he production line. of the project cost using the final estimated cost. You must decide if the company will finance nancing for the remaiining financing needs. Be sure to use the appropriate projected interest l data and complete instructions. Year 3 Year 4 $ $ - Year 3 Year 5 $ $ - Year 4 Year 6 $ $ - Year 5 - - - - - - - - - - - - Year 2 Year 3 Year 4 Year 5 - - - - - - - - - - - - pany will finance the entire project through debt, or will projected interest payments. Purple cells require a formula Yellow cells only require data. Note - there are no taxes computed if EBT is negative