Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Use the following financial statements for Lake of Egypt Marina, Inc. LAKE OF EGYPT MARINA, INC. Balance Sheet as of December 31, 2015 and 2014

Use the following financial statements for Lake of Egypt Marina, Inc.

LAKE OF EGYPT MARINA, INC. Balance Sheet as of December 31, 2015 and 2014 (in millions of dollars)
2015 2014 2015 2014
Assets Liabilities and Equity
Current assets: Current liabilities:
Cash and marketable securities $ 74 $ 63 Accrued wages and taxes $ 42 $ 45
Accounts receivable 119 114 Accounts payable 92 82
Inventory 204 194 Notes payable 82 72
Total $ 397 $ 371 Total $ 216 $ 199
Fixed assets: Long term debt: $ 302 $ 282
Gross plant and equipment $ 584 $ 475 Stockholders equity:
Less: Depreciation 126 102 Preferred stock (5 million shares) $ 5 $ 5
Common stock and paid-in surplus (65 million shares) 65 65
Net plant and equipment $ 458 $ 373 Retained earnings 319 244
Other long-term assets 52 51
Total $ 510 $ 424 Total $ 389 $ 314
Total assets $ 907 $ 795 Total liabilities and equity $ 907 $ 795

LAKE OF EGYPT MARINA, INC. Income Statement for Years Ending December 31, 2015 and 2014 (in millions of dollars)
2015 2014
Net sales (all credit) $ 535 $ 452
Less: Cost of goods sold 240 185
Gross profits $ 295 $ 267
Less: Other operating expenses 32 27
Other operating expenses

Earnings before interest, taxes, depreciation, and amortization (EBITDA)

$ 263 $ 240
Less: Depreciation 24 22
Earnings before interest and taxes (EBIT) $ 239 $ 218
Less: Interest 35 32
Earnings before taxes (EBT) $ 204 $ 186
Less: Taxes 59 57
Net income $ 145 $ 129
Less: Preferred stock dividends $ 5 $ 5
Net income available to common stockholders $ 140 $ 124
Less: Common stock dividends 65 65
Addition to retained earnings $ 75 $ 59
Per (common) share data:
Earnings per share (EPS) $ 2.150 $ 1.910
Dividends per share (DPS) $ 1.000 $ 1.000
Book value per share (BVPS) $ 5.910 $ 4.750
Market value (price) per share (MVPS) $ 14.900 $ 12.700

Calculate the internal and sustainable growth rate for Lake of Egypt Marina, Inc. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Internal growth rate %
Sustainable growth rate %

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

Introduction To Finance Financial Management And Investment Management

Authors: Pamela P. Drake, Frank J. Fabozzi, Francesco A. Fabozzi

1st Edition

9811239657, 978-9811239656

More Books

Students also viewed these Finance questions