Using the data in the student spreadsheet file Ethan Allen Financials.xlsx forecast the 2019 income statement...

   

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Using the data in the student spreadsheet file Ethan Allen Financials.xlsx forecast the 2019 income statement and balance sheet for Ethan Allen. Use the percent of sales method and the following assumptions: (1) sales in FY 2019 will be $797.3359; (2) the tax rate will be 35%; (3) each item that changes with sales will be the five-year average percentage of sales; (4) net fixed assets will increase to $300; and (5) the common dividend will be $0.75 per share. Use your judgment on all other items. a. What is the discretionary financing needed in 2019? Is this a surplus or deficit? b. Assume that the DFN will be absorbed by long-term debt and that the interest rate is 4% of LTD. Set up an iterative worksheet to eliminate it. Ethan Allen Interiors Inc. Income Statement (Industrial) All figures in millions of U.S. Dollar, except per share items Jun '17 Jun '16 Jun '15 Jun '18 Sales Cost of Goods Sold (COGS) incl. D&A Gross Income SG&A Expense EBIT (Operating Income) Interest Expense Other Income - Net Unusual Expense - Net Pretax Income Income Taxes Net Income EPS (recurring) EPS (diluted) Diluted Shares Outstanding Total Shares Outstanding Dividends per Share Payout Ratio EBITDA EBIT Depreciation & Amortization Expense Source FactSet Fundamentals Jun '14 794.202 729.083 729.373 754.600 746.659 343.437 340.163 330.734 339.085 351.966 442.236 411.163 406.496 398.349 390.288 353.057 345.229 336.860 337.912 340.676 89.179 65.934 69.636 60.437 49.612 1.618 5.957 7.540 8.778 9.020 0.395 1.206 0.306 -1.485 0.562 0.000 4.500 0.000 0.000 -0.085 87.956 56.683 62.402 50.174 41.239 31.319 19.541 19.471 17.696 -8.455 56.637 37.142 42.931 32.478 49.694 2.00 1.71 2.00 1.71 28.32 29.11 27.75 28.84 0.62 0.30 31.00 17.54 108.53 68.19 89.18 49.61 19.35 18.58 1.38 1.27 29.18 28.41 0.50 39.37 85.08 65.93 19.14 1.47 1.47 29.28 28.93 0.40 27.21 87.57 69.64 17.93 1.11 1.11 29.24 28.91 0.36 32.43 78.45 60.44 18.01 Assets Cash Only Total Short Term Investments Short-Term Receivables Inventories Ethan Allen Interiors Inc. Balance Sheet (Industrial) All figures in millions of U.S. Dollar, except per share items Jun '18 Jun '17 Jun '16 Other Current Assets Total Current Assets Property, Plant & Equipment - Gross Accumulated Depreciation Net Property, Plant & Equipment Other Long-Term Assets Total Assets Liabilities & Shareholders' Equity ST Debt & Curr. Portion LT Debt Accounts Payable Other Current Liabilities Total Current Liabilities Long-Term Debt Other Liabilities Total Liabilities Common Stock Par/Carry Value Additional Paid-In Capital/Capital Surplus Retained Earnings Treasury Stock and Other Deductions from Equity Total Shareholders' Equity Total Liabilities & Shareholders' Equity Jun '15 Jun '14 52.659 76.182 109.176 72.601 79.721 0.000 2.198 18.153 15.529 9.005 12.547 12.426 12.277 14.919 9.467 162.323 151.916 146.275 137.256 155.739 23.408 282.792 23.755 27.831 19.599 22.907 248.204 270.674 305.629 260.570 594.912 601.709 594.385 302.713 598.264 587.368 317.877 313.553 291.673 324.649 273.615 277.035 288.156 291.672 295.695 55.590 59.599 60.649 65.043 66.301 577.409 607.308 654.434 617.285 644.788 3.001 0.250 3.341 0.501 0.480 18.946 24.320 22.995 15.437 27.315 123.512 104.909 118.682 111.226 109.464 123.347 140.969 136.047 132.939 151.077 130.411 130.809 154.250 38.837 17.593 322.920 74.227 23.023 21.577 20.509 19.180 185.207 236.773 286.967 282.928 0.489 0.489 0.486 0.486 374.972 370.914 365.733 363.938 646.315 607.079 584.395 553.083 629.574 607.947 583.147 583.150 0.485 361.165 542.918 582.700 392.202 370.535 367.467 334.357 321.868 577.409 607.308 654.434 617.285 644.788 Using the data in the student spreadsheet file Ethan Allen Financials.xlsx forecast the 2019 income statement and balance sheet for Ethan Allen. Use the percent of sales method and the following assumptions: (1) sales in FY 2019 will be $797.3359; (2) the tax rate will be 35%; (3) each item that changes with sales will be the five-year average percentage of sales; (4) net fixed assets will increase to $300; and (5) the common dividend will be $0.75 per share. Use your judgment on all other items. a. What is the discretionary financing needed in 2019? Is this a surplus or deficit? b. Assume that the DFN will be absorbed by long-term debt and that the interest rate is 4% of LTD. Set up an iterative worksheet to eliminate it. Ethan Allen Interiors Inc. Income Statement (Industrial) All figures in millions of U.S. Dollar, except per share items Jun '17 Jun '16 Jun '15 Jun '18 Sales Cost of Goods Sold (COGS) incl. D&A Gross Income SG&A Expense EBIT (Operating Income) Interest Expense Other Income - Net Unusual Expense - Net Pretax Income Income Taxes Net Income EPS (recurring) EPS (diluted) Diluted Shares Outstanding Total Shares Outstanding Dividends per Share Payout Ratio EBITDA EBIT Depreciation & Amortization Expense Source FactSet Fundamentals Jun '14 794.202 729.083 729.373 754.600 746.659 343.437 340.163 330.734 339.085 351.966 442.236 411.163 406.496 398.349 390.288 353.057 345.229 336.860 337.912 340.676 89.179 65.934 69.636 60.437 49.612 1.618 5.957 7.540 8.778 9.020 0.395 1.206 0.306 -1.485 0.562 0.000 4.500 0.000 0.000 -0.085 87.956 56.683 62.402 50.174 41.239 31.319 19.541 19.471 17.696 -8.455 56.637 37.142 42.931 32.478 49.694 2.00 1.71 2.00 1.71 28.32 29.11 27.75 28.84 0.62 0.30 31.00 17.54 108.53 68.19 89.18 49.61 19.35 18.58 1.38 1.27 29.18 28.41 0.50 39.37 85.08 65.93 19.14 1.47 1.47 29.28 28.93 0.40 27.21 87.57 69.64 17.93 1.11 1.11 29.24 28.91 0.36 32.43 78.45 60.44 18.01 Assets Cash Only Total Short Term Investments Short-Term Receivables Inventories Ethan Allen Interiors Inc. Balance Sheet (Industrial) All figures in millions of U.S. Dollar, except per share items Jun '18 Jun '17 Jun '16 Other Current Assets Total Current Assets Property, Plant & Equipment - Gross Accumulated Depreciation Net Property, Plant & Equipment Other Long-Term Assets Total Assets Liabilities & Shareholders' Equity ST Debt & Curr. Portion LT Debt Accounts Payable Other Current Liabilities Total Current Liabilities Long-Term Debt Other Liabilities Total Liabilities Common Stock Par/Carry Value Additional Paid-In Capital/Capital Surplus Retained Earnings Treasury Stock and Other Deductions from Equity Total Shareholders' Equity Total Liabilities & Shareholders' Equity Jun '15 Jun '14 52.659 76.182 109.176 72.601 79.721 0.000 2.198 18.153 15.529 9.005 12.547 12.426 12.277 14.919 9.467 162.323 151.916 146.275 137.256 155.739 23.408 282.792 23.755 27.831 19.599 22.907 248.204 270.674 305.629 260.570 594.912 601.709 594.385 302.713 598.264 587.368 317.877 313.553 291.673 324.649 273.615 277.035 288.156 291.672 295.695 55.590 59.599 60.649 65.043 66.301 577.409 607.308 654.434 617.285 644.788 3.001 0.250 3.341 0.501 0.480 18.946 24.320 22.995 15.437 27.315 123.512 104.909 118.682 111.226 109.464 123.347 140.969 136.047 132.939 151.077 130.411 130.809 154.250 38.837 17.593 322.920 74.227 23.023 21.577 20.509 19.180 185.207 236.773 286.967 282.928 0.489 0.489 0.486 0.486 374.972 370.914 365.733 363.938 646.315 607.079 584.395 553.083 629.574 607.947 583.147 583.150 0.485 361.165 542.918 582.700 392.202 370.535 367.467 334.357 321.868 577.409 607.308 654.434 617.285 644.788