solve the following questions below Q1 YZ company Balance sheet Balance Sheet Cash and equivalents Operating assets
Fantastic news! We've Found the answer you've been seeking!
Question:
solve the following questions below
Transcribed Image Text:
Q1 YZ company Balance sheet Balance Sheet Cash and equivalents Operating assets Property, plant, and equipment Other assets Total Assets Current liabilities Long-term debt Other liabilities Total liabilities Paid in capital Retained earnings Total equity Total liabilities and equity 570 650 2700 110 4030 920 1280 120 2320 340 1370 1710 4030 YZ company income statement Income Statement Net Sales Cost of Goods Sold Gross Profit Operating Expense Operating Income Other Income Net Interest Expense Pre-tax Income Income Tax Net Income Earnings per Share Shares Outstanding Recent Price Any change in long-term debt will not occur until year end, thus Interest Expense will stay constant year over year. Taxes will remain at 35% of Pre-tax Income. 7800 -5900 1900 -990 910 Property, plant, and equipment are not at capacity, so there is no increase in the gross amount of PP&E. Net PP&E will decrease by the amount of straight line depreciation, or $175. Dividends paid will remain constant at $220 Retained Earnings will increase by the amount of Net Income less dividends paid, or $589 - $220-$369. 105 -200 Prepare a pro forma income statement, balance sheet, and cash flow statement for YZ assuming a 10% increase in sales. Income Statement- in order to complete the pro forma, we will make the following assumptions regarding the upcoming year: Cost of Goods Sold and Operating Expenses will remain the same as a percentage of Net Sales. Other Income will remain constant. There will be no change in number of shares outstanding. Balance Sheet - without specific guidance, we will make the following assumptions: Cash, Operating Assets, and Current Liabilities will spontaneously increase in proportion to the sales growth, or 10%. 815 -285 530 2 265000 34.5 The resulting differences in the change in Assets vs. the change in Liabilities plus Equity will be reflected in the Long-term Debt account. In order for Total Assets and Total Liabilities & Equity to be in balance, Long-term Debt of $1,280 will be reduced by $514 to $766. Q1 YZ company Balance sheet Balance Sheet Cash and equivalents Operating assets Property, plant, and equipment Other assets Total Assets Current liabilities Long-term debt Other liabilities Total liabilities Paid in capital Retained earnings Total equity Total liabilities and equity 570 650 2700 110 4030 920 1280 120 2320 340 1370 1710 4030 YZ company income statement Income Statement Net Sales Cost of Goods Sold Gross Profit Operating Expense Operating Income Other Income Net Interest Expense Pre-tax Income Income Tax Net Income Earnings per Share Shares Outstanding Recent Price Any change in long-term debt will not occur until year end, thus Interest Expense will stay constant year over year. Taxes will remain at 35% of Pre-tax Income. 7800 -5900 1900 -990 910 Property, plant, and equipment are not at capacity, so there is no increase in the gross amount of PP&E. Net PP&E will decrease by the amount of straight line depreciation, or $175. Dividends paid will remain constant at $220 Retained Earnings will increase by the amount of Net Income less dividends paid, or $589 - $220-$369. 105 -200 Prepare a pro forma income statement, balance sheet, and cash flow statement for YZ assuming a 10% increase in sales. Income Statement- in order to complete the pro forma, we will make the following assumptions regarding the upcoming year: Cost of Goods Sold and Operating Expenses will remain the same as a percentage of Net Sales. Other Income will remain constant. There will be no change in number of shares outstanding. Balance Sheet - without specific guidance, we will make the following assumptions: Cash, Operating Assets, and Current Liabilities will spontaneously increase in proportion to the sales growth, or 10%. 815 -285 530 2 265000 34.5 The resulting differences in the change in Assets vs. the change in Liabilities plus Equity will be reflected in the Long-term Debt account. In order for Total Assets and Total Liabilities & Equity to be in balance, Long-term Debt of $1,280 will be reduced by $514 to $766.
Expert Answer:
Answer rating: 100% (QA)
The question asks to prepare a pro forma income statement balance sheet and cash flow statement for YZ company assuming a 10 increase in sales To do t... View the full answer
Related Book For
Fundamentals of Investments Valuation and Management
ISBN: 978-0077283292
5th edition
Authors: Bradford D. Jordan, Thomas W. Miller
Posted Date:
Students also viewed these finance questions
-
In Problem 10.16, we projected financial statements for Walmart Stores, Inc. (Walmart) for Years +1 through +5. The data in Exhibits 12.17-12.19 (pages 948-950) include the actual amounts for 2012...
-
Calculate the gross and operating margins for Kiwi Fruit. Amounts are in thousands of dollars (except number of shares and price per share): Klwl Frult Company Balance Sheet $ 550 Cash and...
-
Calculate ROA and ROE for Kiwi Fruit and interpret these ratios. Amounts are in thousands of dollars (except number of shares and price per share): Klwl Frult Company Balance Sheet $ 550 Cash and...
-
Prove that opposite sides of a quadrilateral circumscribing a circle subtend supplementary angles at the centre of the circle.
-
Use Thevenin?s theorem to find vo(t), t > 0, in figure. 1H 2u(t) A 4u(t) v (+ 10: (1)a 1/2
-
What are some of the criticisms that have been leveled against the cultural-ecology approach? Do you think these criticisms are valid? If so, how would you modify the cultural-ecology perspective to...
-
At the end of 2010, Zeman, Corp., had total assets of $25 million and total liabilities of $13 million. Included in the assets were property, plant, and equipment with a cost of $9 million and...
-
Discuss the impact, both positive and negative, of termination on the project team members. How might the negative impact be lessened?
-
Identify at least an additional product and an additional service that you would require in the implementation of this market research project. Explain the criteria you would use to select...
-
You've bought and sold various companies that trade on the TSX . See below for the trading history of Sprott Ltd: Date. Bought ( Sold ) # of Shrs Price / Shr on TSX . Broke Fees. 0 1 - Feb - 2 1 1 ,...
-
18. Answer the following questions about adjusting tamping technique. a) Briefly explain how adjusting the tamping technique could impact the quality of the espresso coffee. b) Briefly explain when...
-
Determine h/(x) forh(x) Using the Math Editor, enter the correct answer below: (2x-2x) 4 = 7x+3 using logarithmic differentiation.
-
Anna's utility function is U= 11.4/20 where I is income. An investment opportunity where there is a 30% change of earnings $200, a 35% change of earnings $500 and a 35% chance of earning $2,000 has...
-
How should I verify a cobb-douglas function f(x, y, z) = x^0.5y^0.4z^0.2 is a quasi-concave function but not concave function when apply the calculus criteria to Hessian matrix and the bordered...
-
The economic value of investing in broadband infrastructure Gabriel Ahlfeldt, Pantelis Koutroumpis, and Tommaso Valletti conducted a study that used the differences in house prices to deduce the...
-
A 1700kg car is traveling at 20m/s. The car in front of him slams on their brakes. By the time the driver notices the other car has stopped he only has 2.5s to stop. What is the change in momentum of...
-
1-How 3 state process Model different from 5 state model. Draw Linux process state model 2-Explain the criteria to be considered in case of CPU scheduling , Differentiate between FIFO, SJF and RR...
-
What kind of financial pressures can an LBO cause?
-
An important difference between a long position in stock and a short position concerns the potential gains and losses. Suppose a stock sells for $18 per share, and you buy 500 shares. What are your...
-
Suppose you want to hedge a $500 million bond portfolio with a duration of 11.6 years using 10-year Treasury note futures with a duration of 6.2 years, a futures price of 102, and 94 days to...
-
What does it mean to purchase a security on margin? Why might you do it?
-
Solve Chapter Problem 13.21, assuming the force is narrowband with a power spectral density given by \(S_{F}(\omega)=\frac{3 \times 10^{-3}}{2+5 \omega^{2}}\). Data From Chapter Problem 13.21: A SDOF...
-
Solve Chapter Problem 13.21, assuming the power spectral density is band limited with \(\omega_{1}=50 \mathrm{rad} / \mathrm{s}\) and \(\omega_{2}=200 \mathrm{rad} / \mathrm{s}\). Data From Chapter...
-
Fine Leather Ltd has provided the following production and sales information for each pair of its dress shoes. The fixed costs for the period are \($1\) 125 000. Required (a) Calculate the...
Study smarter with the SolutionInn App