Calculate SECs forecasted ratios, and compare them with the company's 2009 ratios and with the industry averages. Calculate SEC's forecasted free cash flow and return on invested capital (ROIC).

Betty Simmons, the new financial manager of Southeast Chemicals (SFC), a Georgia producer of specialized chemicals for use in fruit orchards, must prepare a financial forecast for 2010. SEC's 2009 sales were $2 billion, and the marketing department is forecasting a 25% increase for 2010.

A. 2009 Balance sheet (Millions of Dollars)

B. 2009 Income Statement (Millions of Dollars)

C. KeyRatios

Percent ol Sales oe Sales S 100 100 200 100 Cash and securses Accounts paryable and xcruals 5% otal cuee lablitics Long temn debe Common stock Retained earmings 500 500 otal cureent ases Net fined assets 25% 200 1,000 Total assets 51.000 Total liabilities and equity B. 2009 Income Statement (Millions of Dollars) Percent of Sales Sales Cost of goods sold COGS) Sales, gneral, and administrative costs SGA $2,000.00 1200.00 60% 35% Eanings before interest and taxes Interest $100.00 0.00 $ 90.00 6.00 S 54.00 21.60 1 Earnings before taxes Taxes 140%, Net income Dividends (40% Add tion to retained earnings C. Key Ratios SEC Industry Profit margin Return on equity Days sales outstanding 365 days Inventory turnover Fixed assets turnover Debt/assets Times interest earned Current ratio Return n investod rapital NOPAT/Operating capital) 2.70% 7.71% 3.80 days 32.00 days 8.33 4.00 4.00% 15.60% 11.00 5.00 36.00% 9.40 3.00 14 00% 30,00% 10.00 2.50 67%