Asher, your newly appointed boss, has tasked you with evaluating the following financial data for Allied Biscuit Co. to determine how Allied Biscuit's value has changed over the past year. The investment firm for which you work will make a positive (or "buy") recommendation to its investing clients if Allied Biscuit's value has increased over the past year, a neutral (or "hold") recommendation if the value has remained constant, or a negative (or "sell") recommendation if the value has decreased. He has recommended that you use several metrics to ascertain how the firm's value has changed, and he has provided you with the following income statement and balance sheet. Allied Biscuit Co Income Statement January 1 - December 31, Year 2 Allied Biscuit Co Balance Sheet December 31, Year 2 Year 1 $8,912,500 $7,750,000 6,355,000 1,395,000 271,250 1,123,750 193,750 930,000 372,000 $558,000 $334,800 $223,200 Year 2 Year 1 $441,750 1,472,500 2,576,875 4,491,125 2,871,375 $8,466,875 $7,362,500 Year 2 $508,013 1,693,375 2,963,406 5,164,794 3,302,081 Cash and cash equivalents Receivables Inventory Expenses1 7,130,000 1,782,500 311,938 1,470,562 267,375 1,203,187 481,275 $721,912 $433,147 $288,765 EBITDA Depreciation and amortization expense Current assets EBIT Net fixed assets Total assets Liabilities and Equity: Accounts payable Accruals Notes payable Interest expense EBT Tax expense (40%) Net income Common dividends Addition to retained earnings 1Excludes depreciation and amortization $1,270,031 $1,104,375 717,844 1,546,12!5 3,368,344 1,417,281 4,785,625 515,375 2,061,500 2,576,87!5 $8,466,875 $7,362,500 825,520 1,778,04*4 3,873,595 1,629,873 5,503,469 592,681 2,370,725 2,963,406 Total current liabilities Long-term debt Total liabilities Common stock ($1 par) Retained earnings Total equity Total debt and equity Shares outstanding Weighted average cost of capital 592,681 7.98% 515,375 Asher, your newly appointed boss, has tasked you with evaluating the following financial data for Allied Biscuit Co. to determine how Allied Biscuit's value has changed over the past year. The investment firm for which you work will make a positive (or "buy") recommendation to its investing clients if Allied Biscuit's value has increased over the past year, a neutral (or "hold") recommendation if the value has remained constant, or a negative (or "sell") recommendation if the value has decreased. He has recommended that you use several metrics to ascertain how the firm's value has changed, and he has provided you with the following income statement and balance sheet. Allied Biscuit Co Income Statement January 1 - December 31, Year 2 Allied Biscuit Co Balance Sheet December 31, Year 2 Year 1 $8,912,500 $7,750,000 6,355,000 1,395,000 271,250 1,123,750 193,750 930,000 372,000 $558,000 $334,800 $223,200 Year 2 Year 1 $441,750 1,472,500 2,576,875 4,491,125 2,871,375 $8,466,875 $7,362,500 Year 2 $508,013 1,693,375 2,963,406 5,164,794 3,302,081 Cash and cash equivalents Receivables Inventory Expenses1 7,130,000 1,782,500 311,938 1,470,562 267,375 1,203,187 481,275 $721,912 $433,147 $288,765 EBITDA Depreciation and amortization expense Current assets EBIT Net fixed assets Total assets Liabilities and Equity: Accounts payable Accruals Notes payable Interest expense EBT Tax expense (40%) Net income Common dividends Addition to retained earnings 1Excludes depreciation and amortization $1,270,031 $1,104,375 717,844 1,546,12!5 3,368,344 1,417,281 4,785,625 515,375 2,061,500 2,576,87!5 $8,466,875 $7,362,500 825,520 1,778,04*4 3,873,595 1,629,873 5,503,469 592,681 2,370,725 2,963,406 Total current liabilities Long-term debt Total liabilities Common stock ($1 par) Retained earnings Total equity Total debt and equity Shares outstanding Weighted average cost of capital 592,681 7.98% 515,375