After graduating from college in May 2018, Ryan Crews started his career in finance at the...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
After graduating from college in May 2018, Ryan Crews started his career in finance at the W&T Corporation, a small- to medium-sized warehouse distributor in Nashville, Tennessee. The company was founded by David Winston and Colin Tabor in 2005, after they have worked together in management at Walmart. Although Crews had an offer from Sam's Club, he became excited about the opportunity with W&T For W&T, 2017 tumed out to be a good financial year. But in 2018, the company experienced a 5.3 percent sales reduction, where sales declined from $5.8 million to $5.5 million. The downturn then led to other financial problems, including a 50 percent reduction in the company's stock price. The share price went from $38 per share at the end of 2017 to $19 per share at the end of 2018! David Winston and Colin Tabor want to understand what may have happened. Financial information for W&T for both years is shown in the popup window, for per-share data, are shown in thousands. 4 where all the numbers, except W and T Corporation Income Statement ($ thousands) for the Years Ended 12/31/2017 and 12/31/2018 2017 Sales Cost of goods sold Gross profits Operating expenses Selling, general, and administrative expenses Depreciation expenses Total operating expenses Operating profits Interest expense Earnings before taxes (taxble income) Income taxes Net income Additional information: Number of common shares outstanding Dividends paid to stockholders Market price per share $ $ $ $ $ 5,800 $ (3.600) 2,200 $ (800) (330) (1.130) 1,070 (190) 880 (185) 695 150 $94 $38 2018 5,500 (3,500) 2,000 (750) (500) $ (1,250) $ 750 (275) 475 (100) 375 150 $94 $19 18 W and T Corporation Balance Sheet($ thousands) for 12/31/2017 and 12/31/2018 ASSETS Cash Accounts receivable Inventories Other current assets Total current assets Gross fixed assets Accumulated depreciation Net fixed assets Total assets LIABILITIES (DEBT) AND EQUITY Accounts payable Short-term notes payable Total current liabilities Long-term debt Total liabilities Common equity Common stock Retained earnings Total common equity Total liabilities and equity Print MA SAM $ $ S GA $ $ Done 1,735 2,350 4,550 4,950 (1,600) (2,300) 2,950 2,650 $ 4,685 $ 5,000 $ $ 2017 300 700 600 135 500 350 850 1,250 2,100 $ $ $ S 2018 485 925 780 160 740 400 1,140 1,325 2,465 1,000 1,585 2,585 $ 2,535 4,685 $ 5,000 1,000 1,535 Days in inventories Operating return on assets Operating profit margin Total asset turnover Fixed asset turnover Debt ratio Times interest earned 2017 60.83 days Sales Cost of goods sold Gross profits 2017 22.8% 2017 18.45 % 2017 1.24 X 2017 1.97 X 2017 44.8% 2017 5.63 X 2017 26.9 % Operating expenses Selling, general, and administrative expenses Depreciation expenses Total operating expenses Operating profits Interest expense Earnings before taxes (taxable income) Income taxes Net income S $ 2018 81.34 days $ 2018 15% $ 2018 13.6% 2018 1.10 X 2018 2.08 X 2018 49.3 % 2018 2.73 X 2018 14.8 % (800) (330) S (1,130) $ 1,070 (190) 880 (185) 695 Return on equity (Round to one decimal place.) (2) Complete a common-sized income statement for 2017 and 2018. (Round to one decimal place.) Common-Sized Income Statement ($ thousands) for the Years Ended 12/31/2014 and 12/31/2015 2017 2017 2018 5,800 (3,600) 2,200 (Round to two decimal places.) (Round to one decimal place.) (Round to one decimal place.) (Round to two decimal places.) (Round to two decimal places.) (Round to one decimal place.) (Round to two decimal places) $ 5,500 % (3,500) % $ 2,000 % %. se je a je % % % % % 4 % (750) (500) $ (1,250) $ 750 (275) 475 (100) 375 $ 2018 je je je % % % % % % After graduating from college in May 2018, Ryan Crews started his career in finance at the W&T Corporation, a small- to medium-sized warehouse distributor in Nashville, Tennessee. The company was founded by David Winston and Colin Tabor in 2005, after they have worked together in management at Walmart. Although Crews had an offer from Sam's Club, he became excited about the opportunity with W&T For W&T, 2017 tumed out to be a good financial year. But in 2018, the company experienced a 5.3 percent sales reduction, where sales declined from $5.8 million to $5.5 million. The downturn then led to other financial problems, including a 50 percent reduction in the company's stock price. The share price went from $38 per share at the end of 2017 to $19 per share at the end of 2018! David Winston and Colin Tabor want to understand what may have happened. Financial information for W&T for both years is shown in the popup window, for per-share data, are shown in thousands. 4 where all the numbers, except W and T Corporation Income Statement ($ thousands) for the Years Ended 12/31/2017 and 12/31/2018 2017 Sales Cost of goods sold Gross profits Operating expenses Selling, general, and administrative expenses Depreciation expenses Total operating expenses Operating profits Interest expense Earnings before taxes (taxble income) Income taxes Net income Additional information: Number of common shares outstanding Dividends paid to stockholders Market price per share $ $ $ $ $ 5,800 $ (3.600) 2,200 $ (800) (330) (1.130) 1,070 (190) 880 (185) 695 150 $94 $38 2018 5,500 (3,500) 2,000 (750) (500) $ (1,250) $ 750 (275) 475 (100) 375 150 $94 $19 18 W and T Corporation Balance Sheet($ thousands) for 12/31/2017 and 12/31/2018 ASSETS Cash Accounts receivable Inventories Other current assets Total current assets Gross fixed assets Accumulated depreciation Net fixed assets Total assets LIABILITIES (DEBT) AND EQUITY Accounts payable Short-term notes payable Total current liabilities Long-term debt Total liabilities Common equity Common stock Retained earnings Total common equity Total liabilities and equity Print MA SAM $ $ S GA $ $ Done 1,735 2,350 4,550 4,950 (1,600) (2,300) 2,950 2,650 $ 4,685 $ 5,000 $ $ 2017 300 700 600 135 500 350 850 1,250 2,100 $ $ $ S 2018 485 925 780 160 740 400 1,140 1,325 2,465 1,000 1,585 2,585 $ 2,535 4,685 $ 5,000 1,000 1,535 Days in inventories Operating return on assets Operating profit margin Total asset turnover Fixed asset turnover Debt ratio Times interest earned 2017 60.83 days Sales Cost of goods sold Gross profits 2017 22.8% 2017 18.45 % 2017 1.24 X 2017 1.97 X 2017 44.8% 2017 5.63 X 2017 26.9 % Operating expenses Selling, general, and administrative expenses Depreciation expenses Total operating expenses Operating profits Interest expense Earnings before taxes (taxable income) Income taxes Net income S $ 2018 81.34 days $ 2018 15% $ 2018 13.6% 2018 1.10 X 2018 2.08 X 2018 49.3 % 2018 2.73 X 2018 14.8 % (800) (330) S (1,130) $ 1,070 (190) 880 (185) 695 Return on equity (Round to one decimal place.) (2) Complete a common-sized income statement for 2017 and 2018. (Round to one decimal place.) Common-Sized Income Statement ($ thousands) for the Years Ended 12/31/2014 and 12/31/2015 2017 2017 2018 5,800 (3,600) 2,200 (Round to two decimal places.) (Round to one decimal place.) (Round to one decimal place.) (Round to two decimal places.) (Round to two decimal places.) (Round to one decimal place.) (Round to two decimal places) $ 5,500 % (3,500) % $ 2,000 % %. se je a je % % % % % 4 % (750) (500) $ (1,250) $ 750 (275) 475 (100) 375 $ 2018 je je je % % % % % %
Expert Answer:
Answer rating: 100% (QA)
CommonSized Income Statement thousands for the Years Ended 12312017 and 12312018 2017 2018 Sales 5800 5500 Cost of goods sold 3600 3500 Gross profits ... View the full answer
Related Book For
Foundations of Finance The Logic and Practice of Financial Management
ISBN: 978-0132994873
8th edition
Authors: Arthur J. Keown, John D. Martin, J. William Petty
Posted Date:
Students also viewed these finance questions
-
???????Pleaseshow a work.Thank you! A couple wants to save \( \$ 50,000 \) for their new born baby's college education 18 years from now. Assume the parents make an initial investment of \( \$ 10,000...
-
BOTH PARTS PLEASE You believe a stock is poised for a decline and wish to short it. You sell short 630 shares at a price of \( 36.87 \) while having cash equity in your account of 10000 The stock you...
-
Calculate the GPA of a student with the following grades: B (11hours), D (4 hours), F (9hours). Note that an A is equivalent to 4.0, a B is equivalent to a 3.0, a C is equivalent to a 2.0, a D is...
-
Research serves as a guide by which to study, describe, and quantify an array of social and physical phenomenon. Theory, which is best described as a set of propositions or hypotheses that specify...
-
Refrigeration units can be rated in "tons." A 1-ton air conditioning system can remove sufficient energy to freeze 1 ton (2000 pounds = 909 kg) of 0C water into 0C ice in one 24-h day. If, on a 35C...
-
Two similar-looking series are given. Test each one for convergence or divergence. a. b. 00 n=l 1 /n2 + 1 +1
-
List three ways to get input from the console and convert that input to the desired data type.
-
Accounting for bonds using amortized cost measurement based on the historical market interest rate. Several years ago, Huergo Dooley Corporation (HDC) issued $2,000,000 face value, 8% semiannual...
-
Prove that f(xx, yy) = (i=1 (yy) (1/2) x) (i-1 (yy)(1/2)x}) where 1 and 2 refer to periods 1 and 2 respectively; satisfies the condition that: fk(ykx,ykk) = for all k=1,...K then f(yx,y)=\
-
How should a company set price? Is it based on cost position or marketing value? Provide a few examples of companies that clearly use certain price strategies. How does pricing affect brand image?...
-
Consumers looking for other ways to get what they need in tighter times like the movement away from traditional bookstores to tablets is tied to what challenge or opportunity facing marketers today?
-
Discuss the significant trade-off between two competing objectives in hospital information systems. What are the competing objectives? What is the nature of the trade-off? Be detailed and thorough in...
-
Pushpinder is riding on a crowded bus. He has no place to sit, but instead is holding onto one of the overhead straps. Darren is standing next to Pushpinder, also holding onto a strap. Suddenly a car...
-
explain how Tesla apply the 5 performance objectives to operations management.
-
What kind of expenses a greengrocer may incur, and how would you relate the law of diminishing returns to his shop? Identify economies of scale in this enterprise. Quantify the length of the...
-
Each young is endowed with y=20 goods and middle-aged and old are not endowed. Young people would like to consumer half of their endowment when young and the rest either when middle-aged or old....
-
Suppose the government bond described in problem 1 above is held for five years and then the savings institution acquiring the bond decides to sell it at a price of $940. Can you figure out the...
-
The preferred stock of Armlo pays a $ 2.75 dividend. What is the value of the stock if your required return is 9 percent?
-
Discuss the shortcomings of the percent of sales method of financial forecasting.
-
If depreciation is not a cash- flow expense, does it affect the level of cash flows from a project in any way? Why?
-
Using two CST elements, solve the simple shear problem depicted in the figure and determine whether the CST elements can represent the simple shear condition accurately or not. Material properties...
-
A heat conduction problem is modeled using four onedimensional heat conduction elements, as shown in figure 4.6. All elements are of the same length, \(L=1 \mathrm{~m}\), cross sectional area of...
-
Consider heat conduction in a uniaxial rod surrounded by a fluid. The left end of the rod is at \(T_{0}\). The free stream temperature is \(T^{\infty}\). There is convective heat transfer across the...
Study smarter with the SolutionInn App