Fibertech GmbH is a distributor of outdoors technical clothing. The company outsources the production of clothing...

  

 

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Fibertech GmbH is a distributor of outdoors technical clothing. The company outsources the production of clothing to external manufacturers in Bangladesh and sells the clothing under its own brands. Below you are provided with the balance sheet at the end of x3 and x4, and the profit & loss and cash T- accounts for x4. Note that some numbers are missing in the T-accounts. You'll have to infer them in the questions below. Fibertech GmbH Balance sheets at 31 December x3 and x4 (amounts in €000) Dec 31, x3 Dec 31, x4 Non-current assets Brands 50 90 Land Building and equipment, gross less: Accumulated depreciation Building and equipment, net Total non-current assets 200 200 540 580 (484) (474) 56 306 106 396 Current assets Inventories Accounts receivable 250 350 500 400 Prepaid insurance 6 Cash Total current assets 340 994 239 1.095 Total assets 1.300 1.491 Shareholders' equity Share capital Retained profits Total shareholders' equity 170 120 290 170 426 596 Non-current liabilities Long-term bank loan 600 450 Current liabilities Short-term portion of long-term bank loan Accounts payable Тахes payable Interest payable Total current liabilities 150 150 200 250 35 25 25 410 20 445 Total liabilities and shareholders' equity 1.300 1.491 Profit and loss year x4 Debit Credit - BB Cost of goods sold 1.400 Depreciation expense 2.200 Total sales 40 15 Gain on sale of buildings and equipment Selling and administration salaries 240 Insurance expense Interest expense ? ? Income taxes ? 336 Net Income Cash Debit Credit BB 340 ? Payments to suppliers 120 Purchase of equipment 240 Payments of salaries 36 Prepayments of insurance 60 Payments of interest on loans 150 Loan repayment 120 Payments of taxes ? Payments of dividends 40 Purchase of brand Receipts from customers 2.100 Proceeds from sale of 45 buildings and equipment ЕВ 239 Additional note: Fibertech estimates its brands have an indefinite life and consequently they are not amortized. Project Title * Give your project a descriptive title Briefiy discuss Fibertech's financial statements. (Please comment on its financial position, profitability, liquidity and whatever relevant information you can interpret from the financial statements.) B If you were a shareholder in Fibertech sitting in the Board of Directors, based on the information you read in the financial statements, what further relevant questions would you ask to get a more complete picture of the business performance? Part il of the final quiz is a peer-to-peer assessment. Once you have submitted your own work, you will be asked to review three of your peers' answers to the same questions. Each of the two question is worth up to four points. Your answer needs to cover at least four ideas/criteria indicated in the PDF solution in order to obtain the full four points. However, for the first question, there are five possible ideas you can come up with in your answer and for the second question there are seven. So i, for example, you address five of the ideas listed in the solution key, you still get four points. Partial credit: You can obtain half a point if you partially address one of the ideas that Prof. Badia lists in the solution. Please note: The passing threshold is 75%, The solution will only become available to you once you have completed and submitted your own quiz. Criteria: For each question, Prof. Badia has provided an example of the type of criteria you should strive to address to receive the coresponding points. To receive a point for each idea, you should not just make assertions, but also arguments that offer supporting evidence. For example, if you state, "Fibertech is very profitable," the statement may be correct, but it's not enough to earn a full point. However, the statement would earn half a point. For the full point, you should make the statement and explain why: Why is it profitable? What categories on the financial statements allow you to arrive at this conclusion? In other words, you should say something along these lines: Fibertech is very profitable. The net profit is XYZ. The return on sales is X% (i.e. Net profit / Sales = XYZ/ ABC). The return on equity is XX% (i.e. Net profit / Average owner's equity for the year = XYZ / LX + YYYV2) = XX%). Fibertech GmbH is a distributor of outdoors technical clothing. The company outsources the production of clothing to external manufacturers in Bangladesh and sells the clothing under its own brands. Below you are provided with the balance sheet at the end of x3 and x4, and the profit & loss and cash T- accounts for x4. Note that some numbers are missing in the T-accounts. You'll have to infer them in the questions below. Fibertech GmbH Balance sheets at 31 December x3 and x4 (amounts in €000) Dec 31, x3 Dec 31, x4 Non-current assets Brands 50 90 Land Building and equipment, gross less: Accumulated depreciation Building and equipment, net Total non-current assets 200 200 540 580 (484) (474) 56 306 106 396 Current assets Inventories Accounts receivable 250 350 500 400 Prepaid insurance 6 Cash Total current assets 340 994 239 1.095 Total assets 1.300 1.491 Shareholders' equity Share capital Retained profits Total shareholders' equity 170 120 290 170 426 596 Non-current liabilities Long-term bank loan 600 450 Current liabilities Short-term portion of long-term bank loan Accounts payable Тахes payable Interest payable Total current liabilities 150 150 200 250 35 25 25 410 20 445 Total liabilities and shareholders' equity 1.300 1.491 Profit and loss year x4 Debit Credit - BB Cost of goods sold 1.400 Depreciation expense 2.200 Total sales 40 15 Gain on sale of buildings and equipment Selling and administration salaries 240 Insurance expense Interest expense ? ? Income taxes ? 336 Net Income Cash Debit Credit BB 340 ? Payments to suppliers 120 Purchase of equipment 240 Payments of salaries 36 Prepayments of insurance 60 Payments of interest on loans 150 Loan repayment 120 Payments of taxes ? Payments of dividends 40 Purchase of brand Receipts from customers 2.100 Proceeds from sale of 45 buildings and equipment ЕВ 239 Additional note: Fibertech estimates its brands have an indefinite life and consequently they are not amortized. Project Title * Give your project a descriptive title Briefiy discuss Fibertech's financial statements. (Please comment on its financial position, profitability, liquidity and whatever relevant information you can interpret from the financial statements.) B If you were a shareholder in Fibertech sitting in the Board of Directors, based on the information you read in the financial statements, what further relevant questions would you ask to get a more complete picture of the business performance? Part il of the final quiz is a peer-to-peer assessment. Once you have submitted your own work, you will be asked to review three of your peers' answers to the same questions. Each of the two question is worth up to four points. Your answer needs to cover at least four ideas/criteria indicated in the PDF solution in order to obtain the full four points. However, for the first question, there are five possible ideas you can come up with in your answer and for the second question there are seven. So i, for example, you address five of the ideas listed in the solution key, you still get four points. Partial credit: You can obtain half a point if you partially address one of the ideas that Prof. Badia lists in the solution. Please note: The passing threshold is 75%, The solution will only become available to you once you have completed and submitted your own quiz. Criteria: For each question, Prof. Badia has provided an example of the type of criteria you should strive to address to receive the coresponding points. To receive a point for each idea, you should not just make assertions, but also arguments that offer supporting evidence. For example, if you state, "Fibertech is very profitable," the statement may be correct, but it's not enough to earn a full point. However, the statement would earn half a point. For the full point, you should make the statement and explain why: Why is it profitable? What categories on the financial statements allow you to arrive at this conclusion? In other words, you should say something along these lines: Fibertech is very profitable. The net profit is XYZ. The return on sales is X% (i.e. Net profit / Sales = XYZ/ ABC). The return on equity is XX% (i.e. Net profit / Average owner's equity for the year = XYZ / LX + YYYV2) = XX%).

Answer rating: 100% (QA)

1 Net profit of 336 Return on sales of 1527 Return on equity of 198 2 From looki... View the full answer