Calculate the ratios for xyz plumbing 2014

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Reference no: EM131794612

Use the following information about XYZ Plumbing (FY=12/31), a public company with the most recent closing stock price of $5.00, to answer the following three problems

Income Statement

2013

2014

Revenue

10,000,000

12,000,000

CGS

4,000,000

4,800,000

Gross Profit

6,000,000

7,200,000

SG&A

1,800,000

2,000,000

R&D

1,000,000

1,000,000

Deprec & Amort

500,000

550,000

Total Op. Expense

3,300,000

3,550,000

Operating Profit

2,700,000

3,650,000

Interest cost

520,000

600,000

Interest income

90,000

110,000

Pre-Tax

2,270,000

3,160,000

Tax (35% rate)

794,500

1,106,000

Net Income

1,475,500

2,054,000

EPS - Basic

0.15

0.21

Average Shares Outstanding

10,000,000

10,000,000

Balance Sheet

ASSETS

2013

2014

LIABILITIES

2013

2014

Cash

2,500,000

4,154,000

Accounts Payable

500,000

500,000

A/R

1,000,000

1,500,000

Notes Payable

1,500,000

1,000,000

Inventory

2,000,000

2,300,000

Current portion of LTD

1,000,000

1,000,000

Pre-paid expenses

1,000,000

670,000

Accrued Liabilities

500,000

520,000

Total Current Assets

6,500,000

8,624,000

Total Current Liabilities

3,500,000

3,020,000

Building and Improvements

15,000,000

15,000,000

Long-Term Debt

12,000,000

14,000,000

Equipment

5,000,000

7,000,000

 

 

 

 

20,000,000

22,000,000

Stockholder's Equity

 

 

 

 

 

Common Stock at Par

100,000

100,000

Depreciation

500,000

1,050,000

Paid in Capital

9,900,000

9,900,000

Net PP&E

19,500,000

20,950,000

Retained Earnings

500,000

2,554,000

 

 

 

Total Stockholder's Equity

10,500,000

12,554,000

Total Assets

26,000,000

29,574,000

Total Liabilities + Equity

26,000,000

29,574,000

1. Complete the following cash Flow Statement for XYZ Plumbing for 2014

2. Calculate the following ratios for XYZ Plumbing 2014:

3. Fill in the projections for XYZ Plumbing for 2015, based on the following assumptions:

1. Revenue grows by 25% between 2014 and 2015.
2. Gross Margins remain at 2014 levels.
3. SG&A improves by 1% (as a % of revenue)
4. R&D increases by 20%.
5. Depreciation and Amortization costs do not change between 2014 and 2015.
6. Interest costs and expenses are given in the table below.
7. The tax rate remains constant.
8. The Average Shares Outstanding is the same as it was in 2014.
9. Options and Warrants are listed in the following table:

Options Amount Exercise Price Public Warrants Amount Exercise Price
Officers and Directors 2,000,000 $2.00 Shareholders 4,000,000 $3.00

Reference no: EM131794612

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