Questions 1 through 20 are based on the following balance sheet and income statement for the last two years of a company

[answerhappygod]

Questions 1 Through 20 Are Based On The Following Balance Sheet And Income Statement For The Last Two Years Of A Company 1 (194.25 KiB) Viewed 33 times

Questions 1 through 20 are based on the following balance sheet and income statement for the last two years of a company. Balance Sheet December 31, 2020 ($000s) Current Assets $ 50 Current Liabs. $ 45 Fixed Assets $750 LT Debt $100 Stock $400 Add to R/E. $255 Total $800 Total $800 December 31, 2021 ($000s) Current Assets $ 52 Current Liabs $ 48 Fixed Assets. $825 LT Debt $110 Stock $420 Add to R/E. $299 Total $877 Total $877 2020 Income Statement ($000s) Revenues Costs Depreciation EBIT Interest Taxable Income Tax (40%) Net Income $280 $100 $ 75 $105 $ 10 $ 95 $ 38 $ 57 2021 Income Statement ($000s) Revenues $320 Costs $114 Depreciation. $ 82 EBIT $124 Interest $ 11 Taxable Income. $113 Tax (40%) $ 45 Net Income $ 68 1. (2 points) What is 2020's Operating Cash Flow? 2. (2 points) What is 2021's Operating Cash Flow? 3. (2 points) What is the change in Net Working Capital from 2020 to 2021? 4. (2 points) What is Net Capital Spending in 2021? 5. (2 points) How many dividends were paid in 2021? 6. (2 points) What is 2021's Cash Flow from Assets? 7. (2 points) What is 2021's Cash Flow to Creditors? 8. (2 points) What is 2021's Cash Flow to Stockholders? 9. (2 points) What is 2021’s Debt to Equity Ratio? 10. (2 points) What is 2021's retention ratio (take to 4 decimal points, eg. O.xxxx)

11. (2 points) What is 2021's Return on Assets? 12. (2 points) What is 2021's Return on Equity? 13. (2 points) What is 2021's Internal Growth Rate? 14. (2 points) What is 2021's Sustainable Growth Rate? 15. (2 points) If in 2022 the company grows at a rate between the Internal Growth Rate and the Sustainable Growth rate and any external funding needed is met by debt, what will happen to the Debt to Equity Ratio? 16. (2 points) If in 2022 the company grows at a rate more than the sustainable growth rate, what will happen to the Debt to Equity Ratio if the company meets external funding needed with: a. All debt b. All equity 17. (2 points) Let's say that in 2022 Total Assets grow by 12%. What would 2022 Total Equity have to be so that 2022's Debt to Equity Ratio is the same as in 2021? 18. (2 points) What is the simplest thing the company can do to increase its Internal Growth Rate and Sustainable Growth Rate? 19.(4 points) Describe (in words) what would happen to the company's Operating Cash Flow if in 2022 depreciation expense was: a. Increased

17. (2 points) Let's say that in 2022 Total Assets grow by 12%. What would 2022 Total Equity have to be so that 2022's Debt to Equity Ratio is the same as in 2021? 18. (2 points) What is the simplest thing the company can do to increase its Internal Growth Rate and Sustainable Growth Rate? 19. (4 points) Describe (in words) what would happen to the company's Operating Cash Flow if in 2022 depreciation expense was: a. Increased b. Decreased 20. (4 points) Describe (in words) what would happen to the company's Cash Flow from Assets if in 2022 depreciation expense was: a. Increased b. Decreased 21. (3 points) Three companies have the same level of assets and net income, but the Internal Growth Rates are 5.50% for Company A, 4.75% for Company B and 6.25% for Company C. Rank the companies from highest to lowest in terms of their retention ratios. 22. (3 points) Three companies have the same net income and total equity. The retention ratios are 60% for Company X, 50% for Company Y and 40% for Company Z. Rank the companies from highest to lowest in terms of their Sustainable Growth Rates.