Balance Sheets as of December 31 2015 2014 Assets Cash and equivalents $ 14,000 $ 13,000 Accounts receivable 30,000 25,000 Inventories 28,125 21,000 $ 72,125 50,000 $122,125 Total current assets $ 59,000 Net plant and equipment 47,000 Total assets $106,000 Liabilities and Equity Accounts payable $ 10,800 $ 9,000 Accruals 7,600 6,000 Notes payable 6,700 5,150 Total current liabilities $ 25,100 $ 20,150 Long-term bonds 15,000 15,000 Total liabilities $ 40,100 $ 35,150 Common stock (5,000 shares) 50,000 50,000 Retained earmings 32,025 20,850 $ 82,025 $122,125 Common equity $ 70,850 Total liabilities and equity $106,000 Income Statement for Year Ending December 31, 2015 Sales $214,000 Operating costs excluding depreciation and amortization 170,000 EBITDA $ 44,000 Depreciation & amortization 5,000 EBIT $ 39,000 Interest 1,750 EBT $ 37,250 Taxes (40%) 14,900 Net income $ 22,350 Dividends paid $ 11,175

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 9.4.10P: Twenty metrics of liquidity, solvency, and profitability The comparative financial statements of...
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Bailey Corporation’s financial statements (dollars and shares are in
‘millions) are provided here.

a.What was net operating working capital for 2014 and 20152
b.What was Bailey’s 2015 free cash flow?
c.Construct Bailey’s 2015 statement of stockholders” equity.
d.What was Bailey’s 2015 EVA? Assume that its after-tax cost of capital is 10%.
e.What was Bailey’s MVA at year-end 20152 Assume that its stock price at December 31, 2015 was $20. LY

 

Balance Sheets as of December 31
2015
2014
Assets
Cash and equivalents
$ 14,000
$ 13,000
Accounts receivable
30,000
25,000
Inventories
28,125
21,000
$ 72,125
50,000
$122,125
Total current assets
$ 59,000
Net plant and equipment
47,000
Total assets
$106,000
Liabilities and Equity
Accounts payable
$ 10,800
$ 9,000
Accruals
7,600
6,000
Notes payable
6,700
5,150
Total current liabilities
$ 25,100
$ 20,150
Long-term bonds
15,000
15,000
Total liabilities
$ 40,100
$ 35,150
Common stock (5,000 shares)
50,000
50,000
Retained earmings
32,025
20,850
$ 82,025
$122,125
Common equity
$ 70,850
Total liabilities and equity
$106,000
Income Statement for Year Ending December 31, 2015
Sales
$214,000
Operating costs excluding depreciation and amortization
170,000
EBITDA
$ 44,000
Depreciation & amortization
5,000
EBIT
$ 39,000
Interest
1,750
EBT
$ 37,250
Taxes (40%)
14,900
Net income
$ 22,350
Dividends paid
$ 11,175
Transcribed Image Text:Balance Sheets as of December 31 2015 2014 Assets Cash and equivalents $ 14,000 $ 13,000 Accounts receivable 30,000 25,000 Inventories 28,125 21,000 $ 72,125 50,000 $122,125 Total current assets $ 59,000 Net plant and equipment 47,000 Total assets $106,000 Liabilities and Equity Accounts payable $ 10,800 $ 9,000 Accruals 7,600 6,000 Notes payable 6,700 5,150 Total current liabilities $ 25,100 $ 20,150 Long-term bonds 15,000 15,000 Total liabilities $ 40,100 $ 35,150 Common stock (5,000 shares) 50,000 50,000 Retained earmings 32,025 20,850 $ 82,025 $122,125 Common equity $ 70,850 Total liabilities and equity $106,000 Income Statement for Year Ending December 31, 2015 Sales $214,000 Operating costs excluding depreciation and amortization 170,000 EBITDA $ 44,000 Depreciation & amortization 5,000 EBIT $ 39,000 Interest 1,750 EBT $ 37,250 Taxes (40%) 14,900 Net income $ 22,350 Dividends paid $ 11,175
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