Cash flow.. I can’t get the cash flow to balance! FINA2360 SSI 2018 Assignment #

Question

Cash flow.. I can’t get the cash flow to balance! FINA2360 SSI 2018 Assignment #4 Dapper Dawg Industries Income Statement ($000's) Forecast 2017 2018 2016 Sales Revenues 3,432,0000 5,834,400.0 7,035,600.0 Cost of Goods Sold Contribution Margin Operating Expenses Depreciation Interest Earnings 84 Taxes Taxes @ 40% 2,864.000.0 4,980,000.0 5,800 000.0 568000.0854,400.0 ,235,600.0 40,000.0720,000.0 612,960.0 18,9000 116,960.0 120,?0.0 62,500.0 176,000.080,00.0 146 6000158.5600422,640. s6400, 63424.0 169.0% o 0- 95,136.0 253,584 0 Earnings After tax Other Data that may 12.17 Stock Price850S6.00 100,000100,000 250,000 .014 Shares o/s 0880 5 0.951 0220 0110 Tax Rate Book Value per Share Lease Payments 6.638 5 5.576 7.909 s 40,000 40,000 40,000 Industry st Average 0.8 1.0 inventory Turnover Day's Sales Outstanding Fixed Assets Turnover Total Asset Turnover Total Debe Ratio 2.0 80,7 54.8 26% 13.3% 50.0 Profit Margin Ratio Returm Return on Equity Price Earnings Ratio Price/Cash Flow 1,6% 36% 90% 179% 16.2 on Assets ,17.2% 9.7 N/A a. Complete the cash flow statement for 2018 (S marks) b. Complete a common size statement for Dapper Dawg Industries for both years and the forecast using an excel spreadsheet. (5 marks) c. Complete the ratios using an excel spreadsheet.(5 marks) d. Use the Dupont ratio to calculate the ROE and which ratio should the firm try to improve? (4 marks) Do you observe any weakness or concerns in the frm'r e.

Explanation / Answer

Notes

1. Dividends Paid = Opening Balance of Retained Earnings + Earnings After Tax for 2018 - Closing Balance of Retained Earnings.

Q (a) Dapper Dawg Industries Statement of Cash Flows For the year ended 2018 S.No. Particulars Amount $ Amount $ A Cash Flow from Operations Earnings after Tax       25,35,84,000 Add Adjustments to convert Earnings into Cash basis: i. Depreciation          12,00,00,000 ii. Decrease (Increase) in Short Term Invesments          -5,16,32,000 iii. Decrease (Increase) in Accounts Receivable        -24,58,40,000 iv. Decrease (Increase) in Inventory        -42,91,20,000 v. Increase (Decrease) in Accounts Payable            3,58,00,000 vi. Increase (Decrease) in Notes Payable        -42,00,00,000 vii Increase (Decrease) in Accrued Expenses            9,50,40,000 Total Adjustments     -89,57,52,000 A Net Cash provided by operating activities     -64,21,68,000 B Investment Activities: i Addition to Plant & Equipment          -1,70,50,000 B Net Cash used in Investing Activities       -1,70,50,000 C Financing Activities: i Repayment of Long Term debt        -50,00,00,000 ii Issuance of Common Stock      1,22,09,36,000 iii Dividends Paid -See Note below          -5,50,00,000 C Net Cash used in Financing Activities 66,59,36,000 I Net Increase (Decrease) in cash/ Cash Equivalents(A+B+C)             67,18,000 II Add : Opening Balance of Cash             72,82,000 III Closing Balance of Cash 1,40,00,000

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