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Analyze XYZ Boot Company, using ratio analysis. In which I have already done. Just unsure of a couple that are highlighted in yellow.
Analyze XYZ Boot Company, using ratio analysis. In which I have already done. Just unsure of a couple that are highlighted in yellow. I will attach Excel Spreadsheet. I must calculate overall break-even point in sales dollars and the cash break-even point. Compute degree of operating leverage, degree of financial leverage, and degree of combined leverage - clueless of which figures to pull from. we must discuss risks associated with the company, deciding whether bank should loan funds. I will attach a copy of Income Statement/ Balance Sheet to view. Then XYZ Boot company is trying to plan for 2002, then anticipate sales of 20%, which can be absorbed w/o increasing fixed assets. What are their needs for external funds on current balance sheet - Compute required new funds. Noting that notes payable and bonds are not part of the liability calculation. What would required funds be if company brings its ratios into line with industry average for 2002? (Examine receivables turnover, asset turnover, inventory turnover and profit margin) Explain: How would required new funds change if the company were at full capacity? Raised the dividend payout ratio? Suffered a decreased growth in sales? Faced an accelerated inflation rate?Analyze XYZ Boot Company, using ratio analysis. In which I have alreadyI willI must calculate overall break-even point insales dollars and the cash break-even point. Compute degree ofoperating leverage, degree of financial leverage, and degree of combinedleverage - clueless of which figures to pull from. we must discuss risksassociated with the company, deciding whether bank should loan funds.I will attach a copy of Income Statement/ Balance Sheet to view.Then XYZ Boot company is trying to plan for 2002, then anticipate salesof 20%, which can be absorbed w/o increasing fixed assets. What aretheir needs for external funds on current balance sheet - Computerequired new funds. Noting that notes payable and bonds are not part ofthe liability calculation. What would required funds be if companybrings its ratios into line with industry average for 2002? (Examinereceivables turnover, asset turnover, inventory turnover and profitmargin)Explain: How would required new funds change if the company were at fullcapacity? Raised the dividend payout ratio? Suffered a decreased growthin sales? Faced an accelerated inflation rate?Balance Sheet50,00080,0003,000,0001,000,0006,000,0002,000,0008,130,0002,200,000150,000400,0002,500,000Common Stock (1.7 mil)1,700,0001,180,000Total liabilities8,130,000Income Statement â 2001Sales (credit)7,000,000Fixed Costs*2,100,000Variable costs (0.60)4,200,000EBIT 700,000Less: Interest 450,000Earnings after Taxes292,500Dividends (40% payout)117,000Increased retained earnings175,500*Fixed costs include lease expense of $200,000 and depreciation of$500,000.Note: They also have $65,000 per year in sinking funds obligationsassociated with its bond issue. The sinking fund represents an annualrepayment of the principal amount of the bond that is NOT taxdeductible.