Provide help Clorox Company is a leading producer of laundry additives,including Clorox liquid bleach. In the 6 months endedDecember 31, 2011, net sales of $2,526 million produced netearnings of $235 million. To calculate net earnings, Cloroxrecorded $89 million in depreciation and amortization. Otheritems of revenue and expense not requiring cash decreasednet earnings by $21 million. Dividends of $159 million werepaid during the period. Among the changes in balance sheetaccounts during the period were the following ($ in millions),as shown in the table.Accounts receivableInventories$35 Decrease$65 IncreaseAccounts payable and accrued liabilities $136 DecreaseIncome taxes payable$11 DecreaseCompute the net cash provided by operating activities usingthe indirect method.

Step 1: Define Operating Cash FlowThe overall cash flow for a firm during a given accounting period…

Answered: Clorox Company is a leading producer of…

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter12: Corporate Valuation And Financial Planning

Section: Chapter Questions

Problem 6P

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At last year’s end, total assets for Roberts Inc. were $1.2 million and accounts payable were $375,000. Sales, which last year were $2.5 million, are expected to increase by 25 percent this year. Total assets and accounts payable are proportional to sales, and that relationship will be maintained. Robert Inc. typically uses no current liabilities other than accounts payable. Common stock amounted to $425,000 last year, and retained earnings were $295,000. Roberts Inc. plans to sell new common stock in the amount of $75,000. The Firm’s profit margin on sales is 6 percent; and 60 percent of earnings will be retained. Set up Roberts Inc.’s last year balance sheet, to the extent possible, based on the information provided in this problem. Based on the balance sheet setup in Part a above, determine how much was Roberts Inc.’s long-term debt last year? Perform financial forecasting using percent of sales method (i.e., constant ratio method; do not use the AFN Equation) to determine how much…
The average price of a gallon of gas in 2015 dropped $0.94 (28 percent) from $3.34 in 2014 (to $2.40 in 2015). Let’s see whether these changes are reflected in the income statement of Insignia Corporation for the year ended December 31, 2015 (amounts in billions). Insignia reported average net fixed assets of $190 billion in 2015 and $146 billion in 2014. Compute the fixed asset turnover ratios for both years. Did the company better utilize its investment in fixed assets to generate revenues in 2015 or 2014? Insignia reported average stockholders’ equity of $180 billion in 2015 and $146 billion in 2014. The company has not issued preferred stock. Compute the return on equity ratios for both years. Did the company generate greater returns for stockholders in 2015 or 2014?
Macon Mills is a division of Bolin Products, Inc. During the most recent year, Macon had a net income of $36 million. Included in the income was interest expense of $2,300,000. The company's tax rate was 40%. Total assets were $465 million, current liabilities were $108,000,000, and $71,000,000 of the current liabilities are noninterest bearing. What are the invested capital and ROI for Macon? Enter your answer in whole dollar. Round "ROI" answer to two decimal places. Invested Capital $fill in the blank 1 ROI fill in the blank 2%
Macon Mills is a division of Bolin Products, Inc. During the most recent year, Macon had a net income of $44 million. Included in the income was interest expense of $3,000,000. The company's tax rate was 40%. Total assets were $475 million, current liabilities were $109,000,000, and $70,000,000 of the current liabilities are noninterest bearing. What are the invested capital and ROI for Macon? Enter your answer in whole dollar. Round "ROI" answer to two decimal places. Invested Capital $fill in the blank 1 ROI fill in the blank 2%
At the end of last year, Roberts Inc. reported the following income statement (in millions of dollars): Sales $3,000 Operating costs excluding depreciation 2,450 EBITDA $550 Depreciation 250 EBIT $300 Interest EBT Taxes (25%) 124 $176 Net income 44 $132 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 12% higher than the $3 billion in sales generated last year.. Year-end operating costs, excluding depreciation, are expected to equal 70% of year-end sales. Depreciation is expected to increase at the same rate as sales. Interest costs are expected to remain unchanged. ■ The tax rate is expected to remain at 25%. On the basis of that information, what will be the forecast for Roberts' year-end net income? Enter your answer in millions. For example, an answer of $25,400,000 should be entered as 25.40. Do not round intermediate calculations. Round your answer to two decimal places. $ million
At the end of last year, Ralph Inc. reported the following income statement (in millions of dollars): Sales $3,000 Operating costs excluding depreciation 2,450 EBITDA $550 Depreciation 250 EBIT $300 Interest 124 EBT $176 Taxes (25%) 44 Net income $132 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 8% higher than the $3 billion in sales generated last year. Year-end operating costs, excluding depreciation, are expected to equal 65% of year-end sales. Depreciation is expected to increase at the same rate as sales. Interest costs are expected to remain unchanged. The tax rate is expected to remain at 25%. On the basis of that information, what will be the forecast for Ralphs' year-end net income? Enter your answer in millions. For example, an answer of $25,400,000 should be entered as 25.40. Do not round intermediate calculations. Round your answer to two decimal places. $( )million
At the end of last year, Edwin Inc. reported the following income statement (in millions of dollars): Sales $4,100.00 Operating costs excluding depreciation 3,015.00 EBITDA $1,085.00 Depreciation 350.00 EBIT $735.00 Interest 170.00 EBT $565.00 Taxes (40%) 226.00 Net income $339.00 Looking ahead to the following year, the company's CFO has assembled this information: Year-end sales are expected to be 6% higher than $4.1 billion in sales generated last year. Year-end operating costs, excluding depreciation, will equal 70% of sales. Depreciation costs are expected to increase at the same rate as sales. Interest costs are expected to remain unchanged. The tax rate is expected to remain at 40%. On the basis of this information, what will be the forecast for Edwin's year-end net income? Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Enter all values as positive numbers. Do not round intermediate calculations. Round…
Cold Duck Manufacturing Inc. reported sales of $743,000 at the end of last year, but this year, sales are expected to grow by 10%. Cold Duck expects to maintain its current profit margin of 24% and dividend payout ratio of 25%. The following information was taken from Cold Duck’s balance sheet: Total assets: $475,000 Accounts payable: $65,000 Notes payable: $45,000 Accrued liabilities: $70,000 Based on the AFN equation, the firm’s AFN for the current year is_________. A positively signed AFN value represents: -a shortage of internally generated funds that must be raised outside the company to finance the company’s forecasted future growth. -a surplus of internally generated funds that can be invested in physical or financial assets or paid out as additional dividends. -a point at which the funds generated within the firm equal the demands for funds to finance the firm’s future expected sales requirements. Because of its excess…
During the year, Belyk Paving Co. had sales of $2,350,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $1,310,000, $585,000, and $435,000, respectively. In addition, the company had an interest expense of $260,000 and a tax rate of 25 percent. The company paid out $385,000 in cash dividends. Assume that net capital spending was zero, no new investments were made in net working capital, and no new stock was issued during the year. (Ignore any tax loss or carryforward provision and assume interest expense is fully deductible.) Calculate the firm's net new long-term debt added during the year. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Net new long-term debt
Gibraltar Industries is a New York-based manufacturer of high-value-added steel products. In a recent year, it reported the following activities: Acquisitions (Investments in other companies) ($8,724.00) Decrease in inventories $1,770.00 Depreciation and Amortization $33,907.00 Long-Term Debt Reduction ($105,507.00) Net Cash provided by operating activities $107,874.00 Net income $24,068.00 Net proceeds from issuance of common stock $250.00 Net proceeds from sale of property and equipment $2,692.00 Payment of dividends ($5,985.00) Proceeds from long-term debt $53,439.00 Proceeds from sale of other equity investments $34,701.00 Purchase of property, plant, and equipment ($21,595.00) Required: 1. Based on this information, present the cash flows from investing and financing activities section of the cash flow statement.
Gibson Corporation’s balance sheet indicates that the company has $580,000 invested in operating assets. During the year, Gibson earned operating income of $67,280 on $1,160,000 of sales. Required Compute Gibson’s profit margin for the year. Compute Gibson’s turnover for the year. Compute Gibson’s return on investment for the year. Recompute Gibson’s ROI under each of the following independent assumptions:(1) Sales increase from $1,160,000 to $1,392,000, thereby resulting in an increase in operating income from $67,280 to $76,560.(2) Sales remain constant, but Gibson reduces expenses, resulting in an increase in operating income from $67,280 to $69,600.(3) Gibson is able to reduce its invested capital from $580,000 to $464,000 without affecting operating income.
Delta Ray Brands Corp. just completed their latest fiscal year. The firm had sales of $16,818,300. Depreciation and amortization was $830,300, interest expense for the year was $872,900, and selling general and administrative expenses totaled $1,404,600 for the year, and cost of goods sold was $10,640,400 for the year. Assuming a federal income tax rate of 34%, what was the Delta Ray Brands net income after-tax? Round to the nearest cent.

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