Considering 2012 as the base year, you are required to compute the trend index for the following items: Revenue, cost of goods sold, total expenses and net earnings. Comment on the trends of each of the items. Total assets, total liabilities and shareholders’ equity. Comment on the trends of each of the items. Cash flow from operation, cash flow from investing, cash flow from financing and closing cash balances. Comment on the trends of each of the items.
Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
Considering 2012 as the base year, you are required to compute the trend index for the following items:
- Revenue, cost of goods sold, total expenses and net earnings. Comment on the trends of each of the items.
- Total assets, total liabilities and shareholders’ equity. Comment on the trends of each of the items.
- Cash flow from operation, cash flow from investing, cash flow from financing and closing cash balances. Comment on the trends of each of the items.
![*Carperale finar lallalr, rigklarerd.
Historical Results
FINANCIAL STATEMENTS
2012
2013
2014
2015
2016
2017
Income Statement
Revenue
158,311
102,007
39,023
62,984
118,086
131,345
49,123
82,222
142,341
150,772
56,710
94,062
Cost of Goods Sold (COGS)
48,004
70,082
52,654
89,687
58,575
99,736
Gross Profit
Еxрenses
22,658
10,125
18,150
23,002
11,020
16,544
Salaries and Benefits
26,427
10,963
19,500
2,500
59,390
3,594
23,872
10,087
17,205
25,245
11,412
16,080
26,913
10,000
15,008
Rent and Overhead
Depreciation & Amortization
Interest
Total Expenses
Earnings Before Tax
2,500
1,500
1500
52,066
37,622
1,500
54,237
39,825
1.500
53,433
16,649
52,664
29,558
53,421
46,314
Taxes
1.120
2,474
4,858
11,791
8.483
21,075
11,598
10,908
26,713
12,968
33,346
Net Earnings
28,227
Balance Sheet
Assets
181,210
5,904
Cash
167,971
5,100
7,805
183,715
6,567
9,825
211,069
7,117
10,531
38,602
267,319
239,550
7,539
11,342
272,530
7,807
11,715
Accounts Receivable
Inventory
Property & Equipment
Total Assets
9,601
45,500
42,350
40.145
37,521
37,513
226,376
239,065
240,252
295,951
329,564
Liabilities
Accounts Payable
Debt
3,902
4,800
50,000
4,912
5,265
50,000
53,902
30,000
34,912
5,671
30,000
5,938
30,000
35,938
30,000
Total Liabilities
54,800
35,265
35,671
Shareholder's Equity
Equity Capital
Retained Earnings
Shareholder's Equity
Total Liabilities & Shareholder
170,000
170,000
170,000
35,340
205,340
240,252
170,000
62.053
170,000
170,000
123,627
293,627
2,474
14,265
90,280
260,280
172,474
184,265
232,053
226,376
239,065
267,319
295,951
329,564
Cash Flov Statement
Operating Cash Flow
Net Earnings
Plus: Depreciation & Amortization
Less: Changes in Working Capital
Cash from Operations
2,474
19,500
9,003
11,791
18,150
1,702
28,239
21,075
26,713
28,227
33,346
17,205
16,544
16,080
15,008
775
903
827
375
12,971
37,505
42,354
43,480
47,980
Investing Cash Flow
Investments in Property & Equipment
Cash from Investing
15,000
15,000
15,000
15,000
15,000
15,000
15,000
15,000
15,000
15,000
15,000
15,000
Financing Cash Flov
Issuance (repayment) of debt
Issuance (repayment) of equity
Cash from Financing
(20,000)
170,000
170,000
[20,000)
Net Increase (decrease) in Cash
Opening Cash Balance
Closing Cash Balance
167,971
13,239
167.971
2,505
181,210
183,715
27,354
28,480
211,069
239,550
32,980
183,715
211,069
239,550
272,530
167,971
181,210](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc77fc9e5-96a1-406a-8c87-27a7ecc654b2%2F99e3aca5-bc8f-4bf2-8527-adeaf1189347%2F1cun5y_processed.png&w=3840&q=75)
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