Given answer with calculation GreenAgri Ltd. is a company engaged in theproduction and distribution of agriculturalfertilizers and chemicals. The companymanufactures various nitrogen-based andphosphate-based fertilizers for commercialfarming and industrial use. The average P/E ratiofor companies in the agricultural chemicalindustry, similar to GreenAgri Ltd., is 18. IfGreenAgri Ltd.'s projected earnings per share(EPS) are $5, what should be its estimated shareprice based on the industry average P/E ratio?

To estimate GreenAgri Ltd.'s share price based on the industry average Price-to-Earnings (P/E)…

Answered: GreenAgri Ltd. is a company engaged in…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 3MAD: Deere Company (DE) manufactures and distributes farm and construction machinery that it sells...

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Cobalt Industries had sales of 148,100 units at a price of $9.08 per unit. It faced fixed operating costs of $240,000 and variable operating costs of $4.56 per unit. The company is subject to a tax rate of 38% and has a weighted average cost of capital of 8.7%. Calculate Cobalt's net operating profits after taxes (NOPAT), and use it to estimate the value of the firm. (Assume the firm's earnings are not growing.) Cobalt's NOPAT is $ (Round to the nearest dollar.) (...
Vernon Corporation makes and sells state-of-the art electronics products. One of its segments produces the math machine, an in expensive calculator. The company's chief accountant recently prepared the following income statement showing annual revenues and expnses associated with the segment's operating activities. The relevant range for the production and sale of the range for the production and sale of the calculators is between 33,000 and 71,000 units per year. Revenue (47,000 unitsx9.00) $423,000 Unit-level variable costs Materials cost (47,000x$2.00) ($94,000) labor cost (47,000x1.00) ($47,000) manufacturing overhead (47,000x $0.20) ($9,400) shipping and handling (47,000x $0.24) ($11,280) Sales commissions (47,000x$2.00) ($94,000) contribution margin $167,320 Fixed expenses Advertising costs ($30,000) Salary of production supervisor ($66,000) Allocated company-wide facility-level expenses ($82,000) Net loss ($10,680) Required A) A large discount store has approached the…
Patterson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. PATTERSON COMPANY Income Statements for the Year 2014 Segment Sales Cost of goods sold А В C $164,000 $250,000 $245,000 (84,000) (29,000) |(130,000) (18,000) (80,000) (22,000) Sales commissions Contribution margin 143,000 16,000 137,000 General fixed oper. exp. (allocation of president's salary) Advertising expense (specific to individual divisions) (37,000) (32,000) (34,000) (5,000) (11,000) 0 (26,000) $ 94,000 $ 109,000 Net income Required: a. Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Effect on income b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. PATTERSON COMPANY Comparative Income Statements for the Year 2014 Eliminate Seg. A Decision Keep Seg. A Sales Cost…
The Hydride Division of Murdoch Corporation is an investment center. It has $1,000,000 of operating assets. During 2015, the Hydride Division earned operating income of $400,000 on $6,000,000 of sales. Murdoch's companywide return on investment or desired rate of return is approximately 10%. a. What is the ROI? b. What is the margin? c. What is the turnover? d. What is the residual income?
Following are data for BioBeans and GreenKale, which sell organic produce and are of similar size. 1. Compute the profit margin and the return on total assets for both companies. 2. Based on analysis of these two measures, which company is the preferred investment?
Noble Company has two divisions, the Domestic Division and the International Division. Last year, the Domestic Division earned $360,000 using average operating assets of $1,440,000. Sales for the Domestic Division were $3,600,000. Last year, the International Division earned $560,000 using average operating assets of $2,800,000. Sales for the International Division were $7,000,000. A. For the Domestic Division, margin is __________________ Turnover is __________________ and ROI is __________________. B. For the International Division, margin is __________________ Turnover is __________________ and ROI is __________________. C. If these are the only two divisions of Noble Company, what is ROI for Noble Company?
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Swann Systems is a small but fast-growing company headquartered in Bangalore, India. Bangalore is known as the "Silicon Valley of India" because of its role in the nation's leading information technology (IT) sector. The company's Corporate FP&A Department is forecasting the following income statement for the upcoming year: Sales Operating costs (excluding depreciation) Gross margin Depreciation EBIT Interest EBT Taxes (40%) Net income $5,000,000 $3,000,000 $2,000,000 $500,000 $1,500,000 $500,000 $1,000,000 400,000 $ 600,000 The company's CEO is disappointed with the forecast and would like to see Swann Systems generate higher sales. and a forecasted net income of $3,000,000. Assume that operating costs (excluding depreciation) are always 60 percent of sales. Also, assume that depreciation, interest expense, and the company's tax rate, which is 40 percent, will remain the same even if sales change. What level of sales revenues would Swann have to obtain to generate $3,000,000 in net…
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Rundle Corporation makes and sells state-of-the-art electronics products. One of its segments produces The Math Machine, an inexpensive calculator. The company's chief accountant recently prepared the following income statement showing annual revenues and expenses associated with the segment's operating activities. The relevant range for the production and sale of the calculators is between 32,000 and 72,000 units per year. Revenue (35,000 units x $12.00) Unit-level variable costs Materials cost (35,000 x $3.00) Labor cost (35,000 x $2.00) Manufacturing overhead (35,000 x $0.20) Shipping and handling (35,000 x $0.28) Sales commissions (35,000 × $2.00) Contribution margin Fixed expenses Advertising costs Salary of production supervisor Allocated companywide facility-level expenses Net loss Required $ 420,000 (105,000) (70,000) (7,000) (9,800) (70,000) 158,200 (27,000) (67,000) (83,000) $ (18,800) a. A large discount store has approached the owner of Rundle about buying 6,000…
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Indi Systems Inc., headquartered in Bengaluru, India, provides specialized information technology (IT) services and consists of three divisions: (1) insurance, (2) retail and (3) hospitality. For 2023, it recorded the following data: Sales revenues Variable costs (% of sales) Traceable fixed costs Common fixed costs 2. Which segment is most profitable? Insurance $ 4,500,000 2,150,000 O Insurance O Retail O Hospitality 30% Retail $ 5,594,000 2,768,450 Insurance Indi Systems Inc., Segment Performance Report Profit Centres 40% Retail Required: 1. Prepare a segment performance report showing the segment margin in dollars and percentages for all three divisions. Use Exhibit 12-3 as a guide. (Round "Percentage" answers to 1 decimal place, (i.e., 0.123 should be considered as 12.3%).) Hospitality $ 1,970,000 % 45% 730,560 Hospi Total $ 12,064,000 % 5,649,010 1,590,000 Total pany

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