Required: Complete the purple areas of the chart, and the questions in the text boxes below.
List the years in order of most recent as year 1, next most recent as year 2, etc. Example: If
the most recent fiscal year was 2015, then replace Year 1 with 2015, replace Year 2 with 2014,
and replace Year 3 with 2013.
In the References box, include an APA reference for all information retrieved, whether from the Tootsie Roll we
itself, specific forms (i.e. 10k) from the Tootsie Roll website, or other outside sources.
Instructions for citing a 10k or Annual Report: http://rasmussen.libanswers.com/faq/32821 For general APA he
visit the APA Guide: http://guides.rasmussen.edu/apa
Tootsie Roll Industries Inc.
Income Statement
Total Revenue
Product Cost of Goods Sold
Rental and Royalty Cost
Total Gross Margin
Selling, Marketing and Administrative Expenses
Earnings from Operations
Income Taxes
Net Earnings
2015
540,112
340,090
889
199,133
108,051
91,082
26,451
66,127
2014
543,525
340,933
947
201,645
117,722
83,923
28,434
62,860
Question 1: What is Tootsie Roll's Gross Profit Margin? (Hint: Divide Total Gross Margin by Total Revenue). What
figure represent?
Gross profit margin= 36.632%
It shows the rate at which money is generated from sales after substracting cost of goods sold
Question 2:What is Tootsie Roll's Profit Margin? (Hint: Profit margin is calculated by dividing Net Earnings by Total Sales)
What does this figure represent?
profit margin=12.32%
Is shows the rate at which net profits are generated from sales in a company
Question 3: What are Tootsie Roll's earnings per share in the three years presented? (Hint: Check the income statement
after Net Earnings for this information.)
2013= 0.93
2014= 0.99
2015= 1.04
Question 4: According to note 1 in the Notes to the Consolidated Financial Statements, how does Tootsie Roll Industries
recognize revenue?
manufacture and sales of candy product
Question 5: Has Net Product Sales shown an increasing or decreasing trend over the past three years? Interpret this tren
Should this be a concern for the company? Why or why not?
The net trend has decreased over the past three years. There is a concern for the future of this company due to its trend
This might be due to increased competition in the industry or entry of new firms into the market.
Question 6: Has the Net Earnings shown an increasing or decreasing trend over the past three years? Interpret this trend
Should this be a concern for the company? Why or why not?
Net earnings has increased for the past three years. The reason being the company might have decrease the aftersales
services, expenses and the suppliers might have decreased the prices of their products making the cost of goods sold.
Question 7: Compare the Net Product Sales trend and the Net Earnings trend. Are these two items trending the same?
Interpret any differences and infer what those may mean in relation to the company's operating decisions over the past
three years.
The net product sales has been decreasing and the net earnings has been increasing.
This means that the company has been able to earn increasingly despite decrease in sales. The cost of goods rom the
suppliers might have reduced. The company might have considered in reducing expenses incured in the company.
This means that the company has been able to earn increasingly despite decrease in sales. The cost of goods rom the
suppliers might have reduced. The company might have considered in reducing expenses incured in the company.
References: (Hint! Citing a 10K and/or Annual Report: http://rasmussen.libanswers.com/faq/32821 ; APA Guide:
http://guides.rasmussen.edu/apa )
https://www.last10k.com/sec-filings/tr/0001104659-13-016402.htm#ITEM8FinancialStatementsandSupplementary
file:///H:/Annual%20Report%202015%20(pdf).pdf
er from the Tootsie Roll website
/32821 For general APA help,
2013
543,383
350,960
937
191,486
119,133
72,353
23,634
60,849
Total Revenue). What does this
ng Net Earnings by Total Sales).
Check the income statement
w does Tootsie Roll Industries, Inc.
hree years? Interpret this trend.
this company due to its trend.
ree years? Interpret this trend.
have decrease the aftersales
king the cost of goods sold.
o items trending the same?
ating decisions over the past
The cost of goods rom the
ncured in the company.
The cost of goods rom the
ncured in the company.
q/32821 ; APA Guide:
mentsandSupplementary
Required: Complete the purple areas of the chart, and the questions in the text boxes below.
List the years in order of most recent as year 1, next most recent as year 2, etc. Example: If
the most recent fiscal year was 2015, then replace Year 1 with 2015, replace Year 2 with 2014,
and replace Year 3 with 2013.
In the References box, include an APA reference for all information retrieved, whether from the Tootsie Roll we
itself, specific forms (i.e. 10k) from the Tootsie Roll website, or other outside sources.
Instructions for citing a 10k or Annual Report: http://rasmussen.libanswers.com/faq/32821 For general APA he
visit the APA Guide: http://guides.rasmussen.edu/apa
Tootsie Roll Industries Inc.
Balance Sheet
Cash and Cash Equivalents
Investments
Accounts Receivable Trade
Inventory (Add: FG and WIP + RM & supplies lines)
Total Current Assets
Net Property, Plant and Equipment
Goodwill
Trademarks
Total Assets
Accounts Payable
Accrued Liabilities
Total Current Liabilities
Total Noncurrent Liabilities
Total liabilities (Add total current liab + total noncurrent)
Common Stock
Class B Common Stock
Retained Earnings
Treasury Stock
Total Equity
Total liabilities and Shareholders Equity
2015
126,145
42,155
51,010
62,263
293,806
184,586
73,237
175,024
908,983
11,322
50,117
72,062
138,373
210,435
25,960
16,348
52,349
-1,992
698,548
908,983
Question 1: Refer to Note 1 in the Notes to the Consolidated Financial Statements. What method of depreciation does To
Industries Inc. use for their property, plant and equipment?
The company uses a straight line of depreciation in valuation of property, plant and equipment
Question 2: : Refer to Note 1 in the Notes to the Consolidated Financial Statements. What method does Tootsie Roll Indu
to value its inventory?
to value its inventory?
It uses LIFO methods in valuation of inventory
Question 3: Calculate Tootsie Roll Industry Inc's fixed asset turnover and interpret it's meaning. Show your work. (Hint: Fi
Turnover is calculated as Net Earnings/ Net Property, Plant and Equipment)
2015= net earnings/ fixed assets
= 66127/499535
= 0.1324
Question 4: Calculate Tootsie Roll Industry Inc's accounts receivable turnover for the most recent year
your work. (Hint: Accounts Receivable Turnover is calculated as Total Sales/Average Accounts Receivable.)
2015= Total sales/account recevable
=536692/51010
=10.52
Question 5: Calculate Tootsie Roll Industry Inc's inventory turnover ratio for the most recent year and interpret its meanin
work. (Hint: Inventory turnover ratio is calculated as Product Cost of Goods Sold/Average Inventory.)
Inventory turn over= cog/inventory
=340090/62236
= 5.4654
Question 6: Has the total current assets amount show an increasing or decreasing trend from one year to the next? What
accounts experienced the largest change? (Hint: To find the amount of change, subtract the prior year amount from the c
amount. Positive answers mean the account has increased by that amount, negative answers mean the account has decre
amount.)
Total current assets have shown an increase
Cash and cash equivalents have experience the largest change among the current assets
Question 7: Is the amount of current liabilities more or less than the long-term liabilities for the most recent year? What d
mean?
Current liabilities are less than long term liabilities
It means that the companies oporatioon relies most in long term liabilities that short term liabilities
Question 8: Is the total stockholders' equity more or less than total liabilities for the most recent year? What does the res
Total equity are more than total liabilities.
This means that the companies oporations relies on on its equity mostly and not borrowings
This means that the companies oporations relies on on its equity mostly and not borrowings
Question 9: Calculate the debt ratio and current ratio for your company for the most recent year. Generally speaking,
ratios tell you? (Hint: Debt ratio is calculated as Total Liabilities/Total Assets; Current ratio is calculated as Total Curr
Current Liabilities.)
Debt ratio= Total Liabilities/Total Assets
Current ratio=Total Current Assets/Total Current Liabilities
=210,437/908,983
= 293,806/72,064
=0.231
= 4.077
Question 10: What is the main reason for the change in stockholders' equity? What is the largest component of stockhold
Change results in sales of stock and retained earnings
The largest component is contributed capital
Question 11: How many classes of common stock does the company have? For each class, how many shares are authorize
and outstanding? (To find outstanding shares, subtract any treasury stock for that class from the number issued to find th
outstanding.)
2 classes of common stock..
Class A, 120,000 shares authorized and 37382 shares issued in 2015.
Class , 40,000 shares authorized and 23542 shares issued in 2015.
Question 12: Calculate the Return on Stockholder's Equity for the most recent year and interpret its meaning. Show your
Return on Stockholders Equity is calculated as Net Earnings/Average Total Equity.)
2015= 66127/698548
= 0.0947
It shows how much profit a company generates from the money invested by shareholders
References:
https://www.last10k.com/sfile:///H:/Annual%20Report%202015%20(pdf).pdfec-filings/tr/0001104659
016402.htm#ITEM8FinancialStatementsandSupplementary
n the text boxes below.
ar 2, etc. Example: If
eplace Year 2 with 2014,
trieved, whether from the Tootsie Roll website
outside sources.
swers.com/faq/32821 For general APA help,
2014
100,108
39,450
43,253
70,379
264,621
190,081
73,237
175,024
910,386
11,641
46,482
64,459
154,791
219,250
25,892
15,894
64,927
-1,992
691,136
910,386
2013
88,283
33,572
40,721
61,856
240,111
196,916
73,237
175,024
888,409
9,153
45,580
60,121
147,983
208,104
25,702
15,455
73,109
-1,992
680,305
888,409
ements. What method of depreciation does Tootsie Roll
plant and equipment
tements. What method does Tootsie Roll Industries Inc. use
terpret it's meaning. Show your work. (Hint: Fixed Asset
ver for the most recent year and interpret its meaning. Show
/Average Accounts Receivable.)
r the most recent year and interpret its meaning. Show your
Sold/Average Inventory.)
trend from one year to the next? What account or
nge, subtract the prior year amount from the current year
negative answers mean the account has decreased by that
urrent assets
erm liabilities for the most recent year? What does the result
hat short term liabilities
s for the most recent year? What does the result mean?
d not borrowings
d not borrowings
the most recent year. Generally speaking, what do these
; Current ratio is calculated as Total Current Assets/Total
ssets/Total Current Liabilities
What is the largest component of stockholders' equity?
For each class, how many shares are authorized, issued,
or that class from the number issued to find the number
ent year and interpret its meaning. Show your work. (Hint:
by shareholders
filings/tr/0001104659-13-
Required: Complete the purple areas of the chart, and the questions in the text boxes below.
List the years in order of most recent as year 1, next most recent as year 2, etc. Example: If
the most recent fiscal year was 2015, then replace Year 1 with 2015, replace Year 2 with 2014,
and replace Year 3 with 2013.
In the References box, include an APA reference for all information retrieved, whether from the Tootsie Roll we
itself, specific forms (i.e. 10k) from the Tootsie Roll website, or other outside sources.
Instructions for citing a 10k or Annual Report: http://rasmussen.libanswers.com/faq/32821 For general APA he
visit the APA Guide: http://guides.rasmussen.edu/apa
Tootsie Roll Industries Inc.
Statement of Cash Flows
Net Earnings
Net Cash Provided by Operating Activities
Net Cash Used in Investing Activities
Net Cash Used in Financing Activities
Increase in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
2015
2014
66127
91073
-8523
-53912
26037
100108
126145
62860
88769
-30459
-44664
11823
88283
100108
Question 1: Which method of reporting cash flows from operations does the company use?
Indirect method
Question 2: Compare net earnings to the net cash provided by operating activities. Explain why these two figures are differ
these two numbers trending in the same direction? What is the largest adjustment item in the operating section for the m
recent year?
The difference is due to the adjustments needed to convert the total net earnings to the cash amount from operating activ
Depreciation is tha largest adjustment
Question 3: What items in the investing section have created the largest cash inflow? Largest cash outflow? Did investing a
provide cash or use cash in each of the three years presented? How can you tell?
sale and maturity available for sale securities have created the larges cash inflow
Purchase from available for sale securities have created the largest cash outflow
Investing activities brought more use of cash in the company.. this is showsn by the diference between cash inflows and ca
outflows in investing activities
Question 4: Did the financing activities provide cash or use cash in each of the three years presented? What are the stock
repurchase trends of the company? What are the dividend trends of the company?
Financial ativities provided use of cash.
Stock repurchase has been decreasing towards the positive value.
divideds have been increasing towards the negative value
Question 5: Does the cash provided by operations cover the amounts of cash used for both investing and financing activitie
does this result mean for the overall amount of cash in the company from the start of the year to the end of the year? Has
increased or decreased? Should this be a concenr for the company?
Cash provided by oporations covers investing and financing activities
It means the overal amount of cash in the company is increasing
Now, locate the Auditors Report, titled "Report of Independent Registered Public Accounting Firm." Address the
questions related to this report.
Question 1: Who is the letter addressed to?
To the Board of Directors and Shareholders of Tootsie Roll Industries, In
Question 2: What is management responsible for?
The managment is responsible for financial statements, maintaining effective internal control over financial reporting and
assessment of the effectiveness of internal control over financial reporting.
Question 3: What is the auditor responsible for?
The auditor is responsible for examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates made by management, and evaluating the o
financial statement presentation
Question 4: Does the auditor give absolute assurance that the financials are free of material error?
yes
Question 5: What is the level of assurance given by the auditor?
Reasonable
Question 6: What policies and procedures does a company's internal control over financial reporting include?
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and disp
of the assets of the company.
(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statement
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being m
only in accordance with authorizations of management and directors of the company.
(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition
company’s assets that could have a material effect on the financial statements.
Question 7: What audit firm signed the audit letter?
IL audit firm in Chicago
References:
https://www.last10k.com/sec-filings/tr/0001104659-13-016402.htm#ITEM8FinancialStatementsandSupplementary
file:///C:/Users/INTELI~1/AppData/Local/Temp/62efbc99055192cb96e37d2cbd3f16b6.pdf
from the Tootsie Roll website
2821 For general APA help,
2013
60849
109823
-47963
-37425
24421
63826
88283
these two figures are different. Are
operating section for the most
mount from operating activities.
ash outflow? Did investing activities
between cash inflows and cash
ented? What are the stock
esting and financing activities? What
to the end of the year? Has it
unting Firm." Address the following
ver financial reporting and for its
d disclosures in the financial
ement, and evaluating the overall
orting include?
the transactions and dispositions
ation of financial statements in
of the company are being made
quisition, use, or disposition of the
ntsandSupplementary
Required: Complete the purple cells for horizontal and vertical analysis for Tootsie Roll Industries using the follo
Vertical Analysis: (Financial Statement item/base amount), where your base amount is Total Revenue for the
Horizontal Analysis: (Current year-base year)/base year
Then, complete the purple cells in the financial ratios below. You will use the analyses on this tab of the workbo
In the References box, include an APA reference for all information retrieved, whether from the Tootsie Roll we
itself, specific forms (i.e. 10k) from the Tootsie Roll website, or other outside sources.
Instructions for citing a 10k or Annual Report: http://rasmussen.libanswers.com/faq/32821 For general APA he
visit the APA Guide: http://guides.rasmussen.edu/apa
Tootsie Roll Industries Inc.
Income Statement
Total Revenue
Product Cost of Goods Sold
Rental and Royalty Cost
Total Gross Margin
Selling, Marketing and Administrative Expenses
Earnings from Operations
Income Taxes
Net Earnings
Balance Sheet
Cash and Cash Equivalents
Investments
Accounts Receivable Trade
Inventory (Add: FG and WIP + RM & supplies lines)
Total Current Assets
Net Property, Plant and Equipment
Goodwill
Trademarks
Total Assets
Accounts Payable
Accrued Liabilities
Total Current Liabilities
Total Noncurrent Liabilities
Total liabilities (Add total current liab + total noncurrent)
Common Stock
Class B Common Stock
Retained Earnings
Year 1
540,112
340,090
889
199,133
108,051
91,082
26,451
66,127
Year 1
126,145
42,155
51,010
62,263
293,806
184,586
73,237
175,024
908,983
11,322
50,117
72,062
138,373
210,435
25,960
16,348
52,349
Treasury Stock
Total Equity
Total liabilities and Shareholders Equity
-1,992
698,548
908,983
Tootsie Roll Industries
Formula
Liquidity Ratios
Current Ratio
Acid Test Ratio
*Total Current
Assets/Total Current
Liabilities
*(Cash & Cash
Equivalents
+Iinvestments +
Accounts Receivable
Trade)/Total Current
Liabilities
Asset Management Ratio
Inventory Turnover
*Product Cost of
Goods Sold/Average
Inventory
(remember, Avg Inv is
beginning year inv +
ending year inv,
result divided by 2.)
Solvency Ratios
Debt ratio
Times Interest Earned Ratio
*Total
Liabilities/Total
Assets
*Operating
Income/Interest
Expense
Profitability Ratios
Gross Profit Percent
*Total Gross
Margin/Total
Revenue
Return on Net Sales
*Net Earnings/Total
Sales
Earnings Per Share (EPS)
**Locate in research
(on company income
statement)
Market Analysis
Price Earning Ratio
**Locate in research
(on Internet)
Dividend Yield
**Locate in research
(on Internet)
*Calculated by Author
**Located in research
References: (Hint! Citing a 10K and/or Annual Report: http://rasmussen.libanswers.com/faq/32821 ; APA
Guide: http://guides.rasmussen.edu/apa )
sis for Tootsie Roll Industries using the following formulas:
e your base amount is Total Revenue for the income statement and Total Assets for the balance sheet.
l use the analyses on this tab of the workbook to create your final project.
etrieved, whether from the Tootsie Roll website
outside sources.
nswers.com/faq/32821 For general APA help,
Year 2
543,525
340,933
947
201,645
117,722
83,923
28,434
62,860
Year 2
100,108
39,450
43,253
70,379
264,621
190,081
73,237
175,024
910,386
11,641
46,482
64,459
154,791
219,250
25,892
15,894
64,927
Year 3
Vertical Analysis
Vertical Analysis
Year 1
Year 2
Vertical Analysis
Vertical Analysis
Year 1
Year 2
543,383
350,960
937
191,486
119,133
72,353
23,634
60,849
Year 3
88,283
33,572
40,721
61,856
240,111
196,916
73,237
175,024
888,409
9,153
45,580
60,121
147,983
208,104
25,702
15,455
73,109
-1,992
691,136
910,386
-1,992
680,305
888,409
TRI
TRI
Competition or
Industry Ratio**
Year 1
Year 2
Year 1
Ratio Benchmarks
Greater than 1.
Ideally greater than 1,
but likely will be less
than 1.
Depends on industry,
higher is better
Less than 67%
Higher the better,
unless interest exp is
0.
Depends on industry,
higher is better
banswers.com/faq/32821 ; APA
Depends on industry,
higher is better
Depends on
company. Would
want to see stay
stable or increase,
not decrease.
Depends on
company. Remaining
steady is good.
Depends on
company. Remaining
steady is good.
lance sheet.
Horizontal Analysis
Year 3 to 1
Horizontal Analysis
Year 3 to 1
Purchase answer to see full
attachment