Description
I have attached two excel documents here. I also have links to some tutorial videos that are helpful in completing the excel documents. They show you exactly what to do in the excel. I need all the formulas inserted properly on the excel (basically show all work and not just plug in the numbers).
Excel 3
Excel 4
Unformatted Attachment Preview
Purchase answer to see full attachment
Explanation & Answer
Attached.
Name
First
Student 1
Last
Students should refer to BH text Chapter 7 if you need help understanding the theory/problem
For Excel extra credit assignment fill in the yellow fields. The numeric cells in the exercise must be calculated fields.
4a. Financial Impact
Calculate the profit margin and return on assets
EARNINGS AND EXPENSES (YEAR ENDING JANUARY 2012)
Sales
Cost of goods sold (COGS)
Pretax earnings
SELECTED BALANCE SHEET ITEMS
Merchandise inventory
Total assets
Part a)
Profit margin
Return on assets (ROA)
$50,000,000
$30,000,000
$5,000,000
$2,500,000
$8,000,000
10%
63%
If COGS and Merchandise Inventory are both reduced by 10% what is new pretax profit and ROA?
EARNINGS AND EXPENSES (YEAR ENDING JANUARY 2012)
Sales
New Cost of goods sold (COGS)
Old Pretax earnings
+ 10% reduction in COGS
New pretax earnings
SELECTED BALANCE SHEET ITEMS
New merchandise inventory
Old total assets
- 10% reduction in merchandise inv.
Net total assets
Part b)
Profit margin
Return on assets (ROA)
$50,000,000
$27,000,000
$5,000,000
$3,000,000
$8,000,000
$2,250,000
$8,000,000
$250,000
$7,750,000
16%
103%
Part C: Based on current profit margin, how much in additional sales would Dulaney have to generate in order to have the same effect
on pretax earnings as a 10% decrease in merchandise costs?...