Choose a publicly traded company and analyze the financial statements based on the various ratios discussed in concept 5 (leverage, debt to equity, liquidity ratios, etc.). Provide an overview of how financially healthy the company is and predictions for the future of the company.

For the publicly traded U.S. company Apple (AAPL), analyze the overall effect of macroeconomic principles, theories, policies, and tools that have influenced the company's economic decisions and strategy development.

QUESTION 3 (18 Marks: 24 Minutes)
The following is T Allen’s statement of financial position at 31 December 2006 and statement of changes in equity for the year ended 31 December 2006 together with comparative figures for 2005.
T ALLEN
STATEMENT OF FINANCIAL POSITION
AT 31 DECEMBER
2006
R
2005
R
ASSETS
Non-current assets
70 000
30 000
Furniture at cost
100 000
50 000
Accumulated depreciation
(30 000)
(20 000)
Current assets
530 000
470 000
Inventory
330 000
270 000
Accounts receivable
200 000
120 000
Cash at bank
-
80 000
600 000
500 000
EQUITY AND LIABILITIES
Capital and reserves
Capital
200 000
300 000
Current liabilities
400 000
200 000
Accounts payable
300 000
200 000
Bank overdraft
100 000
-
600 000
500 000
T ALLEN
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER
Capital
R
Balance at 1 January 2005 200 000
Profit for the period 200 000
Withdrawals (100 000)
Balance at 31 December 2005 300 000
Profit for the period 100 000
Withdrawals (200 000)
Balance at 31 December 2006 200 000
Page 20 of 21
You are required to:
a) Prepare a statement of cash flows to explain why in spite of the fact that a profit has been earned during the year ended 31 December 2006, the business is in financial difficulties. Use the indirect method.
b) Explain the three main reasons why the business has gone into overdraft at 31 December 2006.

Year/Number of Years Since 1971/Number of stores

• Identify the initial value and the growth rate of your exponential model and explain what they mean in the context of Starbucks Stores. Put your explanations in a text box.

• Use your exponential model to predict the number of Starbucks locations in the following years:

1980, 1990, 2000, 2010, 2020, 2030, 2040, 2050

(a) Use Excel, MegaStat, or MINITAB to fit three trends (linear, quadratic, exponential) to the time series. (A negative value should be indicated by a minus sign. Do not round the intermediate calculations. Round your final answers to 2 decimal places.)

(b) Use each of the three fitted trend equations to make numerical forecasts for the next 3 years. (Round the intermediate calculations to 2 decimal places and round your final answers to 1 decimal place.)

T Linear| Exponential | Quadratic

9 _________ _________ _________

10 _________ _________ _________

11 _________ ___________ _________

In January 2004, Mr. Pandit decided to buy a residential property and rent to various tenants. On 1st January 2004, he borrowed Rs. 30 Lakhs from a housing bank on a condition of repaying the loan in 10 annual installments with an interest @10% per annum. He put in his own savings of Rs. 15 Lakhs and bought a property having 5 flats in a fast developing locality. The cost of the property was Rs. 30 Lakhs comprising land valued at Rs. 15 lakhs and building values at Rs. 15 lakhs.

The entire year of 2004 was spent in repairing and repainting the property. The cost of one-time repairs was Rs. 5 lakhs and that of repainting, which was completed on 31st December 2004, was Rs. 1.2 lakh. Mr. Pandit expected that this paint would last for 3 years before it was repainted. The life of the property after repairs was expected to be 20 years. Mr. Pandit was informed that cost of repairs and first year's interest on the bank loan had to be added to the cost of building as it were incurred in bringing asset to a position of generating revenue.On December 31st of 2004, Mr. Pandit paid the first installment of loan together with interest @10%.

The flats were ready to let out on 1st January 2005. 5 tenants signed the agreement and paid interest free deposit equivalent to 10 months rent. The monthly rent of each flat was Rs. 8000. The three tenants paid their rent regularly on the last day of the month during 2005. One tenant Mr. Khanna, had indicated that he would vacate the flat on 31st december 2005 and had not paid his rent for November and december, requesting Mr. Pandit to adjust the same against his deposit. Though Mr. Khanna vacated the flat on the decided date, Mr. Pandit had yet to pay his balance deposit amount. Another tenant, Mr. Khan went abroad in December 2005 but had promised to pay the rent on return. Mr. Pandit had already found a tenant for the flat vacated by Mr. Khanna and the new tenant paid a deposit of Rs. 80000 on 31st December 2005. Mr. Pandit paid the second installment of loan together with interest on 31st December 2005. Mr. Pandit had made the following payments during 2005:

Taxes - Rs 20000

Electricity - Rs 10000

Telephone - Rs 10000

Fire Insurance was taken on January 1, 2005 for 4 years - premium Rs 60000

The closing cash/bank balance was Rs. 546000 on 31st December 2005.

******

Prepare the income statement and balance sheet of Samavya Building as on 31st December 2005 and show each step in detail.

How to find the cost of debt, cost of preferred stock, cost of common equity, capital structure, and the weighted average cost of capital for a publicly traded company like Costco or Amazon.

What are the acceptable methods of accounting for business operations in a foreign country? Choose a publicly traded company that operates internationally and identify impact that the foreign operations have on the financial statements. Explain.

Please read instructions

Part 4A:(In 200 words) (Using an American publicly traded company as an example) Using the straight-line method for amortizing a discount or premium, provide an example of the entry to issue a bond at par and the entry for the first 6 month interest payment. For each 6 month interest payment, explain why the interest expense amount is different (or the same) from the interest payment amount

Part 4B:(In another 200 words) Using an American publicly traded company as an example describe what the graph would look like for the Straight-line depreciation method. Explain why the graph would visually represent the Straight-line depreciation method.

Bayside, Inc.

2004 and 2005 Balance Sheets

($ in thousands)

                                         2004      2005                                                          2004      2005

        Cash                      $     70   $   180               Accounts payable                   $1,350   $1,170

         Accounts rec.              980        840               Long-term debt                          720       500

       Inventory                   1,560     1,990              Common stock                         3,200     3,500

       Total                        $2,610   $3,010              Retained earnings       940     1,200

        Net fixed assets        3,600     3,360        

        Total assets               $6,210  $6,370              Total liabilities & equity               $6,210   $6,370

Calculate the following: for 2005 only (You will show your work and put it in the drop box).

Additional Information at the end of 2005:

Fair Market Value of the Stock $190 per share

Number of Common Shares Outstanding 100,000

Dividends paid during 2005 - $4 per share

Calculate the Average Days Sales for Collecting Receivables.

Carry your answer two decimal points. 33.0899 would be entered as 33.09

If this companies terms are Net 15 on items it sells and its Average Days Sales for collecting those receivables is 39 days, should the company be concerned?

Explain this Profit Margin Percentage. What does it mean?

Calculate the Earnings Per Share for the company.  (Net Income/Oustanding Shares)

Carry your answer two decimal points. 23.0899 would be entered as 23.09

Calculate the Price to Earnings Ratio.

Carry your answer two decimal points. 23.0899 would be entered as 23.09

If the industry Price to Earnings ratio is at 15, what could account for the difference from the industry average?

Beginning Retained Earnings $100,000

Dividends Paid for the Year $20,000

Net Loss for the Year $30,000

Based on the information above, the Ending Retained Earnings Balance will be?

Enter your answer without dollar signs and no commas. Example $4,000 would be entered as 4000