FINANCE-A brief outline of the firm and its industry is given

Case Analysis

A brief outline of the firm and its industry is given, as
well as a few tips for your attention. You are given three years’ worth of
income statements and balance sheets to examine.

You are a financial analyst working for an
investment firm. This manufacturer has asked for your firm’s help in raising
capital for the upcoming season’s production requirements. It is your job to
analyze the financial statements and comment to the investment brokers on this
firm’s current financial situation. It is late July, and the firm’s financial
statements (representing the fiscal year ending June 30) have just been
released.

For this project you must recreate the attached
financial statements on separate worksheets in an Excel workbook. Then, on
another worksheet, you must create formulas to calculate the financial ratios
that can be derived from the given financial statements. These ratios are to be calculated using formulas in the cells that are
linked to the other worksheets: no credit will be given if the ratios are
calculated by hand and entered into the cells.You must determine which
ratios can be calculated with the information given, based on the ratios given
in your textbook. There is enough data for you to calculate liquidity, asset
management, leverage, and profitability ratios. You must calculate the Du Pont ratio analysis separately. All three
years’ worth of ratios must be calculated, and should be presented in
chronological order for you to do trend analysis.

Next, you must write a one-page paper discussing the
findings of your ratio analysis. You must include not only the current
situation, but also how the ratios have changed over the past three years
(trend analysis). Any recommendations you can make as to what the firm can do
to correct any problem areas would make you look better in the eyes of your
superiors.

Sports, Inc.

Outdoor Sports, Inc. is a manufacturer of surfboards, wind
surfers, and related equipment. The company was started by two surfers
tinkering in their garage with surfboards of their own design. The company has
grown rapidly, cashing in on the increasing popularity of wind surfing.

Outdoor Sports’ business is highly cyclical.
Inventory is built up during the late fall and winter months, and the majority
of sales are booked and delivered to distributors during the early spring.
Competition among the many manufacturers of this easily made product line is
intense. Small manufacturers like Outdoor Sports are under great pressure from
major sports equipment makers, who have substantial promotional resources at
their disposal, as well as complementary products, countercyclical to the sale
of surfing equipment. Brand recognition is an important selling point in this
competitive business, achieved at considerable expense through sport
personality endorsements and other promotional campaigns.

What to expect from Outdoor Sports’ financials
depends on when they are examined during the fiscal year. At June 30, the
company’s fiscal year-end, the financials should look most favorable.
Receivables, inventory, payables, and working capital borrowings should be at
seasonal lows. The firm should be cash rich, as it is about to gear up for the
next season’s production run. Property, plant and equipment should be at some
significant level commensurate with the company’s manufacturing demands,
supported by equity and long-term debt.

Sales margins bear close watching. Pricing pressures
caused by intense competition can erode them to dangerously low levels. Given
the seasonality of the business, there may be a cash flow crunch during the
winter months. Overall, cash flow may be a problem if the business is still
growing rapidly, and requires outside financial resources to do so.

The potential of overproducing during the winter
period for a spring sales period that fails to live up to management’s
expectations is also a significant risk.

OUTDOOR SPORTS, INC.

Balance Sheet ($000s)

June 30, 2011

2009

2010

2011

ASSETS

Current
Assets

Cash

182

25

30

Accounts
Receivable

338

391

349

Inventory

283

831

1,207

Prepaid
Expenses

63

33

11

Other
Current Assets

11

8

3

Total
Current Assets

877

1,287

1,601

Propert,
Plant & Equipment

Land,
Buildings & Equipment

842

842

941

Less
Accumulated Depreciation

179

226

286

Net land,
Buildings & Equipment

663

616

655

Total
Assets

$
1,540

$
1,903

$
2,255

LIABILITIES

Accounts
Payable, Trade

129

283

347

Accounts
Payable, Other

80

52

61

Accrued
Expenses

0

0

0

Short-Term
Debt

184

413

745

Income Tax
Payable

61

0

0

Total
Current Liabilities

454

748

1,152

Long-Term
Debt

578

682

869

Total
Liabilities

1,031

1,430

2,021

Stockholders’
Equity

Capital
Stock

275

275

275

Retained
Earnings

234

198

(41)

Total
Stockholders’ Equity

509

473

234

Total
Liabilities and Equity

$
1,540

$
1,903

$
2,255

Outdoor Sports, Inc.

Income
Statement ($000s)

June 30, 2011

2009

2010

2011

Sales

2,519

4,914

6,185

Cost of
Goods Sold

1,460

2,899

4,172

Gross
Income

1,059

2,016

2,013

Operating
Expenses

732

1,898

2,060

Depreciation
Expense

30

47

61

Operating
Income (EBIT)

297

72

(107)

Interest
Expense

72

107

132

Income Tax
Expense

90

0

0

Other
Expense

47

0

0

Net Income

$
89

$
(36)

$
(239)

Case Analysis

A brief outline of the firm and its industry is given, as
well as a few tips for your attention. You are given three years’ worth of
income statements and balance sheets to examine.

You are a financial analyst working for an
investment firm. This manufacturer has asked for your firm’s help in raising
capital for the upcoming season’s production requirements. It is your job to
analyze the financial statements and comment to the investment brokers on this
firm’s current financial situation. It is late July, and the firm’s financial
statements (representing the fiscal year ending June 30) have just been
released.

For this project you must recreate the attached
financial statements on separate worksheets in an Excel workbook. Then, on
another worksheet, you must create formulas to calculate the financial ratios
that can be derived from the given financial statements. These ratios are to be calculated using formulas in the cells that are
linked to the other worksheets: no credit will be given if the ratios are
calculated by hand and entered into the cells.You must determine which
ratios can be calculated with the information given, based on the ratios given
in your textbook. There is enough data for you to calculate liquidity, asset
management, leverage, and profitability ratios. You must calculate the Du Pont ratio analysis separately. All three
years’ worth of ratios must be calculated, and should be presented in
chronological order for you to do trend analysis.

Next, you must write a one-page paper discussing the
findings of your ratio analysis. You must include not only the current
situation, but also how the ratios have changed over the past three years
(trend analysis). Any recommendations you can make as to what the firm can do
to correct any problem areas would make you look better in the eyes of your
superiors.

Sports, Inc.

Outdoor Sports, Inc. is a manufacturer of surfboards, wind
surfers, and related equipment. The company was started by two surfers
tinkering in their garage with surfboards of their own design. The company has
grown rapidly, cashing in on the increasing popularity of wind surfing.

Outdoor Sports’ business is highly cyclical.
Inventory is built up during the late fall and winter months, and the majority
of sales are booked and delivered to distributors during the early spring.
Competition among the many manufacturers of this easily made product line is
intense. Small manufacturers like Outdoor Sports are under great pressure from
major sports equipment makers, who have substantial promotional resources at
their disposal, as well as complementary products, countercyclical to the sale
of surfing equipment. Brand recognition is an important selling point in this
competitive business, achieved at considerable expense through sport
personality endorsements and other promotional campaigns.

What to expect from Outdoor Sports’ financials
depends on when they are examined during the fiscal year. At June 30, the
company’s fiscal year-end, the financials should look most favorable.
Receivables, inventory, payables, and working capital borrowings should be at
seasonal lows. The firm should be cash rich, as it is about to gear up for the
next season’s production run. Property, plant and equipment should be at some
significant level commensurate with the company’s manufacturing demands,
supported by equity and long-term debt.

Sales margins bear close watching. Pricing pressures
caused by intense competition can erode them to dangerously low levels. Given
the seasonality of the business, there may be a cash flow crunch during the
winter months. Overall, cash flow may be a problem if the business is still
growing rapidly, and requires outside financial resources to do so.

The potential of overproducing during the winter
period for a spring sales period that fails to live up to management’s
expectations is also a significant risk.

OUTDOOR SPORTS, INC.

Balance Sheet ($000s)

June 30, 2011

2009

2010

2011

ASSETS

Current
Assets

Cash

182

25

30

Accounts
Receivable

338

391

349

Inventory

283

831

1,207

Prepaid
Expenses

63

33

11

Other
Current Assets

11

8

3

Total
Current Assets

877

1,287

1,601

Propert,
Plant & Equipment

Land,
Buildings & Equipment

842

842

941

Less
Accumulated Depreciation

179

226

286

Net land,
Buildings & Equipment

663

616

655

Total
Assets

$
1,540

$
1,903

$
2,255

LIABILITIES

Accounts
Payable, Trade

129

283

347

Accounts
Payable, Other

80

52

61

Accrued
Expenses

0

0

0

Short-Term
Debt

184

413

745

Income Tax
Payable

61

0

0

Total
Current Liabilities

454

748

1,152

Long-Term
Debt

578

682

869

Total
Liabilities

1,031

1,430

2,021

Stockholders’
Equity

Capital
Stock

275

275

275

Retained
Earnings

234

198

(41)

Total
Stockholders’ Equity

509

473

234

Total
Liabilities and Equity

$
1,540

$
1,903

$
2,255

Outdoor Sports, Inc.

Income
Statement ($000s)

June 30, 2011

2009

2010

2011

Sales

2,519

4,914

6,185

Cost of
Goods Sold

1,460

2,899

4,172

Gross
Income

1,059

2,016

2,013

Operating
Expenses

732

1,898

2,060

Depreciation
Expense

30

47

61

Operating
Income (EBIT)

297

72

(107)

Interest
Expense

72

107

132

Income Tax
Expense

90

0

0

Other
Expense

47

0

0

Net Income

$
89

$
(36)

$
(239)

Case Analysis

A brief outline of the firm and its industry is given, as
well as a few tips for your attention. You are given three years’ worth of
income statements and balance sheets to examine.

You are a financial analyst working for an
investment firm. This manufacturer has asked for your firm’s help in raising
capital for the upcoming season’s production requirements. It is your job to
analyze the financial statements and comment to the investment brokers on this
firm’s current financial situation. It is late July, and the firm’s financial
statements (representing the fiscal year ending June 30) have just been
released.

For this project you must recreate the attached
financial statements on separate worksheets in an Excel workbook. Then, on
another worksheet, you must create formulas to calculate the financial ratios
that can be derived from the given financial statements. These ratios are to be calculated using formulas in the cells that are
linked to the other worksheets: no credit will be given if the ratios are
calculated by hand and entered into the cells.You must determine which
ratios can be calculated with the information given, based on the ratios given
in your textbook. There is enough data for you to calculate liquidity, asset
management, leverage, and profitability ratios. You must calculate the Du Pont ratio analysis separately. All three
years’ worth of ratios must be calculated, and should be presented in
chronological order for you to do trend analysis.

Next, you must write a one-page paper discussing the
findings of your ratio analysis. You must include not only the current
situation, but also how the ratios have changed over the past three years
(trend analysis). Any recommendations you can make as to what the firm can do
to correct any problem areas would make you look better in the eyes of your
superiors.

Sports, Inc.

Outdoor Sports, Inc. is a manufacturer of surfboards, wind
surfers, and related equipment. The company was started by two surfers
tinkering in their garage with surfboards of their own design. The company has
grown rapidly, cashing in on the increasing popularity of wind surfing.

Outdoor Sports’ business is highly cyclical.
Inventory is built up during the late fall and winter months, and the majority
of sales are booked and delivered to distributors during the early spring.
Competition among the many manufacturers of this easily made product line is
intense. Small manufacturers like Outdoor Sports are under great pressure from
major sports equipment makers, who have substantial promotional resources at
their disposal, as well as complementary products, countercyclical to the sale
of surfing equipment. Brand recognition is an important selling point in this
competitive business, achieved at considerable expense through sport
personality endorsements and other promotional campaigns.

What to expect from Outdoor Sports’ financials
depends on when they are examined during the fiscal year. At June 30, the
company’s fiscal year-end, the financials should look most favorable.
Receivables, inventory, payables, and working capital borrowings should be at
seasonal lows. The firm should be cash rich, as it is about to gear up for the
next season’s production run. Property, plant and equipment should be at some
significant level commensurate with the company’s manufacturing demands,
supported by equity and long-term debt.

Sales margins bear close watching. Pricing pressures
caused by intense competition can erode them to dangerously low levels. Given
the seasonality of the business, there may be a cash flow crunch during the
winter months. Overall, cash flow may be a problem if the business is still
growing rapidly, and requires outside financial resources to do so.

The potential of overproducing during the winter
period for a spring sales period that fails to live up to management’s
expectations is also a significant risk.

OUTDOOR SPORTS, INC.

Balance Sheet ($000s)

June 30, 2011

2009

2010

2011

ASSETS

Current
Assets

Cash

182

25

30

Accounts
Receivable

338

391

349

Inventory

283

831

1,207

Prepaid
Expenses

63

33

11

Other
Current Assets

11

8

3

Total
Current Assets

877

1,287

1,601

Propert,
Plant & Equipment

Land,
Buildings & Equipment

842

842

941

Less
Accumulated Depreciation

179

226

286

Net land,
Buildings & Equipment

663

616

655

Total
Assets

$
1,540

$
1,903

$
2,255

LIABILITIES

Accounts
Payable, Trade

129

283

347

Accounts
Payable, Other

80

52

61

Accrued
Expenses

0

0

0

Short-Term
Debt

184

413

745

Income Tax
Payable

61

0

0

Total
Current Liabilities

454

748

1,152

Long-Term
Debt

578

682

869

Total
Liabilities

1,031

1,430

2,021

Stockholders’
Equity

Capital
Stock

275

275

275

Retained
Earnings

234

198

(41)

Total
Stockholders’ Equity

509

473

234

Total
Liabilities and Equity

$
1,540

$
1,903

$
2,255

Outdoor Sports, Inc.

Income
Statement ($000s)

June 30, 2011

2009

2010

2011

Sales

2,519

4,914

6,185

Cost of
Goods Sold

1,460

2,899

4,172

Gross
Income

1,059

2,016

2,013

Operating
Expenses

732

1,898

2,060

Depreciation
Expense

30

47

61

Operating
Income (EBIT)

297

72

(107)

Interest
Expense

72

107

132

Income Tax
Expense

90

0

0

Other
Expense

47

0

0

Net Income

$
89

$
(36)

$
(239)

Case Analysis

A brief outline of the firm and its industry is given, as
well as a few tips for your attention. You are given three years’ worth of
income statements and balance sheets to examine.



You are a financial analyst working for an
investment firm. This manufacturer has asked for your firm’s help in raising
capital for the upcoming season’s production requirements. It is your job to
analyze the financial statements and comment to the investment brokers on this
firm’s current financial situation. It is late July, and the firm’s financial
statements (representing the fiscal year ending June 30) have just been
released.







For this project you must recreate the attached
financial statements on separate worksheets in an Excel workbook. Then, on
another worksheet, you must create formulas to calculate the financial ratios
that can be derived from the given financial statements. These ratios are to be calculated using formulas in the cells that are
linked to the other worksheets: no credit will be given if the ratios are
calculated by hand and entered into the cells.You must determine which
ratios can be calculated with the information given, based on the ratios given
in your textbook. There is enough data for you to calculate liquidity, asset
management, leverage, and profitability ratios. You must calculate the Du Pont ratio analysis separately. All three
years’ worth of ratios must be calculated, and should be presented in
chronological order for you to do trend analysis.











Next, you must write a one-page paper discussing the
findings of your ratio analysis. You must include not only the current
situation, but also how the ratios have changed over the past three years
(trend analysis). Any recommendations you can make as to what the firm can do
to correct any problem areas would make you look better in the eyes of your
superiors.






Sports, Inc.

Outdoor Sports, Inc. is a manufacturer of surfboards, wind
surfers, and related equipment. The company was started by two surfers
tinkering in their garage with surfboards of their own design. The company has
grown rapidly, cashing in on the increasing popularity of wind surfing.




Outdoor Sports’ business is highly cyclical.
Inventory is built up during the late fall and winter months, and the majority
of sales are booked and delivered to distributors during the early spring.
Competition among the many manufacturers of this easily made product line is
intense. Small manufacturers like Outdoor Sports are under great pressure from
major sports equipment makers, who have substantial promotional resources at
their disposal, as well as complementary products, countercyclical to the sale
of surfing equipment. Brand recognition is an important selling point in this
competitive business, achieved at considerable expense through sport
personality endorsements and other promotional campaigns.










What to expect from Outdoor Sports’ financials
depends on when they are examined during the fiscal year. At June 30, the
company’s fiscal year-end, the financials should look most favorable.
Receivables, inventory, payables, and working capital borrowings should be at
seasonal lows. The firm should be cash rich, as it is about to gear up for the
next season’s production run. Property, plant and equipment should be at some
significant level commensurate with the company’s manufacturing demands,
supported by equity and long-term debt.








Sales margins bear close watching. Pricing pressures
caused by intense competition can erode them to dangerously low levels. Given
the seasonality of the business, there may be a cash flow crunch during the
winter months. Overall, cash flow may be a problem if the business is still
growing rapidly, and requires outside financial resources to do so.





The potential of overproducing during the winter
period for a spring sales period that fails to live up to management’s
expectations is also a significant risk.



OUTDOOR SPORTS, INC.

Balance Sheet ($000s)

June 30, 2011

2009

2010

2011

ASSETS

Current
Assets


Cash

182

25

30

Accounts
Receivable


338

391

349

Inventory

283

831

1,207

Prepaid
Expenses


63

33

11

Other
Current Assets


11

8

3

Total
Current Assets


877

1,287

1,601

Propert,
Plant & Equipment


Land,
Buildings & Equipment


842

842

941

Less
Accumulated Depreciation


179

226

286

Net land,
Buildings & Equipment


663

616

655

Total
Assets


$
1,540


$
1,903


$
2,255


LIABILITIES

Accounts
Payable, Trade


129

283

347

Accounts
Payable, Other


80

52

61

Accrued
Expenses


0

0

0

Short-Term
Debt


184

413

745

Income Tax
Payable


61

0

0

Total
Current Liabilities


454

748

1,152

Long-Term
Debt


578

682

869

Total
Liabilities


1,031

1,430

2,021

Stockholders’
Equity


Capital
Stock


275

275

275

Retained
Earnings


234

198

(41)

Total
Stockholders’ Equity


509

473

234

Total
Liabilities and Equity


$
1,540


$
1,903


$
2,255


Outdoor Sports, Inc.

Income
Statement ($000s)


June 30, 2011

2009

2010

2011

Sales

2,519

4,914

6,185

Cost of
Goods Sold


1,460

2,899

4,172

Gross
Income


1,059

2,016

2,013

Operating
Expenses


732

1,898

2,060

Depreciation
Expense


30

47

61

Operating
Income (EBIT)


297

72

(107)

Interest
Expense


72

107

132

Income Tax
Expense


90

0

0

Other
Expense


47

0

0

Net Income

$
89


$
(36)


$
(239)


Answers

Related Questions

Social Science : Australia News Event...

Running head: AUSTRALIA NEWS EVENT1Australia News EventNameInstitutional affiliationAUSTRALIA NEWS EVENT2Flooding has hit Fiona Stanley Hospital resul...

Sociology : Cultural Heritage....solved...

Cultural HeritageNameCourse TitleInstructorDateFamily Structure My name is Darwin. We are three siblings in my family, that is, I and my twobrothers....

English : Why Do People Prefer To Smoke E Cigarett...

Running Head: WHY PEOPLE PREFER E-CIGARETTEWhy People Prefer E-CigaretteNameInstructorInstitutional AffiliationDate1WHY PEOPLE PREFER E-CIGARETTE2Intr...

Environmental Science : Industrial Hygiene.edited...

Running head: INDUSTRIAL HYGIENE AND TOXICOLOGYIndustrial Hygiene and ToxicologyStudents Name:Institutional Affiliation:1INDUSTRIAL HYGIENE AND TOXICO...

Computer Science : Impacts Of Cloud Computing On O...

Running head: IMPACTS OF CLOUD COMPUTING ON ORGANIZATIONSImpacts of cloud computing on organizationsName of the studentName of the professorCourseDate...

Psychology : Update Assignment...

An unmistakable study is one in which data is gathered without changing the earth. Here andthere these are alluded to as "relationship" or "observatio...

Economics : Externalities...

1Running Head: EXTERNALITIESDifference between Positive and Negative ExternalitiesInstitution AffiliationName2EXTERNALITIESExternalities are the benef...

Management : Netflix Company Memo...

MEMOStudents Name:Course Title:Course Code:Instructors Name:Date of Submission:MEMONetflix Company,Company Address,October 8, 2015.To: CEO, Netflix Co...

Economics : Elasticity...

1Running Head: ELASTICITYDeterminants of Price Elasticity of DemandInstitution AffiliationName2ELASTICITYThe price elasticity of demand is the measure...

Business : Conflict Identification And Resolution...

Running head: CONFLICT1Conflict Identification and ResolutionCONFLICT2When it comes to a team conflict it can include a vast amounts of conflict withi...

Sociology : Residence Assistance Updated...

1Running head: RESIDENCE ASSISTANCEResidence AssistanceNameInstitutional affiliationRESIDENCE ASSISTANCE2I work as a Resident Assistant in a nursing h...

Chemistry : Assignment...

(3.11)Specif ic gravity of the block= block volume below water/ total block volume x s.g . water= 1.5 / (1.5+.5) x 1 = 0.75 kg/dm^3Specif ic gravity o...

Science : Lab 1 Introduction To Science...

Lab 1 Introduction to ScienceExercise 1: The Scientific MethodDissolved oxygen is oxygen that is trapped in a fluid, such as water. Since many livingo...

Accounting : Budget Planning And Control...

Running Head: BUDGET PLANNING AND CONTROLBudget Planning and ControlInstitution AffiliationDate:1BUDGET PLANNING AND CONTROL2After gaining the necessa...

Management : Institution Portfolio 2...

Running Head: INSTITUTION PORTFOLIOSInstitution PortfoliosInstitution AffiliationDate:1INSTITUTION PORTFOLIOS2In essence, the major objective of every...

Management : Institutional Portfolio...

Running Head: INSTITUTIONAL PORTFOLIOInstitutional PortfolioName:Institutional Affiliation:1INSTITUTIONAL PORTFOLIO2Institutional portfolio is a compi...

Business : Organizational Culture Analysis...

Running Head: ORGANIZATION CULTURE ANALYSISOrganization Culture AnalysisName of StudentInstitution affiliation1ORGANIZATION CULTURE ANALYSIS2Organizat...

Business : Performance Issues And Motivation Edite...

Running head:HR PERFORMANCE ISSUES AND MOTIVATIONHR Performance Issues and MotivationThe relationship between motivation, job satisfaction, and work p...

Business : Course Project For Business Class Power...

APPLE INC.NameInstitutionEXECUTIVE SUMMARYAppleInc. is a telecommunications industrythats deals with phones and computersFoundedby the late Steve Jobs...

Management : Questions...

Running head: QUESTIONS1QuestionsNameInstitutional AffiliationQUESTIONS2Questions1. Entrepreneurship and entrepreneurial opportunities. Why they are i...

English : Song...

Running Head: SONGS OF SOLOMON1Songs of SolomonInstitution AffiliatedDateSONGS OF SOLOMON2The books is developed by several plots including;1. Women w...

Marketing : Marketing Plan.edited...

PART 1 TacticsMARKETING PLANThis plan is for an international greengrocer chain stores. This plan targets almost everyhousehold and businesses that re...

Management : Development And Implementation Of Hr...

Running Head: DEVELOPMENT AND IMPLEMENTATION OF HR POLICYDevelopment and Implementation Of HR PolicyStudents NameProfessors NameCourse TitleDate1DEVEL...

History : Haitian Revolution...

Haitian RevolutionNameInstructorCourseHaitian RevolutionMarch 1st, 2017Haitian RevolutionThe Haitian revolution of 179-1808 is one central event in wo...

If you didn't find the right answer

Ask Your Questions, We'll notify you once someone answers it