2. The following is the information available for Penn Star Inc. (23%) Penn Star

Question

2. The following is the information available for Penn Star Inc. (23%) Penn Star Inc. Balance Sheet Dec. 31, xxxx * S in thousands Asset Cash Marketable Securities Account Receivable Inventories Total Current Assets Liabilities and Equity s 2,000 4,000 6,000 Account Payable Other Short-Term Liability Total Current Liabilities S 3,500 Long-Term Bond 9,500 Land 8,000 10,000 000) Common Stock Retained Earnings 10,500 6,000 Other Fixed Assets Accumulative Depreciation Net Fixed Assets Total Assets Total Liabilities and Equity90 Penn Star Inc. Income Statement Dec. 31, xxxx *S in thousands Sales Cost of Goods Sold Other Operating Expense Depreciation $98,000 (72,500) (13,000) (500) 2900 EBIT Interest Expenses 0 Taxable Income Tax $,000) Net Income The number of shares oustanding is 5,000,000 ill out all the brackets above in the balance sheet and the income statement (2%) hat are the gross profit and the operating profit according to the income statement listed (3%

Explanation / Answer

Requirement c: Operating Cash Flow: Net Income 6200*1000 6200000 Add: Depreciation 500*1000 500000 Add: Interest Expense 800*1000 800000 7500000 Requirement d: Dividend Per share: Net Income 6200000 Outstanding Shares 500000 Earnings per share 6200000/500000 12.4 Dividend Payout ratio 30% Dividend per share 3.72 Requirement e: Total Liability: Account Payable 3500*1000 3500000 Other Short Term Liability 2500*1000 2500000 Total Current Liabilities 6000000 Long term Bond 9500*1000 9500000 Common Stock 10500*1000 10500000 Retained Earnings 6000*1000 6000000 Total Liabilities & Equity 38000000 Net Working Capital: Total Current Assets: Cash 2000 Marketable Securities 4000 Accounts Receivable 6000 Inventories 4000 16000 16000000 Total Current Liabilities 6000000 Working Capital 160000000-6000000 10000000 Requirement f: Stock Price 35 Earnings per share 12.4 Price Earnings ratio 35/12.4 2.82258065

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