EBK HEALTHCARE FINANCE: AN INTRODUCTION
EBK HEALTHCARE FINANCE: AN INTRODUCTION
6th Edition
ISBN: 9781567937428
Author: Gapenski
Publisher: YUZU
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You are preparing pro forma financial statements for 2017 using the percent-of-sales method. Sales were $100,000 in 2016 and are projected to be $120,000 in 2017. Net income was $5,000 in 2016 and is projected to be $6,000 in 2017. Equity was $45,000 at year-end 2015 and $50,000 at year-end 2016. Assuming that this company never issues new equity, never repurchases equity, and never changes its dividend payout ratio, what would be projected for equity at year-end 2017?
Consider Southeast Home Care, a for-profit business. In 2015, its net income was $1,500,000 and it distributed $500,000 to ownderws in the form of dividends. Its beginning-of-year equity balance was $12,000,000. a) Use this information to construct the business's statement of changes in equity. b) What is the ending 2015 value of the business's equity account?
Calculate the Current Ratio, Debt Ratio, Return on Assets (ROA) and Return on Equity (ROE). For the ROA and ROE, you should use the average total assets and the average total equity in your calculations.  (The average is the total across two years divided by two).  Calculate these values for each of 2011-2014.  Interpret your calculations: what does this information mean?  How is the company doing?
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