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YOU MAY USE YOUR HOMEWORK, TEXTBOOK, AND NOTES BUT NO


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THIS IS TO BE DONE ON YOUR OWN THE PENALTY FOR ACADEMIC


DISHONESTY IN THIS COURSE IS AN "F" GRADE FOR THE COURSE AND
POSSIBLE EXPULSION FROM THE UNIVERSITY

There are 7 tabbed pages in this exam spreadsheet including this one.

SAVE THIS FILE BACK TO YOUR COMPUTER WITH YOUR NAME IN THE FILENAME.
RESAVE IT OFTEN WHILE YOU ARE COMPLETING IT.

When you have completed this exam spreadsheet:


Save it one last time to your computer.
Submit it via the Canvas dropbox by March 11th by 11:59 pm.

There are 80 points available from the take home portion of this exam.
Points are shown on each tab. Partial credit will be given where possible.
We will have the in class portion of the Mid-term exam on May 8th at 9:30 in our classroom
which is worth 20 points.
This Mid-Term Exam is worth a total of 100 points.

Please let me know if you have any questions regarding your exam.
Inputs for 2018
Tax Rate 35.0%
Note that the inputs
Common Shares Outstanding 350,000
are in dollars but the
Sales $ 6,850,000 statements below are
Selling and G&A Expenses $ 1,025,000 in thousands of
Depreciation $ 845,000 dollars.
Interest Expense $ 120,000
Fixed Expenses $ 1,250,000
Accounts Receivable $ 2,550,000
Inventory $ 1,420,000
Accounts Payable $ 1,045,000
Instructions
Dividends Per Share $ 0.25
Additional Plant/Equipment $ 135,000
Note: 2018 Cost of Goods as a percentage of sales is the
same as it was in 2017.

Income Statements
2017-2018
(Thousands of Dollars)
2018 2017 2018
Sales $ 6,000.00
Cost of Goods 2,875.00
Gross Profit
Selling and G&A Expenses 890.00
Fixed Expenses 1,200.00
Depreciation 825.00
EBIT
Interest Expense 125.00
Earnings Before Taxes
Taxes 29.75
Net Income

Earnings Per Share

Balance Sheets
2015-2016
(Thousands of Dollars)

2018 2017 2018


Cash $ 3,230.00
Marketable Secutities 750.00 675.00
Accounts Receivable 2,190.00
Inventory 1,560.00
Prepaid Expenses 52.00 45.00
Total Current Assets
Plant and Equipment 9,250.00
Accumlated Depreciation 3,590.00
Net Fixed Assets
Long-Term Investments 860.00 825.00
Total Assets

Accounts Payable $ 965.00


Notes Payable 70.00 85.00
Accrued Expenses 150.00 125.00
Other Current Liabilities 450.00 320.00
Total Current Liabilities
Long-Term Debt 3,500.00 3,850.00
Total Liabilities
Common Stock 4,525.00 4,525.00
Additional Paid-In Capital 1,450.00 1,450.00
Retained Earnings 2,865.00
Total Shareholders Equity
Total Liabilities and Owners Equity

Statement of Cash Flows


(Thousands of Dollars)

2018
Cash Flows from Operations
Net Income
Create formulas only
Depreciation Expense
Change in Marketable Securities
in the Orange cells.
Change in Accounts Receivable
The resulting values
need to have the
Change in Inventories
Change in Prepaid Expenses
proper sign for any
Change in Accounts Payable
input values.
Change in Other Current Liabilities
Total Cash Flows from Operations - = USE
Cash Flows From Investing
Change in Plant and Equipment
+ = SOURCE
Change in Long-Term Investments
+ = SOURCE

Total Cash Flows from Investing

Cash Flows from Financing


Change in Notes Payable
Change in Long-Term Debt
Change in Common Stock
Change in Paid-In Capital
Cash Dividends Paid to Shareholders
Total Cash Flows from Financing

Net Change in the Cash Balance


1.
t the inputs
lars but the
ts below are
usands of
llars.
2.

3.
structions

2017

2017
formulas only
Orange cells.
sulting values
d to have the
r sign for any
ut values.

- = USE

SOURCE
SOURCE
Complete the 2015 and 2016 Income Statements and Balance Sheets using
the information that is provided. All formulas and computations must
appropriately use the 2016 inputs. All computations should reflect any changes
in the inputs

Create the common size income statements and balance sheets for 2017 and 2018
in Columns F and G.

In the Statement of Cash Flows, create a formula in each of the yellow boxes
that will produce the correct result for any values of the inputs.

Create a formula in Cell D44 (Cash for 2016) that


will adjust in value so as to make the balance sheet
Create a formula in Cell D44 (Cash for 2016) that
will adjust in value so as to make the balance sheet
balance regardless of how the inputs are set.
You are given the data for a company for 12 months. The company uses short-term loans and marketable
desired level at the end of each month. Short-term loans will be paid down or paid off with any excess ba
when the loan balance is zero. Marketable securities will be sold first to supply any needed cash infusions
marketable securities and no short-term loans at the beginning of January.

The company expects to make an outlay for new capital equipment in May, June, July, or August. Create a
month of the outlay. Use this and other input information to complete the Cash Budget. Then complete t
the end of each month in Row 52 and the balance of marketable securities at the end of each month in R
when marketable securities are being used, and it should show zero when marketable securities are not b

Format the range F43:N43 (net cash flow) so that all values less than zero display as red numbers instead

Name the input cells for collections Collect0, Collect1, and Collect 2. Then create and save three scenarios
monthly net cash flow for April - December while changing the collection rates . The GOOD scenario will use
NORMAL scenario will use the base case collection rates given here, and the BAD scenario will use Collect0 = 30%,
scenarios on a separate tabbed page.

INPUTS

Collections on sales in the month of the sale 45%


Collections on sales in the month following the sale 25%
Collections on sales in the second month following the sale 35%

Cash Operating Expenses as a Percentage of Current Month Sales 28%

Jan Feb Mar Apr May


Expected Sales $ 15,000 $ 16,825 $ 17,425 $ 18,520 $ 19,870

Collections on Sales

Cash Operating Expenses


Fixed Expenses $ 3,000 $ 3,000
Lease Payments $ 1,250 $ -
Capital Outlay $ -
Tax Payments $ 850 $ -
Total Cash Outflows

CASH BUDGET
Mar Apr May

Beginning Cash Balance


Net Cash Flow
Unadjusted Ending Cash Balance
Adjustment Needed
Ending Cash Balance 22,500

Short-Term Loans and Marketable Securi


Mar Apr May

Short-Term Loans Outstanding -


Marketable Securities -
erm loans and marketable securities investments to bring the cash balance to the
paid off with any excess balances and marketable securities will be used only
any needed cash infusions before loans are used. The company had no

e, July, or August. Create a drop-down list in Cell L24 for the user to select the
h Budget. Then complete the section that gives the balance of short-term loans at
he end of each month in Row 53. The formulas should show positive balances
ketable securities are not being used.

ay as red numbers instead of black numbers for any values of the inputs.

e and save three scenarios using the Scenario Manager that show the company's
The GOOD scenario will use Collect0 = 50%, Collect1 = 30%, and Collect2 = 20%, the
ario will use Collect0 = 30%, Collect1 = 10%, and Collect2 = 60% . Save a summary of the

INPUTS

Capital Outlay for New Equipment $ 85,000

Month of the Capital Outlay

Desired End-Of-Month cash balance $ 30,000

Jun Jul Aug Sep Oct Nov Dec


$ 21,590 $ 15,650 $ 18,750 $ 19,890 $ 22,460 $ 25,650 $ 29,680

$ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000 $ 3,000


$ - $ 1,250 $ - $ - $ 1,250 $ - $ -
$ - $ - $ - $ -
$ - $ 980 $ - $ - $ 1,025 $ - $ -

SH BUDGET
Jun Jul Aug Sep Oct Nov Dec
and Marketable Securities
Jun Jul Aug Sep Oct Nov Dec
Problem 3
Format the area below to look as much
like the picture to the right as possible.
Do not include the arrows.

Elvis Products International


Income Statement
For the Year Ended Dec. 31, 2017
FY2017 FY2016
Sales 3850000 3432000
Cost of Good 3250000 2864000
Gross Profit 600000 568000
Selling and 330300 240000
Fixed Expen 100000 100000
Depreciatio 20000 18900
EBIT 149700 209100
Interest Exp 76000 62500
Earnings Bef 73700 146600
Taxes 29480 58640
Net Income 44220 87960

Net Profit M 0.15584 0.1655


INSTRUCTIONS:
Use the space beginning in Row 29 to create an amoritzation table model that will work for ANY ALLOWABLE values of the
changeable inputs are in red. Create restrictions on the input cells that prevent users from entering values that are not allo

The amount of the loan must be a positive number.


The balloon payment (final payment) must be a positive number or zero and must be less than the amount of the loan.
The term of the loan can be 1, 2, 3, 4, or 5 years.
The interest rate can be between 2% and 10%.
The payment frequency can be annual, quarterly, or monthly. Use a drop-down list in Cell F25 with "Annual", "Quarterly" a
"Monthly" as the choices. Use the results from that cell to set the payment frequency for computation in the table.

Each row in your table should show the monthly payment, the interest portion of that payment, the principal portion of th
and the balance immediately following that payment for all payments within the term of the loan. Rows in the table that a
the term of the loan should show nothing (be blank) except for the payment number. All values in the table should be pos
or zero.

In cell H22, create a formula that computes the total dollar amount of interest that will be paid over the life of the loan. gi
inputs.

In cell H25, create a formula that computes the effective annual interest rate for the loan given the inputs.

INPUTS:
Amount of Loan: $ 575,000.00 Total Interest Paid
Term of loan in years over life of loan
Annual Interest Rate on Loan: 7.50%
Balloon Payment $ 25,000.00 Effective Annual
Payment Frequency Interest Rate

Payment Payment Interest Principal Balance


Number
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
work for ANY ALLOWABLE values of the inputs. User-
rs from entering values that are not allowed.

be less than the amount of the loan.

in Cell F25 with "Annual", "Quarterly" and


ncy for computation in the table.

hat payment, the principal portion of that payment,


rm of the loan. Rows in the table that are beyond
er. All values in the table should be positive numbers

will be paid over the life of the loan. given the

e loan given the inputs.


1

3
5
You are planning for your retirement. Your goal is to accumulate enough money in
your retirement account to pay out $110,000 per year for 30 years starting on January 1, 2058.
The account will have a zero balance after the 30 withdrawals. There will be one payout per year.
You plan to make annual deposits into your retirement account on January 1 of every year from 2019
to 2053 (35 deposits). The first deposit will be $50,000. The remaining 34 deposits will all be equal to each other,
but the amount is not yet known. That is the amount you must compute.

The average annual interest rate you expect to earn on the account is given in the green input cell below.
In the space provided, create whatever formulas are needed to compute the dollar amount of the unknown
annual deposits that will be needed to meet your goal.

Ignore taxes. Label your computation steps to enable partial credit. Your formulas should work
for any positive value of the input interest rate.

Average annual interest rate earned on the account: 5.00%

Computations

Amount needed on 1/1/2057

Value of above on 1/1/2053

Amount of each of the 34 regular payments


ar from 2019
ll be equal to each other,

input cell below.


unt of the unknown

Cash Account
t Date Action Flow Balance

0 1/1/2019 Deposit 1 $ 50,000.00 $ 50,000.00


1 1/1/2020 Deposit 2
2 1/1/2021
3 1/1/2022
4 1/1/2023
5 1/1/2024
6 1/1/2025
7 1/1/2026
8 1/1/2027
9 1/1/2028
10 1/1/2029
11 1/1/2030
12 1/1/2031
13 1/1/2032
14 1/1/2033
15 1/1/2034
16 1/1/2035
17 1/1/2036
18 1/1/2037
19 1/1/2038
20 1/1/2039
21 1/1/2040
22 1/1/2041
23 1/1/2042
24 1/1/2043
25 1/1/2044
26 1/1/2045
27 1/1/2046
28 1/1/2047
29 1/1/2048
30 1/1/2049
31 1/1/2050
32 1/1/2051
33 1/1/2052
34 1/1/2053
35 1/1/2054 Do Nothing $ -
36 1/1/2055
37 1/1/2056
38 1/1/2057
39 1/1/2058 Withdrawl 1 $ (110,000.00)
40 1/1/2059
41 1/1/2060
42 1/1/2061
43 1/1/2062
44 1/1/2063
45 1/1/2064
46 1/1/2065
47 1/1/2066
48 1/1/2067
49 1/1/2068
50 1/1/2069
51 1/1/2070
52 1/1/2071
53 1/1/2072
54 1/1/2073
55 1/1/2074
56 1/1/2075
57 1/1/2076
58 1/1/2077
59 1/1/2078
60 1/1/2079
61 1/1/2080
62 1/1/2081
63 1/1/2082
64 1/1/2083
65 1/1/2084
66 1/1/2085
67 1/1/2086
68 1/1/2087
The inputs below are for a monthly payment amortizing loan with a maximum term of 30 years:

INPUTS:
Enter the number of the payment for w
Amount of Loan: $ 650,000 want to compute the required outputs. F
Term of Loan in Years (1 to 10) 15 the 28th monthly payment would be ent
Annual Interest Rate on Loan: 4.25% You can enter any number between 1 an
output must work for any allowable
Payment Number

In the space below, create whatever forumlas are necessary to compute the outputs shown below
for any individual payment within the life of this loan. You can use any calculations that will work, but
you cannot create or use an amortization table. Your solution must work for any rational values of the inputs.
Label your work so your solution process can be followed for possible partial credit.

Required Outputs

For the designated individual montly payment, compute these output values:

The dollar amount of the monthly payment:


The dollar amount of interest charged to this payment:
The dollar amount of the principal portion of this payment:
The balance of the loan immdiately following this payment:

Computations
umber of the payment for which you
ute the required outputs. For example,
thly payment would be entered as 28.
any number between 1 and 360. Your
ust work for any allowable inputs.

ues of the inputs.