Cumberland Industries’s 2010 sales were $455,000,000; operating costs (excluding depreciation) were equal to 85% of sales; net fixed assets

Question details:

A. Cumberland Industries’s 2010 sales were $455,000,000; operating costs (excluding depreciation) were equal to 85% of sales; net fixed assets were $67,000,000; depreciation amounted to 10% of net fixed assets; interest expenses were $8,550,000; the state-plus-federal corporate tax  rate was 40%; and Cumberland paid 25% of its net income out in dividends. Given this information, construct Cumberland’s 2010 income statement. Also calculate total dividends and the addition to retained earnngs. (Hint: Start with the partial model in the file and report all dollar figures in thousands to reduce clutter.)

B. Cumberland Industries’s partial balance sheets are shown here on excel. Cumberland issued $10,000,000 of new common stock in 2010. Using this information and the results from part A, Fill in the missing values for common stock, retained earnings, total common equilty, and total liabilities and equity.

C. Construct the statement of cash flows from 2010.

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Answer

Cumberland Industries’s 2010 sales were $455,000,000; operating costs (excluding depreciation) were equal to 85% of sales; net fixed assets

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_Industries_Solutions_(All_Questions_Answered).xls (36K)

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