DuPont Equation
Use the attached data to show and discuss the Extended DuPont Equation for this investment for the farm.( solve the equation and get the number for analysis).
Summarize Financial Health
Use numbers to discuss and show detailed ATCFs (After Tax Cash Flows). Be sure to explain any assumptions concerning prices, costs, depreciation, efficiency, etc. Be sure to inform your information sources.
How much it costs to hire out trucking each year? $4,300 for trucking to Emmett each year
*get charged $0.16/bu to Emmett
*get charged $0.40/bu to Toledo
What we sold crops for in the last 5 years (prices) Figure $9.60/bu. for 15,000 bu. soybeans, $3.45/bu. For 24,000 bu. Corn
Emit Elevator vs the Anderson’s, what is the advantage? $0.46 soybeans; $0.30 corn; $0.39 red winter wheat SEE: http://starofthewest4.mobile.agricharts.com/cash/prices.php?location_filter=10802
https://www.andersonsgrain.com/locations/oh/maumee/
Loan or cash purchase, over how long would we take a loan out for? For project, figure $45,000 Peterbuilt or Kenworth semi-tractor with a Wilson or Dakota hopper trailer on a 3-year loan at 5.5% interest
NPV, IRR, NPC, ATCF,
When using prices and projections from the past. Where are you on the supply curve? Long run economic profit equals 0 in the end. Equilibrium. Etc
FAPRI – projections for corn and soybean prices
Goal seek on excel to figure out break even
It’s the margins that matter more, not just the prices
New investment: $73,500 roughly
Truck = 2007 Peterbilt 379 $37,500
Trailer = 2012 Wilson Hopper Bottom $36,000
Year
2012
Manufacturer
WILSON
Condition
Used
Gross Vehicle Weight
65,000
Suspension
Air Ride
Length
43 ft
Width
102 in
Height
6 ft 6 in
Tires
Michelin 275×80
Wheels
All Aluminum
Number of Rear Axles
Tandem
Liquidity Ratios
Current Ratio= 237,934.01/0
Quick Ratio=($270,550.00-$22,350.00)/$19,750.09=12.57
Corn Prices Ranges 5 Years
2012 ? 5.7950 – 8.3950
2013 ? 4.0500 – 7.4300
2014 ? 2.8050 – 4.8850
2015 ? 3.4700 – 4.3475
2016 ? 3.2500 – 4.4275
Soybean Prices Ranges 5 Years
2012 ? 13.3500 – 17.9000
2013 ? 12.5100 – 15.8200
2014 ? 8.8250 – 15.2600
2015 ? 8.5525 – 10.3025
2016 ? 8.6350 – 11.6275
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BALANCE SHEET INCOME STATEMENT STATEMENT OF CASH FLOW
1/1/17 1/1/16
ASSETS 2048934.01 2000465.00
CURRENT ASSETS Net Sales 275088.44 Cash Flows from Operations
Cash and Marketable Securities 205934.01 245000.00 Cost of Goods Sold 55304.02 NIAT 45134.10
Accounts Receivable 5500.00 3200.00 Operating Expenses 152150.32 Depreciation Expense ‘+’ 10500.00
Inventory 24500.00 22350.00 Depreciation 10500.00 Change in Acct Receivable ‘-‘ 2300.00
Total Current Assets 235934.01 270550.00 realized cap gains 0.00 Change in Inventory ‘-‘ 2150.00
EARNINGS BEFORE INTEREST AND TAXES (EBIT) 57134.10 Change in Current Operating Liabilities
FIXED/LONG TERM ASSETS Change in Acct Payable ‘+’ (1200.00)
Prop, Plant and Equip 1810000.00 1750000.00 Interest 0.00 Change in accrued liabilities ‘+’ 0.00
Other Assets 1000.00 154085.89
Total Long Term Assets 1811000.00 1904085.89 EARNINGS BEFORE TAXES (EBT) 57134.10 Net Cash Flow from Operations 49984.10
TOTAL ASSETS 2046934.01 2174635.89 Taxes 12000.00 Cash Flow from Investing Activities
LIABILITIES NET INCOME AFTER TAX (NIAT) 45134.10 Net cash flow from investment 82585.89
CURRENT LIABILITIES
Notes Payable 0.00 0.00 Dividends (withdrawals) 0.00 Cash Flow from Financing Activities
Current Portion of LTD 0.00 18550.09 Change in LTD ‘+’ (153085.89)
Accounts Payable 0.00 1200.00 ADDITIONS TO RETAINED EARNINGS 45134.10 Change in Current Portion of LTD ‘+’ (18550.09)
Accrued Liabilities 0.00 0.00 Change in Notes Payable ‘+’ 0.00
Total Current Liabilities 0.00 19750.09 Dividends(withdrawals) ‘-‘ 0.00
Total Long Term Debt 0.00 153085.89 Net cash flow from financing (171635.98)
Other Capital 0.00 0.00
Retained Earnings 2046934.01 2001799.91 CHANGE IN CASH POSITION (39065.99)
adjustment
TOTAL EQUITY 2046934.01 2001799.91
TOTAL DEBT AND EQUITY 2046934.01 2174635.89
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RATIO ANALYSIS FOR HQN Inc
12/31/2016 2016
LIQUIDITY RATIOS EFFICIENCY RATIOS
Current ratio #DIV/0! Inventory Turnover 12.31
ITTO 29.66
Quick ratio 12.57 Asset Turnover 0.13
LEVERAGE RATIOS ATTO 2885.41
Debt/Asset 0.08 Receivable Turnover 85.97
RTTO 4.25
Debt/Equity 0.09 PROFITABILITY
Asset/Equity 1.09 Gross margin gin m 20.77%
Solvency Return on Asset 2.63%
Times Interest Earned #DIV/0! Return on Equity 2.85%
Debt Service Ratio 2.41
