On Your Mark is preparing to release its first annual stockholder report since the company’s recent initial public offering (IPO). The accounting department has already prepared and provided the financial statements and ratios (see below) for the most recent year. Now all the division managers are meeting to help create the written analysis portions for the annual report, keeping in mind all the stakeholders who will be reading this information. (shareholders, regulators, investors, security analysts, and credit rating agencies, and so forth) ,Using what you know about On Your Mark from the scenario, the financial documents, and details from your previous tasks, create On Your Mark’s first annual stockholder report for its’ stakeholders. Provide as much detailed analysis as possible to your shareholders for each of the following areas, keeping in mind how the users of this information are likely to use it:,• Discuss the competitive position of the firm. ,• Summarize the financial and accounting control procedures in place to ensure compliance with applicable regulatory agencies. ,Financial Ratios,Phase 2 Task 1: Ratio Anlaysis ,Key Financial Data for Abel Athletics , ,Stock Price (as of 12/21/06) $6.25 ,Free Cash Flow/Share $0.36 ,Dividend/Share (DPS): Dividends/shares outstanding $0.24 ,Book Value/Share: Shareholders Equity/Shares Outstanding $0.18 , ,Strident Marks, Inc. ,Income Statement ,For the year ending December 31, 2006 , ,Revenue ,Net Sales $8,994,000 ,COGS (not including depreciation) $3,759,600 ,Gross Profit $5,234,400 , ,Expenses ,SG&A $1,245,900 ,Depreciation Expense $350,000 ,Total Operating Expenses $1,595,900 , ,Income Before Interest & Taxes $3,638,500 ,Interest Expense $250,000 ,Income Before Taxes $3,388,500 ,Income Tax Expense $1,016,550 ,Net Income $2,371,950 , ,Shares Outstanding 10,000,000 ,Earnings Per Share (EPS) $0.24 , ,Beginning RE $1,500,000 ,Dividends $2,400,000 ,Ending RE $1,471,950 , ,Strident Marks, Inc. ,Balance Sheet ,As of December 31, 2006 , ,ASSETS , ,Cash $1,336,950 ,Accounts Receivable $900,000 ,Inventories $7,500,000 ,Total Current Assets $9,736,950 , ,Property, Plant & Equipment $625,000 ,less Accumulated Depreciation $111,000 ,Net Property, Plant, and Equipment $514,000 , ,Total Assets $10,250,950 , ,LIABILITIES & SHAREHOLDER’S EQUITY , ,Accounts Payable $420,000 ,Accrued Liabilities $484,000 ,Interest Payable $2,500,000 ,Income Taxes Payable $900,000 ,Dividends Payable $2,400,000 ,Total Current Liabilities $6,704,000 , ,Long-term debt $1,750,000 ,Total Liabilities $8,454,000 , ,Common Stock at Par $425,000 ,Retained Earnings $1,471,950 ,Treasury Stock – at cost ($100,000) ,Total Shareholders equity $1,796,950 , ,Total Liabilities and shareholders equity $10,250,950 , ,Key Ratios: , ,* Liquidity Ratios Industry Avg , ,Current Ratio: Curent Assets/Current Liabilities 1.45 1.25 ,Quick Ratio: (Current Assets-Inventory)/Current Liabilities 0.33 0.22 ,Net Working Capital Ratio: Net Working Capital/Total Assets 29.6% 25.2% , ,* Profitability Ratios ,Return on Assets: Earnings/Total Assets 23.1% 21.50% ,Return on Equity: Earnings/Equity 132.0% 125% ,Net Profit Margin: Earnings/Sales 26.4% 25% ,Operating Profit Margin: Operating Profits/Sales 40.5% 35% ,Gross Profit Margin: Sales-COGS/Sales 58.2% 55% , ,* Activity Analysis Ratios , ,Asset Turnover Ratio: Sales/Total Assets 0.88 0.95 ,Fixed Asset Turnover Ratio: Sales/Net Fixed Assets 17.50 15.5 ,Equity Ratio (Proprietary Ratio): Shareholders Equity/Total Assets 0.18 0.15 ,Average Collection Period: AR/(Annual Sales/365) 36.52 40 ,Average Payment Period: AP/((70%*COGS/365)) 58.25 25 ,Accounts Receivable Turnover Ratio: 365/Avg Collection Period 9.99 8.8 ,Inventory Turnover Ratio: COGS/Inventory 0.50 0.4 ,Average Age of Inventory 728.14 675.2 , ,* Capital Structure and Debt Ratios , ,Debt Ratio: Total Liabilities/Total Assets 82.5% 50% ,Debt to Equity Ratio: Long Term Debt/Equity 97.4% 50% ,Interest Coverage Ratio: EBIT/Interest 14.55 25.5 , ,* Capital Market Ratios , ,Price / Earnings Ratio: Stock price/EPS 26.3 28.2 ,Market to Book Ratio: Stock Price/Book Value per Share 34.78 37.5 ,Dividend Yield: DPS/Stock Price 3.84% 2.50% ,Dividend Payout Ratio: DPS/EPS 101.2% 25% , , , , , ,I need this in a word doc and applicable to the numeric data provided about 600 words. If need be I will find and add APA formatting and in-text citations plus reference , , , , , , , , , , , , ,,
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