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Financial Analysis of Chemline Corp.

This document appears to be a case analysis for Chemline Scientific Corp. It includes Chemline's statement of financial position and statement of financial performance for 2017 and 2016. The case analysis requires calculating various financial ratios for Chemline in 2017 and comparing them to industry averages, then analyzing whether Chemline is in a good or bad position for each ratio. Recommendations are to be provided for any ratios where Chemline is not meeting industry standards.

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carol indangan
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78 views1 page

Financial Analysis of Chemline Corp.

This document appears to be a case analysis for Chemline Scientific Corp. It includes Chemline's statement of financial position and statement of financial performance for 2017 and 2016. The case analysis requires calculating various financial ratios for Chemline in 2017 and comparing them to industry averages, then analyzing whether Chemline is in a good or bad position for each ratio. Recommendations are to be provided for any ratios where Chemline is not meeting industry standards.

Uploaded by

carol indangan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

CARD-MRI Development Institute, Inc.

Tranca, Bay, Laguna

Name: __________________________________ AE 20 - FINANCIAL MARKETS


Year & Section: ___________________________ Prof. John Benvers A. Malabanan, CPA, MM

CASE ANALYSIS #1

CHEMLINE SCIENTIFIC CORP. CHEMLINE SCIENTIFIC CORP.


STATEMENT OF FINANCIAL POSITION STATEMENT OF FINANCIAL PERFORMANCE
AS OF 31 DECEMBER AS OF 31 DECEMBER
(Amount in Philippine Pesos) (Amount in Philippine Pesos)

2017 2016 2017 2016


ASSETS SALES 108,500,964.00 101,246,446.00
Current Assets COST OF SALES 86,180,767.00 81,500,197.00
Cash and Cash Equivalents 8,389,142.00 1,017,258.00 GROSS INCOME 22,320,197.00 19,746,249.00
Accounts Receivable 13,017,014.00 11,235,601.00 OPERAT ING EXPENSES 16,834,269.00 15,360,480.00
Merchandise Inventory 4,249,265.00 3,739,926.00 EARNINGS BEFORE T AX 5,485,928.00 4,385,769.00
Prepaid expense 539,193.00 737,458.00 PROVISION FOR INCOME T AX 1,645,778.00 1,315,731.00
T otal Current Assets 26,194,614.00 16,730,243.00 NET INCOME 3,840,150.00 3,070,038.00
Non-current assets
Property & equipment, net 2,141,203.00 1,182,275.00

TOTAL ASSETS 28,335,817.00 17,912,518.00

LIABILITIES & STOCKHOLDERS' EQUITY


Current Liability
T rade and other payables 10,061,157.00 3,478,008.00
10,061,157.00 3,478,008.00
Stockholders' Equity
Authorized Share Capital - 160,000 Shares
at P100 par value 7,000,000.00 7,000,000.00
Unappropriated Retained Earnings 6,274,660.00 7,434,510.00
Appropriated for future expansion 5,000,000.00 -
T otal 18,274,660.00 14,434,510.00

TOTAL LIABILITIES &STOCKHOLDERS' EQUITY 28,335,817.00 17,912,518.00

Requirement No. 1:
a. Using the statement of financial position, prepare a vertical common-size analysis for 2017 and 2016. Use total assets as a base.
b. Using the statement of financial position, prepare a horizontal common-size analysis for 2017 and 2016. Use 2016 as the base.
c. Comment on significant trends that appear in (a) and (b).
Requirement No. 2:
a. Using the statement of financial performance, prepare a vertical common-size analysis for 2017 and 2016. Use revenue as a
base.
b. Using the statement of financial performance, prepare a horizontal common-size analysis for 2017 and 2016. Use 2016 as the
base.
c. Comment on significant trends that appear in (a) and (b).
Requirement No. 3:
a. Compute for the following for the year 2017: Industry Average - 2017
1. Current Ratio 5 times
2. Acid Test (Quick Asset) Ratio 3.50 times
3. Cash Ratio 1.50 times
4. Working Capital PhP15,000,000.00
5. Inventory Turnover 26 times
6. Age of Inventory/Days sales in inventory 14.04 days
7. Accounts Receivable Turnover 7 times
8. Age of Receivables/Average collection period 52.14 days
9. Operating Cycle 66.18 days
10. Accounts Payable Turnover 12.17 times
11. Age of Payables/Average payment period 30 days
12. Sales to Working Capital 9 times
13. Sales to Total Assets 5 times
b. Given the Industry Average for the year 2017, analyze each liquidity and activity ratios and indicate if the company is in good or in
bad position. Give recommendations to the company for each ratios, if any.

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