Toy World Solution

In: Business and Management

Submitted By gpanizza
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– Seasonal Income Statement. 1) We assumed the “Net Sales” as exogenous variables. 2) We computed the COGS as the 70% of Net Sales. 3) The Gross Margins are equal to the difference between Net Sales and COGS 4) The Operational Expenses are given and equal to 200,000$ per month. 5) Interest Expenses are calculated as the sum of interests based on Long Term Debt (400,000$ with an amortization of 25,000$ due in June and December) and interests based on the Line of Credit (752,000$ at the beginning, with a monthly maturity) . The first has a fixed annual rate of 95/8%, while the second has a annual rate of 9%. In the calculation of those we divided by 12 to reach the monthly payment. 6) The total of Interest incomes are based on the Cash available to Toy World, Inc.. They are equal to 4% (annualized rate of return) times the average monthly cash balances. To compute the monthly interest incomes we did the arithmetical mean of two months cash availability. Doing this we addressed the lack of knowledge related to the dates of payments. 7) The NIBT is the difference between the Gross Margin plus…...

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