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What would Mydeco's EPS have been each year in this case? Calculate the new EPS for 2016-2019 below:

What would Mydeco's EPS have been each year in this case? Calculate the new EPS for 2016-2019 below:

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 55CE
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See Table 2.5 LOADING... showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco's costs and expenses had been the same fraction of revenues in 2016-2019 as they were in 2015. What would Mydeco's EPS have been each year in this case? Calculate the new EPS for 2016-2019 below:  (Round dollar amounts and number of shares to one decimal place. Round percentage amount and the EPS to two decimal places.)
See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco's costs and expenses had been the same fraction of revenues in 2016-2019 as they were in 2015. What would Mydeco's EPS have been each year in this case? Calculate the new EPS for 2016-2019 below: (Round dollar amounts and number of shares to one decimal place. Round percentage amount and the EPS to two decimal places.) Year 2016 2017 2018 2019 Revenue (millions) 2$ 2$ 2$ % Net Profit Margin at New Net Income (millions) 2$ $ $ 24 ve ivit Shares Outstanding (millions) 2$ 2$ New EPS
Transcribed Image Text:See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco's costs and expenses had been the same fraction of revenues in 2016-2019 as they were in 2015. What would Mydeco's EPS have been each year in this case? Calculate the new EPS for 2016-2019 below: (Round dollar amounts and number of shares to one decimal place. Round percentage amount and the EPS to two decimal places.) Year 2016 2017 2018 2019 Revenue (millions) 2$ 2$ 2$ % Net Profit Margin at New Net Income (millions) 2$ $ $ 24 ve ivit Shares Outstanding (millions) 2$ 2$ New EPS
Data table nount and 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) Income Statement 2015 2016 2017 2018 2019 Revenue 403.5 365.8 424.3 511.9 602.3 Cost of Goods Sold (183.8) (174.4) (201.3) (244.5) (296.0) Gross Profit 219.7 191.4 223.0 267.4 306.3 Sales and Marketing (65.8) (60.9) (27.4) (65.2) (58.6) (28.5) (84.0) (61.3) (34.5) (103.9) (65.0) (36.6) (117.1) (77.1) (37.0) 75.1 Administration Depreciation & Amortization EBIT 65.6 39.1 43.2 61.9 Interest Income (Expense) (33.2) (34.5) (31.0) (35.7) (39.8) Pretax Income 32.4 4.6 12.2 26.2 35.3 Income Tax (11.3) (1.6) (4.3) (9.2) (12.4) Net Income 21.1 3.0 7.9 17.0 22.9 Shares Outstanding (millions) Earnings per Share Balance Sheet 56.6 56.6 56.6 56.6 56.6 $0.37 2015 $0.05 $0.14 $0.30 $0.40 2016 2017 2018 2019 Assets Cash 49.7 71.9 90.3 81.6 87.1 Accounts Receivable 86.7 69.9 68.4 75.1 86.5 Inventory Total Current Assets 35.2 32.3 27.7 33.7 34.1 171.6 174.1 186.4 190.4 207.7 Net Property, Plant & Equipment Goodwill & Intangibles 247.8 242.1 305.1 342.2 349.1 359.5 359 5 359.5 359.5 359.5 Total Assets 778.9 775.7 851.0 892.1 916.3 Liabilities & Stockholders' Equity Accounts Payable Accrued Compensation 17.1 19.7 22.1 27.7 31.1 6.5 5.5 7.1 8.2 9.1 Total Current Liabilities 23.6 25.2 29.2 35.9 40.2 Long-Term Debt 498.6 498.6 573.7 599.8 599.8 Total Liabilities 522.2 523.8 602.9 635.7 640.0 Stockholders' Equity 256.7 251.9 248.1 256.4 276.3 Total Liabilities & Stockholders' 778.9 775.7 851.0 892.1 916.3 Statement of Cash Flows 2015 2016 2017 2018 2019 Net Income 21.1 3.0 7.9 34.5 17.0 22.9 Depreciation & Amortization Change in Accounts Receivable Change in Inventory Change in Pay. & Accrued Comp. Cash from Operations Capital Expenditures Cash from Investing Activ. 27.4 28.5 36.6 37.0 3.9 16.8 1.5 (6.7) (6.0) (11.4) (0.4) (2.9) 2.9 4.6 2.3 1.6 4.0 6.7 4.3 52.8 52.5 (103.5) (103.5) (5.7) 51.8 52.4 (40.8) (40.8) (6.1) 47.6 (25.1) (25.1) (5.7) (24.9) (24.9) (5.7) (76.7) (76.7) (5.7) Dividends Paid Sale (or Purchase) of Stock Debt Issuance (Pay Down) Cash from Financing Activ. Change in Cash Mydeco Stock Price 75.1 69.4 26.1 (5.7) (5.7) 20.4 (8.7) $9.62 (6.1) 5.5 21.0 22.2 18.4 $7.81 $4.28 $4.71 $9.13
Transcribed Image Text:Data table nount and 2015-2019 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) Income Statement 2015 2016 2017 2018 2019 Revenue 403.5 365.8 424.3 511.9 602.3 Cost of Goods Sold (183.8) (174.4) (201.3) (244.5) (296.0) Gross Profit 219.7 191.4 223.0 267.4 306.3 Sales and Marketing (65.8) (60.9) (27.4) (65.2) (58.6) (28.5) (84.0) (61.3) (34.5) (103.9) (65.0) (36.6) (117.1) (77.1) (37.0) 75.1 Administration Depreciation & Amortization EBIT 65.6 39.1 43.2 61.9 Interest Income (Expense) (33.2) (34.5) (31.0) (35.7) (39.8) Pretax Income 32.4 4.6 12.2 26.2 35.3 Income Tax (11.3) (1.6) (4.3) (9.2) (12.4) Net Income 21.1 3.0 7.9 17.0 22.9 Shares Outstanding (millions) Earnings per Share Balance Sheet 56.6 56.6 56.6 56.6 56.6 $0.37 2015 $0.05 $0.14 $0.30 $0.40 2016 2017 2018 2019 Assets Cash 49.7 71.9 90.3 81.6 87.1 Accounts Receivable 86.7 69.9 68.4 75.1 86.5 Inventory Total Current Assets 35.2 32.3 27.7 33.7 34.1 171.6 174.1 186.4 190.4 207.7 Net Property, Plant & Equipment Goodwill & Intangibles 247.8 242.1 305.1 342.2 349.1 359.5 359 5 359.5 359.5 359.5 Total Assets 778.9 775.7 851.0 892.1 916.3 Liabilities & Stockholders' Equity Accounts Payable Accrued Compensation 17.1 19.7 22.1 27.7 31.1 6.5 5.5 7.1 8.2 9.1 Total Current Liabilities 23.6 25.2 29.2 35.9 40.2 Long-Term Debt 498.6 498.6 573.7 599.8 599.8 Total Liabilities 522.2 523.8 602.9 635.7 640.0 Stockholders' Equity 256.7 251.9 248.1 256.4 276.3 Total Liabilities & Stockholders' 778.9 775.7 851.0 892.1 916.3 Statement of Cash Flows 2015 2016 2017 2018 2019 Net Income 21.1 3.0 7.9 34.5 17.0 22.9 Depreciation & Amortization Change in Accounts Receivable Change in Inventory Change in Pay. & Accrued Comp. Cash from Operations Capital Expenditures Cash from Investing Activ. 27.4 28.5 36.6 37.0 3.9 16.8 1.5 (6.7) (6.0) (11.4) (0.4) (2.9) 2.9 4.6 2.3 1.6 4.0 6.7 4.3 52.8 52.5 (103.5) (103.5) (5.7) 51.8 52.4 (40.8) (40.8) (6.1) 47.6 (25.1) (25.1) (5.7) (24.9) (24.9) (5.7) (76.7) (76.7) (5.7) Dividends Paid Sale (or Purchase) of Stock Debt Issuance (Pay Down) Cash from Financing Activ. Change in Cash Mydeco Stock Price 75.1 69.4 26.1 (5.7) (5.7) 20.4 (8.7) $9.62 (6.1) 5.5 21.0 22.2 18.4 $7.81 $4.28 $4.71 $9.13
Expert Solution
Step 1

Earnings per shares refers to the profit earned by each shareholder after paying all the expenses of the company. It is computed by dividing the outstanding common shares from the difference of net income and preferred dividend of the company.

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