t0106（t0106）.doc

t0106（t0106） # 0 Money problems In early 1984, Mr. James kirk, chairman of the industrial machinery company, had reviewed the companys past financial reports and the anticipated financial activity plan of 1987. At the end of 1987, the company would have $6 million of notes payable, but the companys project plan indicated that the companys external funding requirements would be reduced after 1985. In 1984, the company needs to raise $6.2 million in external funding, there are two kinds of financing channels to choose from: one is the total amount to several insurance companies issuing $8 million of the underlying bonds, another is the issue the same amount of common stock to the public. Next week, the company will arrange a board meeting to discuss the potential project deficit and the viability of the two funding schemes. Mr Kirk knows that the use of additional bonds is sure to spark debate as the companys current financial leverage ratio is already high. So he decided to first with the federal state bank of industrial machinery, head of the companys accounts Mr Robert McCall, discuss the situation with these two kinds of financing ways (see industrial machinery company from 1979 to 1983 of the companys financial statements, as well as the companys project plan for 1984-1987). # 1 Table 1979 the consolidated income statement of the fiscal year 1983 Unit: in addition to the per share data are dry dollars -- -- -- -- -- -- -- -- -- -- -- -- -- Nineteen eighty-nine, nineteen eighty-nine, 1982, 1982 Net sales revenue of $18131 $2875 $41938 $49064 $64684 Product sales cost 11145 17589 25197 29804 40213 Gross profit of $6986 $11168 $16,741 $19260 $24,471 Sales and management costs 4492 7091 10798, 13686 17764 Depreciation 289 517 723 990 1400 Income before interest income is $2205 $3560 $5,220 $5,220 $5,307 Interest rate 161 357 727 791 1486 Pre-tax profit of $20,493 $3,203 $3,203 $3793 $3821 Taxes 900, 1438, 1965, 1288, 1510 Profit after tax is $1,144 $1,765 $2528 $2,50