Luther Corporation: Consolidated Balance Sheet

[waynest]

Use the table for the question(s) below.

Luther Corporation Consolidated Balance Sheet December 31, 2006 and 2005 (in $ millions)

Assets	2006	2005	​	Liabilities and Stockholders' Equity	2006	2005
Current Assets	​	​	​	Current Liabilities	​	​
Cash	63.6	58.5	​	Accounts payable	87.6	73.5
Accounts receivable	55.5	39.6	​	Notes payable / short-term debt	10.5	9.6
Inventories	45.9	42.9	​	Current maturities of long-term debt	39.9	36.9
Other current assets	6.0	3.0	​	Other current liabilities	6.0	12.0
Total current assets	171.0	144.0	​	Total current liabilities	144.0	132.0
​	​	​	​	​	​	​
Long-Term Assets	​	​	​	Long-Term Liabilities	​	​
Land	66.6	62.1	​	Long-term debt	239.7	168.9
Buildings	109.5	91.5	​	Capital lease obligations	---	---
Equipment	119.1	99.6	​	Total Debt	239.7	168.9
Less accumulated   depreciation	(56.1)	(52.5)	​	Deferred taxes	22.8	22.2
Net property, plant, and equipment	239.1	200.7	​	Other long-term liabilities	---	---
Goodwill	60.0	--	​	Total long-term liabilities	262.5	191.1
Other long-term assets	63.0	42.0	​	Total liabilities	406.5	323.1
Total long-term assets	362.1	242.7	​	Stockholders' Equity	126.6	63.6
​	​	​	​	​	​	​
Total Assets	533.1	386.7	​	Total liabilities and Stockholders' Equity	533.1	386.7

Refer to the balance sheet above.  Luther's quick ratio for 2005 is closest to:
◦ 0.77
◦ 1.31
◦ 0.92
◦ 1.09

[SomethingSomething]

0.77

[vinney12]

Use the table for the question(s) below.

Luther Corporation Consolidated Balance Sheet December 31, 2006 and 2005 (in $ millions)

Assets	2006	2005	​	Liabilities and Stockholders' Equity	2006	2005
Current Assets	​	​	​	Current Liabilities	​	​
Cash	63.6	58.5	​	Accounts payable	87.6	73.5
Accounts receivable	55.5	39.6	​	Notes payable / short-term debt	10.5	9.6
Inventories	45.9	42.9	​	Current maturities of long-term debt	39.9	36.9
Other current assets	6.0	3.0	​	Other current liabilities	6.0	12.0
Total current assets	171.0	144.0	​	Total current liabilities	144.0	132.0
​	​	​	​	​	​	​
Long-Term Assets	​	​	​	Long-Term Liabilities	​	​
Land	66.6	62.1	​	Long-term debt	239.7	168.9
Buildings	109.5	91.5	​	Capital lease obligations	---	---
Equipment	119.1	99.6	​	Total Debt	239.7	168.9
Less accumulated   depreciation	(56.1)	(52.5)	​	Deferred taxes	22.8	22.2
Net property, plant, and equipment	239.1	200.7	​	Other long-term liabilities	---	---
Goodwill	60.0	--	​	Total long-term liabilities	262.5	191.1
Other long-term assets	63.0	42.0	​	Total liabilities	406.5	323.1
Total long-term assets	362.1	242.7	​	Stockholders' Equity	126.6	63.6
​	​	​	​	​	​	​
Total Assets	533.1	386.7	​	Total liabilities and Stockholders' Equity	533.1	386.7

Refer to the balance sheet above.  The change in Luther's quick ratio from 2005 to 2006 is closest to:
◦ a decrease of 0.10
◦ an increase of 0.10
◦ a decrease of 0.15
◦ an increase of 0.15

[lin77x]

an increase of 0.10

[vinney12]

Thank you!

[lin77x]

Always glad to help...

[123654777]

Use the table for the question(s) below.

Luther Corporation Consolidated Balance Sheet December 31, 2006 and 2005 (in $ millions)

Assets	2006	2005	​	Liabilities and Stockholders' Equity	2006	2005
Current Assets	​	​	​	Current Liabilities	​	​
Cash	63.6	58.5	​	Accounts payable	87.6	73.5
Accounts receivable	55.5	39.6	​	Notes payable / short-term debt	10.5	9.6
Inventories	45.9	42.9	​	Current maturities of long-term debt	39.9	36.9
Other current assets	6.0	3.0	​	Other current liabilities	6.0	12.0
Total current assets	171.0	144.0	​	Total current liabilities	144.0	132.0
​	​	​	​	​	​	​
Long-Term Assets	​	​	​	Long-Term Liabilities	​	​
Land	66.6	62.1	​	Long-term debt	239.7	168.9
Buildings	109.5	91.5	​	Capital lease obligations	---	---
Equipment	119.1	99.6	​	Total Debt	239.7	168.9
Less accumulated   depreciation	(56.1)	(52.5)	​	Deferred taxes	22.8	22.2
Net property, plant, and equipment	239.1	200.7	​	Other long-term liabilities	---	---
Goodwill	60.0	--	​	Total long-term liabilities	262.5	191.1
Other long-term assets	63.0	42.0	​	Total liabilities	406.5	323.1
Total long-term assets	362.1	242.7	​	Stockholders' Equity	126.6	63.6
​	​	​	​	​	​	​
Total Assets	533.1	386.7	​	Total liabilities and Stockholders' Equity	533.1	386.7

Refer to the balance sheet above.  If on December 31, 2005 Luther has 8 million shares outstanding trading at $15 per share, then what is Luther's market-to-book ratio?

[bassamabas]

market-to-book = market value of equity / book value of equity
market-to-book = 8 million × $15 / $63.6 = 1.89

[armygirl]

Use the table for the question(s) below.

Luther Corporation Consolidated Balance Sheet December 31, 2006 and 2005 (in $ millions)

Assets	2006	2005	​	Liabilities and Stockholders' Equity	2006	2005
Current Assets	​	​	​	Current Liabilities	​	​
Cash	63.6	58.5	​	Accounts payable	87.6	73.5
Accounts receivable	55.5	39.6	​	Notes payable / short-term debt	10.5	9.6
Inventories	45.9	42.9	​	Current maturities of long-term debt	39.9	36.9
Other current assets	6.0	3.0	​	Other current liabilities	6.0	12.0
Total current assets	171.0	144.0	​	Total current liabilities	144.0	132.0
​	​	​	​	​	​	​
Long-Term Assets	​	​	​	Long-Term Liabilities	​	​
Land	66.6	62.1	​	Long-term debt	239.7	168.9
Buildings	109.5	91.5	​	Capital lease obligations	---	---
Equipment	119.1	99.6	​	Total Debt	239.7	168.9
Less accumulated   depreciation	(56.1)	(52.5)	​	Deferred taxes	22.8	22.2
Net property, plant, and equipment	239.1	200.7	​	Other long-term liabilities	---	---
Goodwill	60.0	--	​	Total long-term liabilities	262.5	191.1
Other long-term assets	63.0	42.0	​	Total liabilities	406.5	323.1
Total long-term assets	362.1	242.7	​	Stockholders' Equity	126.6	63.6
​	​	​	​	​	​	​
Total Assets	533.1	386.7	​	Total liabilities and Stockholders' Equity	533.1	386.7

Refer to the balance sheet above.  If on December 31, 2005 Luther has 8 million shares outstanding trading at $15 per share, then what is Luther's enterprise value?

[lkoler]

Enterprise value = Market value of equity + Debt - Cash
Market value of equity = 8 million × $15 = $120 million
Debt = Notes payable + Current maturities of long-term debt + Long-term debt
Debt = 9.6 + 36.9 + 168.9 = 215.4
Cash = 58.5
So, enterprise value = $120 + 215.4 - 58.5 = $276.90.