INTRODUCTION The purpose of this graded project is to bring together in a practical way some important concepts you’ve learned in the course.
Once you’ve completed this project, you can perform similar analyses on other organiza- tions. Some of the work for this project will be completed in Excel. Once you’ve completed these problems in Excel, and if you’ve linked all your cells properly, you can reuse your spreadsheets, only changing the inputs. Go to your student portal and download the 500306_Project_Files. This spreadsheet contains information needed to complete the project. You’ll be submitting this Excel spreadsheet along with your project.
Part 1: El Cap Climbing Company El Cap Climbing Company (ECCC) is a small startup that manufactures and sells high-quality climbing gear in Fresno, California. The founder of the company, Leah, has been incredibly successful, but hasn’t kept the company’s financial records as well as she might have.
The initial investment for El Cap was provided by her friends and family, and was small. However, current operations can’t meet the demand for the product, and Leah has plans to increase both production and the number of storefronts.
These plans require a large investment from both equity and debt financing. The new investors and creditors require detailed financial statements. Leah has hired you, a finan- cial analyst, to prepare these statements and give insight into the financial position of the firm. Leah has provided information from her bank statements, bills, and receipts in an Excel spreadsheet, which is found in your downloaded project files. She explained to you that taxes are paid at a rate of 30 percent, and dividends are paid at a rate of 40 per- cent. (Note: You can create the statements in the same Excel spreadsheet that has the financial information. Be sure to let the instructor know if you choose to do this instead of creating them in a Word document.)
Prepare the following:
n An income statement for 2015 and 2016
n A balance sheet for 2015 and 2016
n Operating cash flows for the two years
n Cash flows from assets in 2016