Pinnacle 1

Pinacle Part I

a)

Account balance | % Change 2012-2013 | % Change 2011-2012 |

Net sales | 1,43% | 2,62% |

COGS | 2,77% | 4,02% |

EBIT | 9,35% | -61,23% |

Cash & cash eq. | 5,13% | -10,13% |

Net receivables | 33,91% | 7,93% |

Inventories | 20,78% | 1,04% |

Total current assets | 21,72% | 0,53% |

Total current liabi. | 29,2% | 12,0% |

b)

Ratio | 2013 | 2012 | 2011 |

Short-Term Debt Paying |   |   |   |

Cash Ratio | 25,39% | 34,03% | 42,59% |

Current ratio | 1,75 | 1,93 | 2,19 |

Liquidity Activity Ratio |   |   |   |

A/R Turnover | 13,92 | 17,95 |   |

Inventory Turnover | 3,78 | 4,18 |   |

Ability to meet LT Debt Obl |   |   |

Debt to equity | 90,48% | 73,86% | 70,81% |

TIE | 1,96 | 1,83 | 2,28 |

Profitability Ratios |   |   |   |

Gross Profit Percent | 27,50% | 28,49% | 29,51% |

Profit margin | 0,03 | 0,03 | 0,04 |

Return on asset | 0,0191 | 0,0187 |   |

Return on common equity | 0,035 | 0,032 |   |

c)

Pinacle Manufacturing is a Corporation composed by three divisions:

* Welburn

* Solar-Powered: recently acquired because the management expected this new market would be very profitable

* Machine-Technology : second year of operations. Should the management sell this division?

Pinacle is principally financed by the equity, although the proportion of its debts increased.

Even if the profit margin remained the same for the past three year, the earnings per share decreased strongly between 2011 and 2012(-65%), and slightly get back in 2013 (17%). More analysis question g and h.

d)

Pinnacle Manufacturing Company |   |   |   |

Income Statement - All Divisions | | |   |

For the Year Ended December 31 | | |   |

  | | | | | |   |

  | 2013 |   | 2012 |   | 2011 |   |

  | Dollar Value |   | Dollar Value |   | Dollar Value |   |

Sales | 150 918 731 | 100,12% | 148 764 555 | 100,12% | 144 860 245 | 100,12% |

Sales Returns and Allowances | 181 103 | 0,12% | 178 518 | 0,12% |...