1| Following are the informati

1| Following are the information given for
Cafes Richard Bangladesh Cafés Richard Bangladesh 2020 Income
Statement Net sales Tk. 5,680,000 Cost of goods sold (4,060,000)
Depreciation (420,000) Earnings before interest and taxes 1,200,000
Less: Interest paid (30,000) Taxable Income 1,170,000 Less: Taxes
(410,000) Net income Tk. 760,000 Dividends 500,000 Cafés Richard
Bangladesh Comparative Balance Sheets 2019 2020 2019 2020 Cash
70,000 180,000 Accounts payable 1,350,000 1,170,000 Accounts rec.
980,000 840,000 Long-term debt 720,000 500,000 Inventory 1,560,000
1,990,000 Common stock 3,200,000 3,500,000 Total Current Assets
2,610,000 3,010,000 Retained earnings 940,000 1,200,000 Net fixed
assets 3,600,000 3,360,000 Total assets 6,210,000 6,370,000 Total
liabilities & equity 6,210,000 6,370,000 Required a. What is
the Internal Growth rate for Cafes Richard BD? What is the
sustainable growth rate for Gloria Jeans BD? If sales grow at SGR,
how much External Financing will be needed for the year 2021 using
Percentage of sales approach, assuming that the firm is operating
at full capacity? Interest expense and tax rate will not change.
Calculate the tax rate (hint: tax rate = tax/taxable income).
Please create pro forma statements as well. What’s the impact in
the new Debt to equity ratio, if any? (4+4+4+4=15) b. Comment on
the liquidity position and leverage position of Cafés Richard,
using current ratio, quick ratio, and cash ratio for both 2019 and
2020 ; operating leverage ratio for only 2020 (12) in order to
calculate O.L you’ll need previous year sales and EBIT info as
well. The info is as follows: 2019: Sales 5 million EBIT: 1 million
c. Choose the foreign company (assigned to your group) and comment
on their market position. Your answer must be in essay format.
Address the following issues in your answer: Using any of the
following as source of info: yahoo finance, wsj quotes,
investing.com) (8) • Market Price today, EPS (calculate) • The P/E
• Is the stock expensive? Yes or No? Justify your answer • How many
years will it take to recover the investment if earnings remain the
same? • Will the stock price go up or down?

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