Given the following information please construct a balance sheet and an income statement for the company. It provides software via a cloud subscription. There is no inventory.
All information in $000
Total Revenues 5,374
Common Stock 651
Cost of Revenues Subscription 925
Interest Expense 16
Additional Paid in Capital 3,954
Retained Earnings (630)
Cost of Revenues Professional Services 365
Gross Margin 4,084
Short term securities 87
Long term debt 2,328
Accounts Receivable 1,906
Accounts Payable 1,103
Research & Development 793
Marketing & Sales 2,757
Other current liabilities 3,287
Other current assets 649
Investment income 10
General & Administrative Expense 680
Property & Equipment 1,126
Other long term assets 2,234
Total Current Assets 3,550
Total Operating Income (146)
Net Loss (600)
Total assets 10,693
What is the gross margin as a % of sales? Why is this important to the entrepreneur and the investor?
What is the EBITDA? Why is this important?
What is the interest coverage ratio? (EBITDA / Interest expense) Why is this important?
What is the current ratio? (Current assets / current liabilities) Why is this important to the investor and the entrepreneur?