Hey guys, I'm working on an assignment and I seem to be stuck trying to get the balance sheet to balance out. Hoping someone could take a look to see where I went wrong and point me in the right direction.
Any help would be appreciated.
Thanks
| Attachment | Size |
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| dcf_assignment.xls 70.5 KB | 70.5 KB |
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bump
Lol, don't bump your post one hour after posting it.
Out of curiosity, where did you learn to model? There are a few nuances that are very odd to me.
You're going to have the most success walking through the balance sheet and making sure that you've accounted for any changes in the cash flow statement. With that said, from a quick look, I don't see you factoring in dividend liabilities, deferred tax liabilities or other long-term liabilities in the cash flow statement. It would also be helpful to start the cash flow statement with net income rather than EBITDA so that you can break out D&A and verify those independently.
Hey sorry for the quick bump, on a tight deadline with this just trying to get it done. Appreciate the feedback though. This isn't usually how I set up my models, unfortunately this formatting is how it was assigned and was told to make minimal changes to it.
I dug through it for a little bit. From what I can see you may be incorrectly accounting for the dividends. You're pulling net income into the retained earnings account before subtracting a dividend, but also then recording the liability for dividends to be paid. Also, you're subtracting the prior year's dividend from the current period's retained earnings, removing the associated liability, and also recording the change in the cash flow statement and reducing the current period cash.
Lastly, the tax liability calculation in the cash flow is wrong. You're taking 20% of the prior year's payment, instead of 20% of the total tax. Hope my response isn't too convoluted. Good luck
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