In its annual report, WRS Athletic Supply, Inc., includes the following five-year financial summary. Requirement 1. Analyze
Question:
Requirement
1. Analyze the companys financial summary for the fiscal years 20112015 to decide whether to invest in the common stock of WRS. Include the following sections in your analysis, and fully explain your final decision.
a. Trend analysis for net sales and net income (use 2011 as the base year).
b. Profitability analysis.
c. Evaluate the ability to sell inventory (WRS uses the LIFO method).
d. Evaluate the ability to pay debts.
e. Evaluate thedividends.
Transcribed Image Text:
WRS ATHLETIC SUPPLY, INC. Five-Year Financial Summary (Partial; adapted) (Dollar amounts in thousands except per share data) Net sales 2015 2014 2013 2012 2011 2010 $244,524 $217,799 $191,329 S165,013 $137,634 Net sales increase 16% 20% 12% 14% 17% Domestic comparative store sales increase 5% 8% 9% 5% 6% Other income-net 2,001 1,873 1,787 1,615 1,391 150,255 129,664 Cost of sales 108,725 191,838 171,562 Opcrating, selling, and general and administrative expenses 41,236 36,356 31,679 27,408 22,516 Interest: 1,357 803 Interest expense 1,063 1,383 1,045 (138) Interest income (171) (188) (204) (189) 3,338 Income tax expense 4,487 3,897 3,692 2,740 4,430 Net income 8,039 6,671 6,295 5,377 Per share of common stock: Net income 1.81 1.49 1.41 1.21 0.99 Dividends Financial Position 0.30 0.28 0.24 0.20 0.16 $ 30,483 $ 27,878 $ 26,555 S 24,356 $ 21,132 Current assets, excluding inventory Inventorics at LIFO cost 17,076 25,973 $16,497 24,891 22,614 21,442 19,793 Property, plant, and cquipment, net 51,904 45,750 40,934 35,969 Total assets 83,527 94,685 78,130 70,349 49,996 Current liabilities 27,282 16,762 12,122 32,617 28,949 25,803 Long-term debt 17,838 22,731 21,143 18,712 Sharcholders' equity 25,834 21,112 39,337 35,102 31,343 Financial Ratios 0.9 Acid-test ratio 0.9 1.0 0.9 1.3 Rate of return on total asscts 10.2% 9.6% 9.9% 10.3% 10.7% Rate of return on sharcholders' equity 22.9% 21.6% 20.1% 22.0% 22.4%
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 56% (16 reviews)
Req 1 Trend Analysis 2015 2014 2013 2012 2011 Net sales 178 158 139 120 100 Net income 181 151 14...View the full answer
Answered By
John Kimutai
I seek to use my competencies gained through on the job experience and skills learned in training to carry out tasks to the satisfaction of users. I have a keen interest in always delivering excellent work
4.70+
11+ Reviews
24+ Question Solved
Related Book For
Financial and Managerial Accounting
ISBN: 978-0132497978
3rd Edition
Authors: Horngren, Harrison, Oliver
Question Posted:
Students also viewed these Accounting questions
-
In its annual report for 2010, HMV Group pic showed total revenues of 2,016.6 million for 2010 versus 1,956.7 million for 2009, and net accounts receivable balances of 80.7 million at the end of 2010...
-
The JB Hi-Fi Ltd governance statement in its annual report discusses the code of conduct of the company. What are the key elements of the code?
-
A company has to decide whether to invest money in the development of a microbiological product. The company's research director has estimated that there is a 60% chance that a successful development...
-
. What impacts of influences adult human behavior? Perspective Support: You must critically evaluate the issue and address the question: " What influences or impacts personality development?" by...
-
Data pertaining to the current position of Forte Company follow: Cash...........................................................$412,500 Marketable securities................................187,500...
-
Improvement in quality of life was measured for a group of heart disease patients after 8 weeks in an exercise program. This experimental group was compared to a control group who were not in the...
-
The Billboard Company has a deferred tax liability in the amount of \(\$ 14,000\) at December 31, 2020, relating to a \(\$ 40,000\) installment sale receivable, \(\$ 20,000\) of which is collected in...
-
Edison Systems has estimated the cash flows over the 5-year lives for two projects, A and B. These cash flows are summarized in the table below. a. If project A were actually a replacement for...
-
What are the best investments for youngMalaysians?This current affairs article (which appeared inComputerworld.com July 2005) discusses howunderstanding net present value (NPV) can increase aninf 2...
-
1. Robert, a rational investor, has $500,000 to invest, He can choose either a risk-free Canada Savings Bond (CSB), or shares of Pronghorn Manufacturing Inc. (Pronghorn), a publicly listed company. ...
-
Amazon.coms financial statements in Appendix A at the end of this book reveal some interesting relationships. Answer these questions about Amazon: Requirements 1. Compute trend analyses for net sales...
-
Supreme Water Sports has 12,000 shares of $2 par common stock outstanding. Supreme distributes a 5% stock dividend when the market value of its stock is $22 per share. Requirements 1. Journalize...
-
Which of the following SELECT statements lists only the book with the largest profit? a. SELECT title, MAX (retail-cost) FROM books GROUP BY title; b. SELECT title, MAX (retail-cost) FROM books GROUP...
-
what ways do team-based learning approaches facilitate knowledge transfer, skill development, and collective intelligence within teams, and how can organizations support continuous learning and...
-
How do emerging technologies such as blockchain and decentralized databases disrupt traditional centralized data management paradigms, enabling trustless, transparent, and immutable data storage and...
-
1. Take the two vectors W and N above. N is in the north direction, where the vertical component of Wis equal to the magnitude to N. If theta is 5 degrees and N is 2 then what is the resultant...
-
On January 3 0 , Pier 5 Inc. issued 5 0 0 shares of $ 1 par common stock for $ 1 5 per share. On June 3 0 , Pier 5 Inc. reacquired 5 0 shares of common stock at $ 1 2 per share and immediately...
-
Peruse your library or internet and select a company's annual report that you find compelling and interesting. There are many annual reports readilyviewable online and some of them are digital which...
-
A debt of $\$ 25,000$ is to be amortized over 7 years at $7 %$ interest. What value of monthly payments will achieve this?
-
Assessing simultaneous changes in CVP relationships Braun Corporation sells hammocks; variable costs are $75 each, and the hammocks are sold for $125 each. Braun incurs $240,000 of fixed operating...
-
DK Limited and SK Limited amalgamated on 1st April, 2010. All the assets and liabilities of both the companies were acquired by newly established company DS Limited. The following was the balance...
-
Employees are subject to taxes withheld from their paychecks. (a) List the federal taxes withheld from most employee paychecks. (b) Give the title of the accounts credited by amounts withheld.
-
Employees are subject to taxes withheld from their paychecks. (a) List the federal taxes withheld from most employee paychecks. (b) Give the title of the accounts credited by amounts withheld.
-
Why are deductions from employees earnings classified as liabilities for the employer?
-
1)Modify the program and Find the Factorial for number 10. 2) Modify the program to prompt the user to enter an integer number Less than 25 and Find the Factorial for the number and (Best use while...
-
Ciganda Company produces and sells strings of colorful indoor/outdoor lights for holiday display to retailers for $8.10 per string. The variable costs per string are as follows: Line Item Description...
-
compltez le code ci-dessous, pour obtenir la sortie suivante : 10 Adding the square of each index 0 1 4 9 16 25 36 49 64 81 (size = 10) (rec_size = 10) 1 4 9 16 25 36 49 64 81 (size = 9) (rec_s...
Study smarter with the SolutionInn App