54 5:56 Foundations of financial mana... accounts payaure mercado by se pereem. Howes payatie mereused by and bonds payable decreased by $12,500, both at the end of the year. The preferred stock, common stock, and paid-in capital in excess of par accounts did not change. a. Prepare an income statement for 20X2. b. Prepare a statement of retained earnings for 20X2. C. Prepare a balance sheet as of December 31, 20X2. 28. Refer to the following financial statements for Crosby Corporation: a. b. C. Prepare a statement of cash flows for the Crosby Corporation using the general procedures indicated in Table 2-10. Describe the general relationship between net income and net cash flows from operating activities for the firm. Has the buildup in plant and equipment been financed in a satisfactory manner? Briefly discuss. d. Compute the book value per common share for both 20X1 and 20X2 for the Crosby Corporation. Part 2 Financial Analysis and Planning e. Sales..... Cost of goods sold. Gross profit...... If the market value of a share of common stock is 3.3 times book value for 20X1, what is the firm's P/E ratio for 20X2? Selling and administrative expense.. Depreciation expense........ Operating income Interest expense. CROSBY CORPORATION Income Statement For the Year Ended December 31, 20X2 Earnings before taxes. Taxes Earnings after taxes Preferred stock dividends Earnings available to common stockholders. Shares outstanding.. Earnings per share Assets Current assets: Statement of Retained Earnings For the Year Ended December 31, 20X2 Retained earnings, balance, January 1, 20X2. Add: Earnings available to common stockholders, 20X2. Deduct: Cash dividends declared and paid in 20X2 Retained earnings, balance, December 31, 20X2....... Cash..... Accounts receivable (net).. Comparative Balance Sheets For 20X1 and 20X2 Inventory. Prepaid expenses. Total current assets.. Investments (long-term securities). Plant and equipment....... Less: Accumulated depreciation Net plant and equipment...... Total assets.... Year-End 20X1 $ 70,000 300,000 410,000 50,000 $830,000 80,000 2,000,000 1,000,000 $1,000,000 $1,910,000 5G O Statement of cash flows (LO2-4) $2,200,000 1,300,000 $ 900,000 420,000 150,000 $ 330,000 90,000 $ 240,000 80,000 $ 160,000 10,000 $ 150,000 120,000 1.25 $ $500,000 150,000 50,000 $600,000 Year-End 20X2 Done $ 100,000 350,000 430,000 30,000 $910,000 70,000 2,400,000 1,150,000 $1,250,000 $2,230,000 (continued)

5:56 .II 56 Foundations of financial mana... c. Prepart a balance ted as of December 31,202. pencral procolures indcated in Talk 2-10. Uatimei liat thes tratef? from eperating astrities for ter firm muner? Briefly ascess. AeConty Corporation. 54 5:56 .II 56 Foundations of financial mana... c. Prepart a balance ted as of December 31,202. pencral procolures indcated in Talk 2-10. Uatimei liat thes tratef? from eperating astrities for ter firm muner? Briefly ascess. AeConty Corporation. 54