A45

*Please help with number 12*

Measures of liquidity, Solvency, and Profitability The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $82.60 on December 31, 20Y2. Marshall Inc. Comparative Retained Earnings Statement For the Years Ended December 31, 20Y2 and 2041 20Y2 2011 Retained earnings, January 1 $3,704,000 $3,264,000 550,000 Net income 600,000 Dividends: On preferred stock (10,000) (100,000) (10,000) (100,000) On common stock Retained earnings, December 31 $4,194,000 $3,704,000 Marshall Inc. Comparative Income Statement For the Years Ended December 31, 2012 and 2041 2012 2011 Sales $10,850,000 $10,000,000 Cost of merchandise sold 6,000,000 5,450,000 Gross profit $4,550,000 Selling expenses $4,850,000 $2,170,000 1,627,500 $3,797,500 $1,052,500 $2,000,000 1,500,000 Administrative expenses Total operating expenses Income from operations $3,500,000 $1,050,000 Other revenue and expense: Other revenue 99,500 (132,000) 20,000 (120,000) Other expense (interest) Income before income tax expense $1,020,000 $950,000 Income tax expense 420,000 400,000 Net income $600,000 $550,000 Marshall Inc. Comparative Balance Sheet December 31, 2012 and 2041 2012 Assets 2011 Current assets: Cash $1,050,000 $ 950,000 Marketable securities 301,000 420,000 500,000 585,000 420,000 108,000 380,000 20,000 Accounts receivable (net) Inventories Prepaid expenses Total current assets Long-term investments Property, plant, and equipment (net) Total assets $2,464,000 $2,270,000 800,000 800,000 5,760,000 5,184,000 $9,024,000 $8,254,000 Liabilities Current liabilities $880,000 $800,000 $200,000 3,000,000 $0 $3,000,000 $3,000,000 $3,200,000 $4,080,000 $3,800,000 Long-term liabilities: Mortgage note payable, 6% Bonds payable, 4% Total long-term liabilities Total liabilities Stockholders' Equity Preferred 4% stock, $5 par Common stock, $5 par Retained earnings Total stockholders' equity $250,000 500,000 $250,000 500,000 3,704,000 4,194,000 $4,944,000 $4,454,000 Total liabilities and stockholders' equity $9,024,000 $8,254,000 Required: Determine the following measures for 2012, rounding to one decimal place, except dollar amounts which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year. 1. Working capital 1,584,000 2. Current ratio 2.8 3. Quick ratio 2.2 4. Accounts receivable turnover 20.0 18.3 days 5. Number of days' sales in receivables 6. Inventory turnover 15.0 7. Number of days' sales in inventory 24.3 days 1.8 8. Ratio of fixed assets to long-term liabilities 9. Ratio of liabilities to stockholders' equity 0.8 10. Times interest earned 8.7 11. Asset turnover 1.3 12. Return on total assets 7.0 X % 13. Return on stockholders' equity 12.8 % 14. Return on common stockholders' equity 13.3 % 15. Earnings per share on common stock 5.9 14 16. Price-earnings ratio 17. Dividends per share of common stock 18. Dividend yield $ 1 1.2 %