Alberta Playground Inc. produces, markets, distributes, and installs durable playground equipment. It is a new, growing playground distributor in Canada, and is hoping to expand to other provinces shortly. Its head office is in Edmonton, Alberta, and its 2020 and 2019 balance sheets and income statements follow.
| Alberta Playground Inc. |
| Balance Sheet ($000) |
| Years Ended March 31 |
| | 2020 | 2019 |
| Assets | | | | | | |
| Current assets | | | | | | |
| Cash and cash equivalents | $ | 78,091 | | $ | 55,419 | |
| Receivables | | 461,407 | | | 367,669 | |
| Inventories | | 663,694 | | | 568,254 | |
| Prepaid expenses and other assets | | 51,120 | | | 29,674 | |
| Non-strategic investment | | 27,863 | | | 120 | |
| Other current assets | | 33,103 | | | 28,422 | |
| Total current assets | $ | 1,315,278 | | $ | 1,049,558 | |
| Portfolio investment | | 0 | | | 41,343 | |
| Property, Plant, & Equipment | | 1,051,150 | | | 1,062,756 | |
| Goodwill | | 850,230 | | | 719,095 | |
| Trademarks and other intangibles | | 340,838 | | | 318,413 | |
| Other assets | | 139,093 | | | 94,566 | |
| Total assets | $ | 3,696,589 | | $ | 3,285,731 | |
| Liabilities | | | | | | |
| Current liabilities | | | | | | |
| Bank loans | $ | 171,189 | | $ | 62,172 | |
| Accounts payable and accrued liabilities | | 574,679 | | | 472,006 | |
| Income taxes payable | | 199,238 | | | 149,977 | |
| Current portion of long term debt | | 28,319 | | | 8,759 | |
| Total current liabilities | $ | 973,425 | | $ | 692,914 | |
| Non-Current Liabilities | | | | | | |
| Long-term debt | | 379,680 | | | 381,990 | |
| Other liabilities | | 189,583 | | | 153,969 | |
| Total liabilities | $ | 1,542,688 | | $ | 1,228,873 | |
| Equity | | | | | | |
| Common shares | $ | 623,675 | | $ | 590,749 | |
| Retained earnings | | 1,530,226 | | | 1,466,109 | |
| Total equity | $ | 2,153,901 | | $ | 2,056,858 | |
| Total liabilities and equity | $ | 3,696,589 | | $ | 3,285,731 | |
| |
| Alberta Playground Inc. |
| Income Statement ($000) |
| Years Ended March 31 |
| | 2020 | 2019 |
| Revenues | $ | 6,085,470 | | $ | 5,870,582 | |
| Cost of sales, selling and administrative expenses | | 5,247,330 | | | 5,130,511 | |
| Depreciation and amortization expense | | 106,332 | | | 115,006 | |
| Operating profit | | 731,808 | | | 625,065 | |
| Interest on long-term debt | | 23,391 | | | 30,081 | |
| Other expenses | | 14,863 | | | 5,761 | |
| Earnings before income taxes | | 693,554 | | | 589,223 | |
| Income taxes | | 199,715 | | | 163,789 | |
| Profit | $ | 493,839 | | $ | 425,434 | |
| |
Assume the common shares represent 204,430 (thousand) shares issued and outstanding for the entire year ended March 31, 2020. Required: 1. Prepare a common-size balance sheet and income statement on a comparative basis for 2019 and 2020. (Round the final percentage answers to 2 decimal places. Negative answers should be indicated by a minus sign.)
2. Calculate the 2020 ratios for Alberta Playground Inc. including a comparison against the industry averages. (Round the final answers to 2 decimal places.)
Check my work 3 Alberta Playground Inc. produces, markets, distributes, and installs durable playground equipment. It is a new, growing playground distributor in Canada, and is hoping to expand to other provinces shortly. Its head office is in Edmonton, Alberta, and its 2020 and 2019 balance sheets and income statements follow. 10 points Alberta Playground Inc. Balance Sheet ($000) Years Ended March 31 2020 2019 eBook Print References Assets Current assets Cash and cash equivalents Receivables Inventories Prepaid expenses and other assets Non-strategic investment Other current assets Total current assets Portfolio investment Property, Plant, & Equipment Goodwill Trademarks and other intangibles Other assets Total assets Liabilities Current liabilities Bank loans Accounts payable and accrued liabilities Income taxes payable Current portion of long term debt $ 78,091 $ 55,419 461,407 367,669 663,694 568,254 51,120 29,674 27,863 120 33, 103 28,422 $1,315,278 $1,049,558 0 41, 343 1,051, 150 1,062,756 850,230 719,095 340,838 318,413 139,093 94,566 $3,696,589 $3,285,731 $ 171,189 $ 574,679 199, 238 28,319 62,172 472,006 149,977 8,759 --- ------1:-1:11... Check my work 3 $ 171, 189 $ 574,679 199,238 28,319 $ 973,425 62,172 472,006 149,977 8,759 692,914 10 points Liabilities Current liabilities Bank loans Accounts payable and accrued liabilities Income taxes payable Current portion of long term debt Total current liabilities Non-Current Liabilities Long-term debt Other liabilities Total liabilities Equity Common shares Retained earnings Total equity Total liabilities and equity 379,680 381,990 189,583 153,969 $1,542,688 $1,228,873 I eBook Print $ 623,675 $ 590,749 1,530,226 1,466,109 $2,153,901 $2,056,858 $3,696,589 $3,285,731 References Alberta Playground Inc. Income Statement ($000) Years Ended March 31 Revenues Cost of sales, selling and administrative expenses Depreciation and amortization expense Operating profit Interest on long-term debt Other expenses Earnings before income taxes Income taxes Profit 2020 2019 $6,085,470 $5,870,582 5,247,330 5,130,511 106,332 115,006 731,808 625,065 23,391 30,081 14,863 5,761 693,554 589,223 199,715 163,789 $ 493,839 425,434 Check my work 3 Alberta Playground Inc. Income Statement ($000) Years Ended March 31 10 points Revenues Cost of sales, selling and administrative expenses Depreciation and amortization expense Operating profit Interest on long-term debt Other expenses Earnings before income taxes Income taxes Profit 2020 2019 $6,085,470 $5,870,582 5,247,330 5,130,511 106,332 115,006 731,808 625,065 23,391 30,081 14,863 5,761 eBook 693,554 199,715 493,839 $ 589,223 163,789 425,434 Print $ References Assume the common shares represent 204,430 (thousand) shares issued and outstanding for the entire year ended March 31, 2020. Required: 1. Prepare a common-size balance sheet and income statement on a comparative basis for 2019 and 2020. (Round the final percentage answers to 2 decimal places. Negative answers should be indicated by a minus sign.) ALBERTA PLAYGROUND INC. Common-Size Comparative Balance Sheet As at March 31, 2020 and March 31, 2019 2020 (%) 2019 (%) Assets Check my work 3 Required: 1. Prepare a common-size balance sheet and income statement on a comparative basis for 2019 and 2020. (Round the final percentage answers to 2 decimal places. Negative answers should be indicated by a minus sign.) 10 points eBook 2019 (%) Print References ALBERTA PLAYGROUND INC. Common-Size Comparative Balance Sheet As at March 31, 2020 and March 31, 2019 2020 (%) Assets Current assets Cash and cash equivalents Receivables Inventories Prepaid expenses and other assets Non-strategic investment Other current assets Total current assets Portfolio investment Property, plant and equipment Goodwill Trademarks and other intangibles Check my work 3 10 points eBook Print References Non-strategic investment Other current assets Total current assets Portfolio investment Property, plant and equipment Goodwill Trademarks and other intangibles Other assets Total assets Liabilities Current liabilities Bank loans Accounts payable and accrued liabilities Income taxes payable Current portion of long-term debt Total current liabilities Long-term debt Other liabilities Total liabilities Equity Common shares Check my work m. "TUULITRU VITU VLICE ILITY Other assets 10 points eBook Print References Total assets Liabilities Current liabilities Bank loans Accounts payable and accrued liabilities Income taxes payable Current portion of long-term debt Total current liabilities Long-term debt Other liabilities Total liabilities Equity Common shares Retained earnings Total equity Total liabilities and equity Check my work m. 10 points eBook 2019 (%) Print References ALBERTA PLAYGROUND INC. Common-Size Comparative Income Statement Years ended March 31, 2020 and March 31, 2019 2020 (%) Revenues Cost of sales and selling, general and administrative Depreciation and amortization expense Operating profit Interest on long-term debt Other expenses Profit before income taxes Income taxes Profit Check my work 3 10 points 2. Calculate the 2020 ratios for Alberta Playground Inc. including a comparison against the industry averages. (Round the final answers to 2 decimal places.) eBook Ratio Favourable or Unfavourable Print References :1 times % % Current ratio Total asset turnover Debt ratio Equity ratio Times interest earned Profit margin Return on total assets Earnings per share Industry Average 1.6:1 2.3 times 35 % 65 % 50 times 14 % 20% $ 1.79 times % %
