ALLENDALE COMPANY Balance Sheets As of December 31 Year 4 Year 3 $ 40,000 20,000 54,000 135,000 25,000 274,000 27,000 270,000 29,000 $600,000 $ 36,000 6,000 46,000 143,000 10,000 241,000 20,000 255,000 24,000 $540,000 Assets Current assets Cash Marketable securities Accounts receivable (net) Inventories Prepaid items Total current assets Investments plant (net) Land Total assets Liabilities and Stockholders' Equity Liabilities Current liabilities Notes payable Accounts payable Salaries payable Total current liabilities Noncurrent liabilities Bonds payable Other Total noncurrent liabilities Total 1914 $ 17,000 113,800 21,000 151, 800 $ 6,000 100,000 15,000 121,000 100,000 32,000 132,000 22 A 100,000 27,000 127,000 A A $ 17,000 113,800 21,000 151,800 $ 6,000 100,000 15,000 121,000 Notes payable Accounts payable Salaries payable Total current liabilities Noncurrent liabilities Bonds payable Other Total noncurrent liabilities Total liabilities Stockholders' equity Preferred stock, (par value $10, 4% cumulative, non-participating; 8,000 shares authorized and issued) Common stock (no par; 50,000 shares authorized; 10,000 shares issued) Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 100,000 32,000 132,000 283,800 100,000 27,000 127,000 248,000 80,000 80,000 156,200 316, 200 $600,000 80,000 80,000 132,000 292,000 $540,000 ALLENDALE COMPANY Statements of Income and Retained Earnings For the Years Ended December 31 Year 4 Revenues Sales (net) $230,000 Other revenues 8,000 Total revenues 238,000 Year 3 $210,000 5,000 215,000 Year 3 $210,000 5,000 215,000 ALLENDALE COMPANY Statements of Income and Retained Earnings For the Years Ended December 31 Year 4 Revenues Sales (net) $230,000 other revenues 8,000 Total revenues 238,000 Expenses Cost of goods sold 120,000 Selling, general, and administrative 55,000 Interest expense 8,000 Income tax expense 23,000 Total expenses 206,000 Net earnings (net income) 32,000 Retained earnings, January 1 132,000 Less: Preferred stock dividends 3,200 Common stock dividends 4,600 Retained earnings, December 31 $156,200 103,000 50,000 7,200 22.000 182.200 32.809 107,000 3,200 4,600 $132.000 Required Calculate the following ratios for Year 4 and Year 3. Since Year 2 numbers are not presented do not use averages when calculating the ratios for Year 3. Instead, use the number presented on the Year 3 balance sheet a. Working capital b. Current ratio. (Round your answers to 2 decimal places.) C. Quick ratio. (Round your answers to 2 decimal places.) d. Receivables turnover (beginning receivables at January 1, Year 3, were $47,000). (Round your answers to 2 decimal places.) e. Average days to collect accounts receivable. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) f. Inventory turnover (beginning inventory at January 1, Year 3, was $140,000). (Round your answers to 2 decimal places.) g. Number of days to sell inventory. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) h. Debt-to-assets ratio. (Round your answers to the nearest whole percent.) 1. Debt-to-equity ratio. (Round your answers to 2 decimal places.) J. Number of times interest was earned. (Round your answers to 2 decimal places.) k. Plant assets to long-term debt. (Round your answers to 2 decimal places.) 1. Net margin (Round your answers to 2 decimal places.) m. Turnover of assets (average total assets in Year 3 is $540,000). (Round your answers to 2 decimal places.) n. Return on investment (average total assets in Year 3 is $540,000). (Round your answers to 2 decimal places.) o. Return on equity (average stockholders' equity in Year 3 is $292.000). (Round your answers to 2 decimal places.) p. Earnings per share (total shares outstanding is unchanged). (Round your answers to 2 decimal places.) q. Book value per share of common stock. (Round your answers to 2 decimal places.) 1. Price-earnings ratio (market price per share: Year 3. $11.75: Year 4. $12.50). (Round your intermediate calculations and final answer to 2 decimal places.) 5. Dividend yield on common stock. (Round your answers to 2 decimal places.) Year 4 Year 3 times times days times days days times days a Working capital b. Current ratio c. Quick ratio d. Receivables turnover (beginning receivables at January 1, Year 3, were $17,000) e. Average days to collect accounts receivable 1. Inventory turnover (beginning inventory at January 1, Year 3, was $140,000) g Number of days to sell inventory h. Debt-to-assets ratio Debt-to-equity ratio Number of times interest was earned Plant assets to long term debt Net margin m Turnover of assets (average total assets in Year 3 is $540,000) n. Return on investment (average total assets in Year 3 is $540,000) 0. Return on equity (average stockholders' equity in Year 3 is $292,000) p. Earnings per share total shares outstanding is unchanged) 9. Book value per share of common stock Price-earnings ratio (market price per share Year 3, $11.75: Year 4, $12.50) s. Dividend yield on common stock times times % % 1% 1% per share per share per share per share % %