Complete B.C, thank you
9. US REPUBLIC CORPORATION BALANCE SHEET, DECEMBER 31, 20X3 ASSETS Cash Accounts receivable Inventory Fixed assets, net $ 2,000,000 5,000,000 7,000,000 17,000,000 LIABILITIES AND SHAREHOLDERS' EQUITY Notes payable, bank $ 4,000,000 Accounts payable 2,000,00 Accrued wages and taxes 2,000,000 12,000,000 Preferred stock 4,000,000 Common stock 2.0X0,000 Retained earnings 4,000,000 Total liabilities and shareholders' equity Long-term debe Total assets $30,000,000 390,000,000 US REPUBLIC CORPORATION STATEMENT OF INCOME AND RETAINED EARNINGS, YEAR ENDED DECEMBER 31, 20X3 $16,000,000 4,000,000 $20,000,000 $12,000,000 2.200,000 1,400,000 1,200,000 Net sales Credit Cash Total Cost and Expenses Cost of goods sold Selling, general, and administrative expenses Depreciation Interest Net income before taxes Taxes on income Net income after taxes Less: Dividends on preferred stock Net income available to common shareholders Add: Retained earnings at 1/1/X3 Subtotal Less: Dividends paid on common stock Retained earnings 12/31/X3 $16,800,000 $3,200,000 1,200,000 $ 2,000,000 240,000 $1,760,000 2,600,000 $4,360.000 360,000 $ 4,000,000 a. Fill in the 20x3 column in the table that follows. US REPUBLIC CORPORATION 20X3 20X2 2009 90% RATIO 1. Current ratio 2. Acid-test ratio 3. Receivable turnover 4. Inventory turnover 5. Long-term debt total capitalization 6. Gross profit margin 7. Net profit margin 8. Return on equity 9. Return on investment 10. Total asset turnover 11. Interest coverage ratio 20X1 2509 100% 5.0x 4.0X % 3596 3996 17% 1596 15% 0.9% 5.5x 4.5x 3.0x 10% INDUSTRY NORMS 225% 110% 6.0% 4.0X 3396 40 15% 2096 12% 1.0x 5.0x 41% 15% 2096 129 0.8X 4.5 b. Evaluate the position of the company using information from the table. Cite specific ratio levels and trends as evidence. c. Indicate which ratios would be of most interest to you and what your decision would be in each of the following situations: (i) US Republic wants to buy $500,000 worth of merchandise inventory from you, with payment due in 90 days. (ii) US Republic wants you, a large insurance company, to pay off its note at the bank and assume it on a 10-year maturity basis at a current rate of 14 percent. (iii) There are 100,000 shares outstanding, and the stock is selling for $80 a share. The company offers you 50,000 additional shares at this price. 9. US REPUBLIC CORPORATION BALANCE SHEET, DECEMBER 31, 20X3 ASSETS Cash Accounts receivable Inventory Fixed assets, net $ 2,000,000 5,000,000 7,000,000 17,000,000 LIABILITIES AND SHAREHOLDERS' EQUITY Notes payable, bank $ 4,000,000 Accounts payable 2,000,00 Accrued wages and taxes 2,000,000 12,000,000 Preferred stock 4,000,000 Common stock 2.0X0,000 Retained earnings 4,000,000 Total liabilities and shareholders' equity Long-term debe Total assets $30,000,000 390,000,000 US REPUBLIC CORPORATION STATEMENT OF INCOME AND RETAINED EARNINGS, YEAR ENDED DECEMBER 31, 20X3 $16,000,000 4,000,000 $20,000,000 $12,000,000 2.200,000 1,400,000 1,200,000 Net sales Credit Cash Total Cost and Expenses Cost of goods sold Selling, general, and administrative expenses Depreciation Interest Net income before taxes Taxes on income Net income after taxes Less: Dividends on preferred stock Net income available to common shareholders Add: Retained earnings at 1/1/X3 Subtotal Less: Dividends paid on common stock Retained earnings 12/31/X3 $16,800,000 $3,200,000 1,200,000 $ 2,000,000 240,000 $1,760,000 2,600,000 $4,360.000 360,000 $ 4,000,000 a. Fill in the 20x3 column in the table that follows. US REPUBLIC CORPORATION 20X3 20X2 2009 90% RATIO 1. Current ratio 2. Acid-test ratio 3. Receivable turnover 4. Inventory turnover 5. Long-term debt total capitalization 6. Gross profit margin 7. Net profit margin 8. Return on equity 9. Return on investment 10. Total asset turnover 11. Interest coverage ratio 20X1 2509 100% 5.0x 4.0X % 3596 3996 17% 1596 15% 0.9% 5.5x 4.5x 3.0x 10% INDUSTRY NORMS 225% 110% 6.0% 4.0X 3396 40 15% 2096 12% 1.0x 5.0x 41% 15% 2096 129 0.8X 4.5 b. Evaluate the position of the company using information from the table. Cite specific ratio levels and trends as evidence. c. Indicate which ratios would be of most interest to you and what your decision would be in each of the following situations: (i) US Republic wants to buy $500,000 worth of merchandise inventory from you, with payment due in 90 days. (ii) US Republic wants you, a large insurance company, to pay off its note at the bank and assume it on a 10-year maturity basis at a current rate of 14 percent. (iii) There are 100,000 shares outstanding, and the stock is selling for $80 a share. The company offers you 50,000 additional shares at this price
