Question
Condensed balance sheet and income statement data for Ayayai Corporation are presented here. AYAYAI CORPORATION Balance Sheets December 31 2017 2016 2015 Cash $ 31,000
Condensed balance sheet and income statement data for Ayayai Corporation are presented here.
AYAYAI CORPORATION Balance Sheets December 31 | ||||||
2017 | 2016 | 2015 | ||||
Cash | $ 31,000 | $ 21,000 | $ 19,000 | |||
Accounts receivable (net) | 51,000 | 46,000 | 49,000 | |||
Other current assets | 92,000 | 97,000 | 66,000 | |||
Investments | 57,000 | 72,000 | 47,000 | |||
Plant and equipment (net) | 500,000 | 370,000 | 358,000 | |||
$731,000 | $606,000 | $539,000 | ||||
Current liabilities | $ 86,000 | $ 81,000 | $ 71,000 | |||
Long-term debt | 147,000 | 87,000 | 52,000 | |||
Common stock, $10 par | 322,000 | 312,000 | 302,000 | |||
Retained earnings | 176,000 | 126,000 | 114,000 | |||
$731,000 | $606,000 | $539,000 |
AYAYAI CORPORATION Income Statements For the Years Ended December 31 | ||||
2017 | 2016 | |||
Sales revenue | $742,000 | $602,000 | ||
Less: Sales returns and allowances | 41,000 | 31,000 | ||
Net sales | 701,000 | 571,000 | ||
Cost of goods sold | 427,000 | 352,000 | ||
Gross profit | 274,000 | 219,000 | ||
Operating expenses (including income taxes) | 181,000 | 151,000 | ||
Net income | $ 93,000 | $ 68,000 |
Additional information:
1. | The market price of Ayayais common stock was $7.00, $7.50, and $8.50 for 2015, 2016, and 2017, respectively. | |
2. | You must compute dividends paid. All dividends were paid in cash. |
(a) Compute the following ratios for 2016 and 2017.
2017 | 2016 | |||||
Profit margin |
| % |
| % | ||
Gross profit rate |
| % |
| % | ||
Asset turnover |
| times |
| times | ||
Earnings per share | $ | $ | ||||
Price-earnings ratio |
| times |
| times | ||
Payout ratio |
| % |
| % | ||
Debt to assets ratio |
| % |
| % |
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