Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Financial statements for Narstad Corporation appear below: Narstad Corporation Balance Sheet December 31, Year 2 and Year 1 (dollars in thousands) Current assets: Cash and
Financial statements for Narstad Corporation appear below: Narstad Corporation Balance Sheet December 31, Year 2 and Year 1 (dollars in thousands) Current assets: Cash and marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant & equipment, net Total assets Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Bonds payable Total liabilities Stockholders' equity: Common stock, $2 par Additional paid-in capital Year 2 Year 1 100 $ 100 220 190 190 180 10 20 520 490 1,940 1,940 $ 2,460 $ 2,430 $ 150 $ 150 90 70 100 150 340 370 310 300 650 670 180 180 330 330 Retained earnings 1,300 1,250 Total stockholders' equity 1,810 1,760 Total liabilities & stockholders' equity $ 2,460 $ 2,430 Narstad Corporation Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (all on account) Cost of goods sold Gross margin Selling and administrative expense Net operating income Interest expense Net income before taxes Income taxes (30%) Net income $ 1,770 1,230 540 210 330 30 300 90 $ 210 Narstad Corporation's debt-to-equity ratio at the end of Year 2 was closest to: Multiple Choice 0.50 0.17 0.36 0.19
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started