Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Golden Corporation declared and paid $4.000 of cash dividends during the current year ended December 31. Its financial statements also reported the following summarized data.

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Golden Corporation declared and paid $4.000 of cash dividends during the current year ended December 31. Its financial statements also reported the following summarized data. $230,00 130.000 100,000 63,300 58.400 600 Income statement Sales revenue cost of goods sold Gross profit Operating expenses Interest pense Income before Income taxes Income tax pense Net Income Balance Sheet Cash Accounts receivable (net) Inventory Property and equipment (net) 9.900 4.000 119.000 57,600 29.000 50,000 55.00 $141.600 $ 17,50 55,000 Current abilities Note payable long term Common stock (par 35 Additional paid in capital Retained earnings 59,00 28.000 45,000 48.000 $13e.ee 26,000 55,000 36.00e 6,000 7.ee $130, 80e 7,000 26.16 $161.600 Required: 1. Compute the gross profit percentage for the current and previous years. Are the current year results better, or worse, than those for the previous year? 2 Compute the net profit margin for the current and previous years. Are the current year results better, or worse, than those for the previous year? 3. Compute the earnings per share for the current and previous years. Are the current year results better, or worse, than those for the previous year? TIP: To calculate EPS, use the balance in Common Stock to determine the number of shares outstanding Common Stock equals the par value per share times the number of shares. 4. Stockholders' equity totaled $36,000 at the beginning of the previous year. Compute the return on equity (ROE) ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year? 5. Net property and equipment totaled $40,000 at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. Are the current year results better, or worse than those for the previous year? 6. Compute the debt-to-assets ratios for the current and previous years. Is debt providing financing for a larger or smaller proportion of the company's asset growth? 7. Compute the times interest earned ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year? 8. After Golden released its current year's financial statements, the company's stock was trading at $40. After the release of its previous year's financial statements, the company's stock price was $28 per share Compute the P/E ratios for both years. Does it appear that investors have become more or less) optimistic about Golden's future success? Complete this question by entering your answers in the tabs below. Required 1 Required 3 Required 2 Required 4 Required 5 Required 6 Required 8 Required 7 4-a. Stockholders' equity totaled $36,000 at the beginning of the previous year. Compute the return on equity (ROE) ratios for the current and previous years. (Round your answers to 1 decimal place.) 4-b. Are the current year results better, or worse, than those for the previous year? Return on Equity 642% Current Year Previous Year Current year return on equity ratio is Better OWorse 5-b. Are the current year results better, or worse, than those for the previous year? 5-a Fixed Asset Turnover Current Year Previous Year 5-b. Current year fixed asset turnover is: O Better O Worse Debt-to Assets Current Year Previous Year 6-b Current year debt-to-assets ratio is: Larger Proportion OSmaller Proportion the unles interest earned ratios for the current and previous years. (Round your answers to 1 decimal pla 7-b. Are the current year results better, or worse, than those for the previous year? Times Interest Earned Current Year Previous Year 7-b Current year times interest earned ratio is: O Better O Worse Show less Price Earnings Ratio Curent Year Previous Year Current year P/E ratio is More Optimistic Less Optimistic

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Environmental Auditing Fundamentals And Techniques

Authors: J. Ladd Greeno

2nd Edition

091509410X, 978-0915094103

More Books

Students also viewed these Accounting questions

Question

=+ (b) Define a set function v, on , by (11.6) "o (f, g] = A(g-f).

Answered: 1 week ago

Question

What are the functions of top management?

Answered: 1 week ago

Question

Bring out the limitations of planning.

Answered: 1 week ago

Question

Why should a business be socially responsible?

Answered: 1 week ago

Question

Discuss the general principles of management given by Henri Fayol

Answered: 1 week ago

Question

My opinions/suggestions are valued.

Answered: 1 week ago