Hi, my question is we cannot figure out how to solve the balance sheet portion under common equity what is the ratio associated with that. No, it's not the 47.28 that for total liabilities and equity.

In the book question, 2 says to complete the 2010 table of financial ratios for Cranston? The parts that are highlighted in bright red we cannot figure out. Here is all the information please send me the formulas and solution.

Cranston 2009 Industry Averages 2010 2010 2008 Liquidity 2.10 1.28 1.48 1.10 0.82 0.87 0.39 0.25 0.37 0.25 0.51 0.43 13.04 20.84 19.00 22.35 34.83 35.00 Current ratio Quick ratio or acid ratio test Cash ratio Financial leverage ratios Debt ratio Times Interest earned Cash coverage Asset management Inventory turnover Days' sales in inventory Receivables turnover Days' sales in receivables Total asset turnover Profitability ratios Profit margin Return on total assets Return on equity 4.24 4.78 5.20 06.04 76.30 70.19 4.99 8.63 6.81 42.32 53.60 73.18 1.03 1.10 1.80 6.50% 7.20% 8.60% 6.67% 7.89% 15.48% 13.61% 13.78% 20.59% Market $ 1.46 $ 1.39 Earnings per share (EPS) Price/earnings (PE) Earnings growth rate Not meaningful 21.00 26.11 23.04 4.79% 1745% 18.00% PEG 5.45 1.32 Book value $10.69 $10.08 1.17 Not meaningful 4.26 Market/book 3.55 3.18 3. Use the common-size statements and the ratio analysis that you have prepared to comment on Cranston's: a. liquidity b. solvency c. asset management d. profitability e market performance Indicate whether the ratios are improving or deteriorating over the three-year period and whether they are better or worse than the 2010 industry averages. 4. Express Cranston's ROE in terms of the DuPont identity. Which ratios are contributing to Cranston's below-average ROE? 5. Based on your analyses in Questions through 4. why do you think Cranston's recent stock perfor- ScartiebtebyapamScanner B D E F Industry Averages 2010 Cranston 2009 2008 2010 Comments 1.41 0.90 1.28 0.82 1.48 0.87 0.37 2.1 1.1 Below Industry Average Below Industry Average Below Industry Average 0.29 0.25 0.39 0.52 0.51 0.43 0.25 20.44 19 13.04 22.35 20.84 34.83 oove Industry Average Below Industry Average Below Industry Average 32.49 35 4.32 5.2 . 1 #3.) Ratio Analysis 2 3 4 5 Liquidity 6 Current Ratio 7 Quick Ratio 8 Cash Ratio 9 Financial Leverage Ratios 10 Debt Ratio 11 Times Interest Earned 12 Cash Coverage 13 Asset Management 14 Inventory Turnover 15 Days' Sales in Inventory 16 Receivables Turnover 17 Days' Sales in Receivables 18 Total Asset Turnover 19 Profitability Ratios 20 Profit Margin 21 Return on Total Assets 22 Return on Equity 23 Market 24 Earnings per Share 25 Price/Earnings 26 Earnings Growth Rate 27 PEG 28 Book Value 29 Market/Book 4.78 76.3 84.57 5.24 4.24 86.04 4.99 73.18 1.03 8.63 70.19 6.81 53.6 Below Industry Average Above Industry Average Above Industry Average Above Industry Average Below Industry Average 42.32 69.64 1.09 1.1 1.8 7.37% 6.50% 8.02% 6.67% 16.75% 13.61% 7.20% 7.89% 13.78% 8.60% 15.48% 20.59% Strong Profit Margins. Below Industry Average Good results. Below Industry Average Good results. Below Industry Average $1.95 $1.46 16.92 26.11 4.79% 5.45 11.64 $10.69 2.83 3.55 $1.39 23.04 17.45% 1.32 $10.08 3.18 Not Meaningful 21 18.00% 1.17 Not Meaningful 4.26 Good earnings. Above industry standards Good earnings. Below industry standards Good earnings. Above industry standards Below Industry Standards 30 A E TI G I 4 D Income Statements 2010 2009 2008 100% 100% 100% 67.86% 67.83% 67.25% 32.14% 32.17% 32.75% 14.53% 14.93% 14.71% 6.53% 7.18% 7.25% 11.07% 10.06% 10.80% 0.54% 0.77% 0.52% 10.53% 9.28% 10.28% 3.16% 2.79% 3.08% 7.37% 6.50% 7.20% 5 Years 6 Sales 7 COGS 8 Gross Profit 9 SG&A 10 Depreciation 11 EBIT 12 Interest Expense 13 Earnings before taxes 14 Taxes 15 Net Income 16 17 18 #2.) 19 20 ASSETS 21 Current Assets 22 23 Cash and Cash Items 24 25 Accounts Receivable 26 27 Inventory 28 29 Total Current Assets 30 31 Net Fixed Assets 32 33 TOTAL ASSETS Balance Sheets 2010 2009 9.80% 8.84% 20.75% 20.57% 2008 LIABILITIES 2010 2009 2008 Current Liabilities Acccounts Payable 9.54% 9.23% 8.11% 9.38% Accrued Payables 9.86% 10.73% 7.63% Short-Term Debt 14.45% 15.73% 9.66% 12.72% Total Current Liabilities 33.85% 35.69% 25.40% Long-Term Debt 11.44% 10.38% 11.49% 15.42% Other Liabilities 6.87% 4.93% 5.84% Total Liabilities 52.16% 51.01% 42.73% 37.52% OWNER'S EQUITY Common Equity 20.15% 21.50% 62.48% Total Owner's Equity 47.84% 48.99% 57.27% TOTAL LIABILITIES & 100% OWNER'S EQUITY 100% 100% 100% 17.10% 16.40% 47.64% 45.82% 52.36% 54.18% 100% 100% 24 Income Statements Account Sales 2010 $3.784.00 52.7601.00 SIR $2.568.00 $1,216.00 SLO $1.0M.CO $400 $5.00 $ 27.00 $ 1,00 Cost of goods sold Gross profit (margin) Selling, general, and administrative expenses Depreciation EBIT Interest expense Earnings before taxes Taxes $ MIX) $ 419.00 $ 298.00 $ 110 $28.1.20 $ 20:50 $398 50 $ 1195 $ 297.30 $29.19 SRI $198.59 $ 278.95 $ 2011 Net income 2008 2010 2009 $ 204,00 $ 332.00 $288.00 $ 343.00 $ 335.00 $ 503.00 $ 491.00 $ 192.00 $ 243.00 $ 639.00 $289.00 Balance Sheets ASSETS 2010 2009 2008 LIABILITIES Current assets Current liabilities Accounts payable Cash $ 341.00 $ 276.00 $ 236.00 Accrued expenses Short-term debt Accounts receivable $ 722.00 $ 642.00 320.00 Total current liabilities Inventory $ 595.00 $ 512,00 S 388.00 Long-term debt Other liabilities Total current assets $1,658.00 $1.430,00 S 944.00 Total liabilities OWNERS' EQUITY et fixed assets $1.822.00 $1.691.00 $1,572.00 Common equity TOTAL LIABILITIES AND OWNERS OTAL ASSETS $3,480,00 $3,121.00 $2,516.00 EQUITY $1,178.00 $1,114.00 $ 398.00 S 324.00 $ 239.00 $ 154,00 $1.815.00 $1,592.00 $ 147.00 $1.075.000 $1.665.00 $1.529.(X) $1.441.00 $3,480.00 $3.121.00 $2,516,00 Additional Information Stock price per share Dividend per share Shares outstanding (millions) 2010 2009 2008 $33.00 $38.00 $32.00 $ 1.00 $ 0.84 $ 0.70 143 143 143 Scanned by Cam Scanner Cranston 2009 Industry Averages 2010 2010 2008 Liquidity 2.10 1.28 1.48 1.10 0.82 0.87 0.39 0.25 0.37 0.25 0.51 0.43 13.04 20.84 19.00 22.35 34.83 35.00 Current ratio Quick ratio or acid ratio test Cash ratio Financial leverage ratios Debt ratio Times Interest earned Cash coverage Asset management Inventory turnover Days' sales in inventory Receivables turnover Days' sales in receivables Total asset turnover Profitability ratios Profit margin Return on total assets Return on equity 4.24 4.78 5.20 06.04 76.30 70.19 4.99 8.63 6.81 42.32 53.60 73.18 1.03 1.10 1.80 6.50% 7.20% 8.60% 6.67% 7.89% 15.48% 13.61% 13.78% 20.59% Market $ 1.46 $ 1.39 Earnings per share (EPS) Price/earnings (PE) Earnings growth rate Not meaningful 21.00 26.11 23.04 4.79% 1745% 18.00% PEG 5.45 1.32 Book value $10.69 $10.08 1.17 Not meaningful 4.26 Market/book 3.55 3.18 3. Use the common-size statements and the ratio analysis that you have prepared to comment on Cranston's: a. liquidity b. solvency c. asset management d. profitability e market performance Indicate whether the ratios are improving or deteriorating over the three-year period and whether they are better or worse than the 2010 industry averages. 4. Express Cranston's ROE in terms of the DuPont identity. Which ratios are contributing to Cranston's below-average ROE? 5. Based on your analyses in Questions through 4. why do you think Cranston's recent stock perfor- ScartiebtebyapamScanner B D E F Industry Averages 2010 Cranston 2009 2008 2010 Comments 1.41 0.90 1.28 0.82 1.48 0.87 0.37 2.1 1.1 Below Industry Average Below Industry Average Below Industry Average 0.29 0.25 0.39 0.52 0.51 0.43 0.25 20.44 19 13.04 22.35 20.84 34.83 oove Industry Average Below Industry Average Below Industry Average 32.49 35 4.32 5.2 . 1 #3.) Ratio Analysis 2 3 4 5 Liquidity 6 Current Ratio 7 Quick Ratio 8 Cash Ratio 9 Financial Leverage Ratios 10 Debt Ratio 11 Times Interest Earned 12 Cash Coverage 13 Asset Management 14 Inventory Turnover 15 Days' Sales in Inventory 16 Receivables Turnover 17 Days' Sales in Receivables 18 Total Asset Turnover 19 Profitability Ratios 20 Profit Margin 21 Return on Total Assets 22 Return on Equity 23 Market 24 Earnings per Share 25 Price/Earnings 26 Earnings Growth Rate 27 PEG 28 Book Value 29 Market/Book 4.78 76.3 84.57 5.24 4.24 86.04 4.99 73.18 1.03 8.63 70.19 6.81 53.6 Below Industry Average Above Industry Average Above Industry Average Above Industry Average Below Industry Average 42.32 69.64 1.09 1.1 1.8 7.37% 6.50% 8.02% 6.67% 16.75% 13.61% 7.20% 7.89% 13.78% 8.60% 15.48% 20.59% Strong Profit Margins. Below Industry Average Good results. Below Industry Average Good results. Below Industry Average $1.95 $1.46 16.92 26.11 4.79% 5.45 11.64 $10.69 2.83 3.55 $1.39 23.04 17.45% 1.32 $10.08 3.18 Not Meaningful 21 18.00% 1.17 Not Meaningful 4.26 Good earnings. Above industry standards Good earnings. Below industry standards Good earnings. Above industry standards Below Industry Standards 30 A E TI G I 4 D Income Statements 2010 2009 2008 100% 100% 100% 67.86% 67.83% 67.25% 32.14% 32.17% 32.75% 14.53% 14.93% 14.71% 6.53% 7.18% 7.25% 11.07% 10.06% 10.80% 0.54% 0.77% 0.52% 10.53% 9.28% 10.28% 3.16% 2.79% 3.08% 7.37% 6.50% 7.20% 5 Years 6 Sales 7 COGS 8 Gross Profit 9 SG&A 10 Depreciation 11 EBIT 12 Interest Expense 13 Earnings before taxes 14 Taxes 15 Net Income 16 17 18 #2.) 19 20 ASSETS 21 Current Assets 22 23 Cash and Cash Items 24 25 Accounts Receivable 26 27 Inventory 28 29 Total Current Assets 30 31 Net Fixed Assets 32 33 TOTAL ASSETS Balance Sheets 2010 2009 9.80% 8.84% 20.75% 20.57% 2008 LIABILITIES 2010 2009 2008 Current Liabilities Acccounts Payable 9.54% 9.23% 8.11% 9.38% Accrued Payables 9.86% 10.73% 7.63% Short-Term Debt 14.45% 15.73% 9.66% 12.72% Total Current Liabilities 33.85% 35.69% 25.40% Long-Term Debt 11.44% 10.38% 11.49% 15.42% Other Liabilities 6.87% 4.93% 5.84% Total Liabilities 52.16% 51.01% 42.73% 37.52% OWNER'S EQUITY Common Equity 20.15% 21.50% 62.48% Total Owner's Equity 47.84% 48.99% 57.27% TOTAL LIABILITIES & 100% OWNER'S EQUITY 100% 100% 100% 17.10% 16.40% 47.64% 45.82% 52.36% 54.18% 100% 100% 24 Income Statements Account Sales 2010 $3.784.00 52.7601.00 SIR $2.568.00 $1,216.00 SLO $1.0M.CO $400 $5.00 $ 27.00 $ 1,00 Cost of goods sold Gross profit (margin) Selling, general, and administrative expenses Depreciation EBIT Interest expense Earnings before taxes Taxes $ MIX) $ 419.00 $ 298.00 $ 110 $28.1.20 $ 20:50 $398 50 $ 1195 $ 297.30 $29.19 SRI $198.59 $ 278.95 $ 2011 Net income 2008 2010 2009 $ 204,00 $ 332.00 $288.00 $ 343.00 $ 335.00 $ 503.00 $ 491.00 $ 192.00 $ 243.00 $ 639.00 $289.00 Balance Sheets ASSETS 2010 2009 2008 LIABILITIES Current assets Current liabilities Accounts payable Cash $ 341.00 $ 276.00 $ 236.00 Accrued expenses Short-term debt Accounts receivable $ 722.00 $ 642.00 320.00 Total current liabilities Inventory $ 595.00 $ 512,00 S 388.00 Long-term debt Other liabilities Total current assets $1,658.00 $1.430,00 S 944.00 Total liabilities OWNERS' EQUITY et fixed assets $1.822.00 $1.691.00 $1,572.00 Common equity TOTAL LIABILITIES AND OWNERS OTAL ASSETS $3,480,00 $3,121.00 $2,516.00 EQUITY $1,178.00 $1,114.00 $ 398.00 S 324.00 $ 239.00 $ 154,00 $1.815.00 $1,592.00 $ 147.00 $1.075.000 $1.665.00 $1.529.(X) $1.441.00 $3,480.00 $3.121.00 $2,516,00 Additional Information Stock price per share Dividend per share Shares outstanding (millions) 2010 2009 2008 $33.00 $38.00 $32.00 $ 1.00 $ 0.84 $ 0.70 143 143 143 Scanned by Cam Scanner