Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hi This is the 3rd time I'm asking this question, please answer the whole question.... Thank you w www This Year Last Year $ 1,010,

Hi This is the 3rd time I'm asking this question, please answer the whole question.... Thank you

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

w www This Year Last Year $ 1,010, eee 2,988,eee 3,650,000 270, eee 7,838,800 9,620,000 $ 17,450, eee $ 1,250,00 300,000 2,eee, eee 2,000,000 210, eee 5,760,000 9, 180, eee $ 14,860,000 Assets Current assets: Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Note payable, 18% Total abilities Stockholders' equity: Connon stock, $70 par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 4,068,000 3,780, een 7,760,000 $ 3, e88,eee 3,180,000 6,188,eee 7,600,eee 2,690,eee 9,690, eee $ 17,458,eee 7,600,eee 1,680,000 8,680,000 $ 14,860,000 Lydex Company Comparative Income Statenent and Reconciliation This Year Last Year Sales (all on account) $ 15,918,888 $ 14,698.8ee Cost of goods sold 12,728,00 18,560.ece Gross margin 3,182.000 3,528.000 Selling and administrative expenses 912,000 1,624.ee Net operating income 2,270,000 1,896.ee Interest expense 378,888 318.000 Net income before taxes 1,988,888 1,586,eee Income taxes (30%) 579,082 475, see Net income 1,330,000 1,110,200 Connon dividends 320,000 555, 10e Net income retained 1,010,000 555, 10e Beginning retained earnings 1,688,888 1,124, see Ending retained earnings $ 2,690,000 $ 1,688,eee To begin your assignment you gather the following financial data and ratios that are typical of companies in Lydex Company's Industry Current ratio Acid-test ratio Average collection period Average sale period Return on assets Debt-to-equity ratio Tines interest earned ratio Price-earnings ratio 2.3 1.1 32 days 60 days 9.8% 0.7 5.8 18 Required: 1. You decide first to assess the company's performance in terms of debt management and profitability. Compute the following for both this year and last year: (Round your "Percentage" answers to 1 decimal place and other answers to 2 decimal places.) a. The times Interest earned ratio. b. The debt-to-equity ratio. c. The gross margin percentage d. The return on total assets. (Total assets at the beginning of last year were $13,120.000.) e. The return on equity. (Stockholders' equity at the beginning of last year totaled 88,24.900. There has been no change in common stock over the last two years.) f Is the company's financial leverage positive or negative? This Year Last Year a. The times interest eamed ratio b. The debt-to-equity ratio c. The gross margin percentage d. The return on total assets e. The return on equity f. Is the company's financial leverage positive or negative? % % % % 2. You decide next to assess the company's stock market performance. Assume that Lydex's stock price at the end of this year is $104 per share and that at the end of last year it was $72. For both this year and last year. compute: (Round your "Percentage" answers to 1 decimal place and other intermediate and final answers to 2 decimal places.) a. The earnings per share b. The dividend yield ratio. c. The dividend payout ratio. d. The price earnings ratio. e. The book value per share of common stock This Year Last Year a. The earnings per share b. The dividend yield ratio c. The dividend payout ratio d. The price-earnings ratio e. The book value per share of common stock % % % 9. 3. You decide, finally, to assess the company's liquidity and asset management. For both this year and last year, compute: a. Working capital b. The current ratio. (Round your final answers to 2 decimal places.) c. The acid-test ratio. (Round your final answers to 2 decimal places.) d. The average collection period. (The accounts recelvable at the beginning of last year totaled $1.720,000.) (Use 365 days in a year. Round your intermediate calculations and final answers to 2 decimal place.) e. The average sale period. (The Inventory at the beginning of last year totaled $2.080,000.) (Use 365 days in a year. Round your Intermediate calculations and final answers to 2 decimal place.) f. The operating cycle. (Round your intermediate calculations and final answers to 2 decimal place.) 9. The total asset turnover. (The total assets at the beginning of last year totaled $13.120.000. (Round your final answers to 2 decimal places.) This Year Last Year a. Working capital b. The current ratio c. The acid-test ratio d. The average collection period e. The average sale period f. The operating cycle g. The total asset turnover days days days days days days

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

Accounting

Authors: Charles T. Horngren, Walter T. Harrison, Linda S. Bamber, Betsy Willis, Becky Jones

5th Edition

0130906999, 978-0130906991

More Books

Students also viewed these Accounting questions

Question

plan and structure your literature review;

Answered: 1 week ago

Question

establish an effective note-taking and recording system;

Answered: 1 week ago

Question

identify what you need to read and where to find it;

Answered: 1 week ago