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Home Suppliers, Inc. This project will give you an opportunity to evaluate financial statements and to make decisions based on the information presented in the
Home Suppliers, Inc.
This project will give you an opportunity to evaluate financial statements and to make decisions based on the information presented in the financial statements of Home Suppliers, Inc.
Introduction
Home Suppliers, Inc. sells a variety of consumer products. Its comparative income statement and balance sheet for the years and are presented on the Req tabs The Retained Earnings balance on January was $ Also, Preferred Stockholder cash dividends of $ were paid each year, as was $ in dividends paid to Common Stockholders each year.
Required:
Prepare a horizontal and a vertical analysis of the comparative income statement and balance sheet.
Calculate the following ratios for each year:
The rate of return on net sales.
The rate of return on common stockholders equity. Preferred dividends are $ for both years. Remember that dividend requirements on preferred stock must be deducted from net income after taxes to obtain income available to common stockholders.
The earnings per share of common stock, assuming that the preferred stock is nonparticipating, noncumulative, and has no liquidation value. The number of outstanding shares of common stock remained constant at throughout all of and
The priceearnings ratio on common stock. The market values were $ in and $ in
The rate of return on total assets.
The ratio of stockholders equity to total liabilities.
The current ratio.
The acidtest ratio.
The merchandise inventory turnover. Inventory was $ at January
The accounts receivable turnover. Credit sales were $ for and $ for The beginning accounts receivable balance for was $
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