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Measures of liquidity, Solvency, and Profitability The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $82.60
Measures of liquidity, Solvency, and Profitability
The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $82.60 on December 31, 20Y2.
Marshall Inc.
Comparative Retained Earnings Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2
20Y1
Retained earnings, January 1
$3,704,000
$3,264,000
Net income
600,000
550,000
Dividends:
On preferred stock
(10,000)
(10,000)
On common stock
(100,000)
(100,000)
Retained earnings, December 31
$4,194,000
$3,704,000
Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2
20Y1
Sales
$10,850,000
$10,000,000
Cost of merchandise sold
6,000,000
5,450,000
Gross profit
$4,850,000
$4,550,000
Selling expenses
$2,170,000
$2,000,000
Administrative expenses
1,627,500
1,500,000
Total operating expenses
$3,797,500
$3,500,000
Income from operations
$1,052,500
$1,050,000
Other revenue and expense:
Other revenue
99,500
20,000
Other expense (interest)
(132,000)
(120,000)
Income before income tax expense
$1,020,000
$950,000
Income tax expense
420,000
400,000
Net income
$600,000
$550,000
Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
20Y2
20Y1
Assets
Current assets:
Cash
$1,050,000
$ 950,000
Marketable securities
301,000
420,000
Accounts receivable (net)
585,000
500,000
Inventories
420,000
380,000
Prepaid expenses
108,000
20,000
Total current assets
$2,464,000
$2,270,000
Long-term investments
800,000
800,000
Property, plant, and equipment (net)
5,760,000
5,184,000
Total assets
$9,024,000
$8,254,000
Liabilities
Current liabilities
$880,000
$800,000
Long-term liabilities:
Mortgage note payable, 6%
$200,000
$0
Bonds payable, 4%
3,000,000
$3,000,000
Total long-term liabilities
$3,200,000
$3,000,000
Total liabilities
$4,080,000
$3,800,000
Stockholders' Equity
Preferred 4% stock, $5 par
$250,000
$250,000
Common stock, $5 par
500,000
500,000
Retained earnings
4,194,000
3,704,000
Total stockholders' equity
$4,944,000
$4,454,000
Total liabilities and stockholders' equity
$9,024,000
$8,254,000
Required:
Determine the following measures for 20Y2, rounding to one decimal place, except dollar amounts which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.
10. Times interest earned
fill in the blank
12. Return on total assets
fill in the blank
15. Earnings per share on common stock
$
fill in the blank
16. Price-earnings ratio
fill in the blank
17. Dividends per share of common stock
$
fill in the blank
18. Dividend yield
fill in the blank
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Financial Holding Company Audit Compliance And Risk Management
Authors: Anthony Ludovic Assassa
1st Edition
6206122727, 978-6206122722
