Need help on comparative income

Comparative Income Statement Use the following comparative income statement form to enter amounts you identify from the computations on the Liquidity and Solvency Measures part and on the Profitability Measures part. Compute any missing amounts and complete the horizontal analysis columns. Enter percentages as decimal amounts, rounded to one decimal place. When rounding, look only at the fiqure to the right of or Financial analysis that compares an item in a current statement with the same item in prior statemer enter 32.1% Comparative Income Statement For the Years Ended December 31, 20Y6 and 20Y5 Increase/(Decrease) 20Y6 205 Percentage Amount $ 13.6 % Sales $7,287,000 19 (3,444,000) Cost of goods sold % $ V% Gross profit $3,843,000 8,8 V% Selling expenses $(1,457,600) 25 12.3 Administrative expenses (1,242,000) (1,106,000) % $ 19.5 Total operating expenses $ $(2,563,600) % $ % $ $1,279,400 Operating income 5.3 (120,600) % Other expense (interest) Income before income tax expense $ X $1,158,800 % (181,980) Income tax expense 3.3 $ $ $976,820 -18 Net income Preferred stock, $10 par 487,500 Common stock, $5 par 1,250,000 Retained earnings 2,341,500 Total stockholders' equity $ 4,079,000 Total liabilities and stockholders' equity $ 6,609,000 Feedback Check My Work Profitability Measures Match each computation to one of the profitability measures in the table. Profitability Measures Computations $8,280,000 [($5,785,000 + $5,595,000) 2] Asset turnover ($801,420 $127,000) [($6,609,000 + $6,419,000) 2] Return on total assets $801,420 [$4,079,000 + $3,875,050) 2] Return on stockholders' equity ($801,420 $65,000) [($3,591,500 $3,447,840) 2] Return on common stockholders' equity ($801,420 -$65,000) 250,000 shares Earnings per share on common stock $35 $3.05 Price-earnings ratio $175,000 250,000 shares Dividends per share $0.70 $35 Dividend yield Balance Sheet December 31, 20Y6 Assets Current assets: Cash $823,000 329,000 Marketable securities 714,000 Accounts receivable (net) 1,072,000 Inventory Prepaid expenses 157,000 3,095,000 Total current assets Long-term investments 824,000 2,690,000 Property, plant, and equipment (net) 6,609,000 Total assets Liabilities 840,000 Current liabilities Long-term liabilities 1,690,000 2,530,000 Total liabilities Stockholders' Equity Preferred stock, $10 par 487,500 Common stock, $5 par 1,250,000 2.341.500 Retained earninas Mastery Problem: Financial Statement Analysis Liquidity and Solvency Measures Your friend, another accountant, has bet you that with your knowledge of accounting and just the computations for common analytical measures, you can figure out many aspects of a company's financial statements. You take the bet! Match each computation to one of the liquidity and solvency measures in the table. (Hint: Begin by looking for simple computations and identifying the amounts in those computations. Look for other measures that use those amounts.) Liquidity and Solvency Measures Computations $3,095,000 $840,000 Working capital $3,095,000 $840,000 Current ratio $1,866,000 $840,000 Quick ratio $8,280,000 [($714,000 + $740,000) 2] Accounts receivable turnover ($714,000$740,000) 2] ($8,280,000 365) Number of days' sales in receivables $4,100,000 [($1,072,000 + $1,100,000) 2] Inventory turnover Number of days' sales in inventory ($1,072,000 + $1,100,000) 2] ($4,100,000 365) $2,690,000 $1,690,000 Ratio of fixed assets to long-term liabilities $2,530,000 $4,079,000 Ratio of liabilities to stockholders' equity ($989,400 $127,000) $127,000 Times interest earned