Old MathJax webview

Old MathJax webview

The financial statements for Armstrong and Blair companies for the current year are summarized Armstrong Company Blair Company $ $ $ Statement of Financial Position Cash Accounts receivable (net) Inventory Property, plant, and equipment (net) other non-current assets Total assets Current liabilities Long-term debt (10%) Share capital Contributed surplus Retained earnings Total liabilities and shareholdersequity Statement of Earnings Sales revenue (1/3 on credit) Cost of sales Expenses (including interest and income tax) Net earnings 35,000 54,000 170,000 185,000 85,500 529,500 134,000 81,500 230,000 42,000 42,000 529,500 $ 30,000 43,000 42,500 420,000 340,000 $ 875,500 $ 52,500 76,000 554,000 132,000 61,000 $ 875,500 $ $ 600,000 (300,000) (216,000) 84,000 $ 960,000 (432,000) (384,000) $ 144,000 $ Selected data from the financial statements for the previous year follows: Accounts receivable (net) Inventory Long-term debt Other data: Share price year-end Income tax rate Armstrong Company 35,000 77,000 81,500 Blair Company $ 55,000 23,000 76,000 $ $ 18 30% 15 30% ve The financial statements for Armstrong and Blair companies for the current year are summarized Armstrong Company Blair Company $ 4 $ Statement of Financial Position Cash Accounts receivable (net) Inventory Property, plant, and equipment (net) Other non-current assets Total assets Current liabilities Long-term debt (10%) Share capital Contributed surplus Retained earnings Total liabilities and shareholders' equity Statement of Earnings Sales revenue (1/3 on credit) Cost of sales Expenses (including interest and income tax) Net earnings 35,000 54,000 170,000 185,000 85,500 529,500 134,000 81,500 230,000 42,000 42,000 529,500 $ 30,000 43,000 42,500 420,000 340,000 $ 875,500 $ 52,500 76,000 554,000 132,000 61,000 $ 875,500 $ $ ho $ 600,000 (300,000) (216,000) 84,000 $ 960,000 (432,000) (384,000) $ 144,000 $ Selected data from the financial statements for the previous year follows: Accounts receivable (net) Inventory Long-term debt Other data: Share price year-end Income tax rate Armstrong Company $ 35,000 77,000 81,500 Blair Company $ 55,000 23,000 76,000 $ 18 30% $ 15 30% Selected data from the financial statements for the previous year follows: Armstrong Blair Company Company $ 35,000 $ 55,000 77,000 23,000 81,500 76,000 Accounts receivable (net) Inventory Long-term debt Other data: Share price year-end Income tax rate Dividends declared and paid Shares Outstanding $ 2 $ 18 30% 48,000 15,000 $ 15 30% $300,000 50,000 The companies are in the same line of business and are direct competitors in a large metropolitan area. Both have bee approximately ten years, and each has had steady growth. The management of each has a different viewpoint in many Company is more conservative, and as its president said, "We avoid what we consider to be undue risk." Neither compa held. Armstrong Company has an annual audit by an independent auditor, but Blair Company does not. Required: 1. Complete a schedule that reflects a ratio analysis of each company. Use ending balances if average balances are not (Round intermediate calculations and final answers to 2 decimal places.) HINT: To calculate Current Ratio, you will need to first calculate the total Current Assets. Ratio Armstrong Company Blair Company Profitability ratios: Gross profit percentage % % Profit margin % % Earnings per share per share Asset turnover ratios: Fixed Asset tumover times times per share va F5 F $ prt sc F10 home 3 96 5 end F12 & insert 6 7 00 9 O E R ba