P13-2A The comparative statements of Lucille Company are presented here.

LUCILLE COMPANY

Income Statements

For the Years Ended December 31

2012 2011

Net sales $1,890,540 $1,750,500

Cost of goods sold 1,058,540 1,006,000

Gross profit 832,000 744,500

Selling and administrative expenses 500,000 479,000

Income from operations 332,000 265,500

Other expenses and losses

Interest expense 22,000 20,000

Income before income taxes 310,000 245,500

Income tax expense 92,000 73,000

Net income $ 218,000 $ 172,500

LUCILLE COMPANY

Balance Sheets

December 31

Assets 2012 2011

Current assets

Cash $ 60,100 $ 64,200

Short-term investments 74,000 50,000

Accounts receivable 117,800 102,800

Inventory 126,000 115,500

Total current assets 377,900 332,500

Plant assets (net) 649,000 520,300

Total assets $1,026,900 $852,800

Liabilities and Stockholders Equity

Current liabilities

Accounts payable $ 160,000 $145,400

Income taxes payable 43,500 42,000

Total current liabilities 203,500 187,400

Bonds payable 220,000 200,000

Total liabilities 423,500 387,400

Stockholders equity

Common stock ($5 par) 290,000 300,000

Retained earnings 313,400 165,400

Total stockholders equity 603,400 465,400

Total liabilities and stockholders equity $1,026,900 $852,800

All sales were on account. Net cash provided by operating activities for 2012 was $220,000.

Capital expenditures were $136,000, and cash dividends were $70,000.

Instructions

Compute the following ratios for 2012.

(a) Earnings per share. (h) Days in inventory.

(b) Return on common stockholders equity. (i) Times interest earned.

(c) Return on assets. (j) Asset turnover.

(d) Current ratio. (k) Debt to total assets.

(e) Receivables turnover. (l) Current cash debt coverage.

(f ) Average collection period. (m) Cash debt coverage.

(g) Inventory turnover. (n) Free cash flow