P13-4B

P13-4B Financial information for Bradford Company is presented here. nt BRADFORD COMPANY Balance Sheets December 31 2014 2013 $ 42,000 50,000 77,000 320,000 31,000 75,000 400,000 $995,000 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets $ 50,000 80,000 100,000 410,000 30,000 75,000 570,000 $1,315,000 Liabilities and Stockholders' Equity Notes Accounts payable Accrued liabilities Bonds payable, due 2014 Common stock, $5 par Retained earnings Total liabilities and stockholders' equity S 120,000 160,000 50,000 180,000 500,000 305,000 $1,315,000 25,000 90,000 50,000 payable 100,000 500,000 230,000 $995,000 BRADFORD COMPANY Income Statements For the Years Ended December 31 2014 Sales revenue Cost of goods sold Gross profit Operating expenses Net income $1,050,000 680,000 370,000 240,000 $ 130,000 2013 $940,000 635,000 305,000 215,000 $ 90,000 Additional information: 1. Inventory at the beginning of 2013 was $330,000. 2. Accounts receivable at the beginning of 2013 were $80,000 3. Total assets at the beginning of 2013 were $1,175,000. 4. No common stock transactions occurred during 2013 or 2014. 5. All sales were on account. Instructions (a) Indicate, by using ratios, the change in liquidity and profitability of the company from 2013 to 2014. (Note: Not all profitability ratios can be computed nor can cash-basis ratios be computed.) P13-4B Financial information for Bradford Company is presented here. nt BRADFORD COMPANY Balance Sheets December 31 2014 2013 $ 42,000 50,000 77,000 320,000 31,000 75,000 400,000 $995,000 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets $ 50,000 80,000 100,000 410,000 30,000 75,000 570,000 $1,315,000 Liabilities and Stockholders' Equity Notes Accounts payable Accrued liabilities Bonds payable, due 2014 Common stock, $5 par Retained earnings Total liabilities and stockholders' equity S 120,000 160,000 50,000 180,000 500,000 305,000 $1,315,000 25,000 90,000 50,000 payable 100,000 500,000 230,000 $995,000 BRADFORD COMPANY Income Statements For the Years Ended December 31 2014 Sales revenue Cost of goods sold Gross profit Operating expenses Net income $1,050,000 680,000 370,000 240,000 $ 130,000 2013 $940,000 635,000 305,000 215,000 $ 90,000 Additional information: 1. Inventory at the beginning of 2013 was $330,000. 2. Accounts receivable at the beginning of 2013 were $80,000 3. Total assets at the beginning of 2013 were $1,175,000. 4. No common stock transactions occurred during 2013 or 2014. 5. All sales were on account. Instructions (a) Indicate, by using ratios, the change in liquidity and profitability of the company from 2013 to 2014. (Note: Not all profitability ratios can be computed nor can cash-basis ratios be computed.)