P2-6A P2-6A Condensed balance sheet and income statement data for Sievert Corporation are presented here and on the next page. SIEVERT CORPORATION Balance Sheets December 31 Assets 2012 2011 Cash $ 28,000 $ 20,000 Receivables (net) 70,000 62,000 Other current assets 90,000 73,000 Long-term investments 62,000 60,000 Plant and equipment (net) 510,000 470,000 Total assets $760,000 $685,000 Liabilities and Stockholders? Equity Current liabilities $ 75,000 $ 70,000 Long-term debt 80,000 90,000 Common stock 330,000 300,000 Retained earnings 275,000 225,000 Total liabilities and stockholders? equity $760,000 $685,000 SIEVERT CORPORATION Income Statements For the Years Ended December 31 2012 2011 Sales $750,000 $680,000 Cost of goods sold 440,000 400,000 Operating expenses (including income taxes) 240,000 220,000 Net income $ 70,000 $ 60,000 Additional information: Cash from operating activities $82,000 $56,000 Cash used for capital expenditures $45,000 $38,000 Dividends paid $20,000 $15,000 Average number of shares outstanding 33,000 30,000 Instructions Compute these values and ratios for 2011 and 2012. (a) Earnings per share. (b) Working capital. (c) Current ratio. (d) Debt to total assets ratio. (e) Free cash flow. (f ) Based on the ratios calculated, discuss briefly the improvement or lack thereof in financial position and operating results from 2011 to 2012 of Sievert Corporation.

Complete the following problem sets in Ch. 2 & 13 of Financial Accounting: P2-6A P13-2A Chapter 2: P2-6A Condensed balance sheet and income statement data for Sievert Corporation are presented here and on the next page. SIEVERT CORPORATION Balance Sheets December 31 Assets 2012 Cash $ 28,000 Receivables (net) 70,000 Other current assets 90,000 2011 Long-term investments $ 20,000 62,000 73,000 62,000 60,000 Plant and equipment (net) 510,000 470,000 Total assets $760,000 $685,000 Current liabilities $ 75,000 $ 70,000 Long-term debt 80,000 Liabilities and Stockholders' Equity Common stock 330,000 Retained earnings 275,000 Total liabilities and stockholders' equity $760,000 SIEVERT CORPORATION 90,000 300,000 225,000 $685,000 Income Statements For the Years Ended December 31 2012 2011 Sales $750,000 $680,000 Cost of goods sold 440,000 400,000 Operating expenses (including income taxes) Net income 240,000 $ 70,000 220,000 $ 60,000 Additional information: Cash from operating activities Cash used for capital expenditures $82,000 $45,000 Dividends paid $20,000 Average number of shares outstanding 33,000 $56,000 $38,000 $15,000 30,000 Instructions Compute these values and ratios for 2011 and 2012. (a) Earnings per share. (b) Working capital. (c) Current ratio. (d) Debt to total assets ratio. (e) Free cash flow. (f ) Based on the ratios calculated, discuss briefly the improvement or lack thereof in financial position and operating results from 2011 to 2012 of Sievert Corporation. SOLUTION: P2-6A Chapter 13: P13-2A 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 Income before income taxes 310,000 Income tax expense 92,000 Net income $ 218,000 LUCILLE COMPANY 20,000 245,500 73,000 $ 172,500 Balance Sheets December 31 Assets 2012 2011 Current assets Cash $ 60,100 Short-term investments 74,000 Accounts receivable 117,800 102,800 Inventory 126,000 115,500 377,900 332,500 Plant assets (net) 649,000 520,300 Total assets $1,026,900 $852,800 $ 160,000 $145,400 Total current assets $ 64,200 50,000 Liabilities and Stockholders' Equity Current liabilities Accounts payable Income taxes payable 42,000 Total current liabilities 187,400 Bonds payable 200,000 Total liabilities 43,500 203,500 220,000 423,500 387,400 Stockholders' equity Common stock ($5 par) 300,000 Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $852,800 290,000 313,400 165,400 603,400 465,400 $1,026,900 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