Pepper Company provided the incomplete financial statements shown below as well as the following additional information: a. All sales during the year were on account. b. There was no change in the number of shares of common stock outstanding during the year. c. The interest expense on the income statement relates to the bonds payable; the amount of bonds outstanding did not change during the year. d. Selected balances at the beginning of the current year were: Accounts receivable $ 270, 000 Inventory $ 360, 000 Total assets $ 1, 800, 000 e. Selected financial ratios computed from the statements below for the current year are: Earnings per share $ 2. 30 Debt-to-equity ratio 0. 875 Accounts receivable turnover 14.0 Current ratio 2.75 Return on total assets 18. 0% Times interest earned ratio 6.75 Acid-test ratio 1. 25 Inventory turnover 6.5Required: Compute the missing amounts on the company's financial statements. (Hint: What's the difference between the acid-test ratio current ratio?) (Do not round intermediate calculations.) Pepper Industries Income Statement For the Year Ended March 31 Sales 4,200,000 Cost of goods sold Gross margin Selling and administrative expenses Net operating income 540,000 Interest expense 80,000 Net income before taxes Income taxes (30%) Net incomePepper Industries Balance Sheet March 31 Current assets: Cash Accounts receivable, net Inventory 624,000 Total current assets 880,000 Plant and equipment, net Total assets Liabilities: Current liabilities 320,000 Bonds payable, 10% 800.000 Total liabilities Stockholders equity Common stock, $5 par value Retained earnings Total stockholders equity Total liabilities and stockholders' equityDue: Saturday, September 23, 2023, 12:00 PM In order to successfully complete this weekly discussion forum, you must post (AT A MINIMUM) one (1) VIDEO to this forum in which you discuss your progress with the FINANCIAL ANALYSIS PROJECT that will be due this week. Your thread should focus on significant findings, problems you encounter, and analysis of "WHY' the numbers are what they are.7:48 Financial Statement Analysis - A Guided Example Financial Ratios for Assessing Liquidity Selected financial information for Helmet Corporation, a merchandising company, for the fiscal year ending Helmet Corporation December 31 appear below. The Excerpts from Comparative Balance Sheet company did not issue any new (dollars In thousands) common stock during the year. A total This Year Last Year of 4,500,000 shares of common stock Current assets were outstanding. The interest rate on Cash S 2,000 $ 3,100 the bond payable was 10%, the income tax rate was 30%, and the dividend per Accounts receivable, net 14,650 12,900 share of common stock was $1.29. The Inventory 16,850 17,000 market value of the company's Prepaid expenses 4,000 3,500 common stock at the end of the year Total current assets $ 37,500 $ 36,500 was $37. All of the company's sales Current liabilities are on account. Accounts payable S 19,000$ 22,365 Accrued liabilities 2,870 2,530 Required: Compute the following Notes payable, short term 1,000 1,000 financial data and ratios for this year: 1. Working capital. Total current liabilities 22,870$ 25,895 2. Current ratio. 3. Acid-test ratio. Requirement 1: Compute working capital. Current assets $37,500 Current liabilities 22,870 Working capital $14,630 Requirement 2: Compute the current ratio. Current assets $37,500 Current ratio = Current liabilities $22,870 = 1.64 Requirement 3: Compute the acid-test ratio. Acid test ratio = Cash + Marketable securities + Accounts receivable Current liabilities $2,000 + $0 + $14,650 = 0.73 $22,870 Financial Ratios for Asset Management Selected financial information for Helmet Corporation Helmet Corporation, a Excerpts from Comparative Financial Statements merchandising company, for the fiscal year ending December 31 (dollars In thousands) appears on the right. All of the This Year Last Year company's sales are on account. Sales $ 101,000 $ 98,000 Required: Compute the following Cost of goods sold 37,875 36,750 financial data for this year: a robeson.mrooms3.net7:48 asse Robeson C... Financial Ratios for Debt Management Selected financial information for Helmet Corporation Helmet Corporation, a merchandising Excerpts from Comparative Financial Statements company, for the fiscal year ending (dollars In thousands) December 31 appear below. The This Year Last Year company did not issue any new common stock during the year. A total Total assets $ 118,500 $ 111,500 of 4,500,000 shares of common stock Total current liabilities 22,870 25,895 were outstanding. The interest rate Total liabilities 47,870 51,895 on the bond payable was 10%, the Total paid-in capital 11,500 11,500 income tax rate was 30%, and the Retained earnings 59,130 48,105 dividend per share of common stock Total stockholders' equity 70,630 59,605 was $1.29. The market value of the Total liabilities and stockholders' equity 118,500 111,500 company's common stock at the end of the year was $37. All of the Net operating income 26,125 26,250 company's sales are on account. Interest expense 2,090 2,100 Net income before taxes 24,035 24,150 Required: Compute the following Income taxes 7,210 7,245 financial ratios for this year: Net income 16,825 16,905 1. Times interest earned ratio. Dividends to common stockholders 5,800 5,800 2. Debt-to-equity ratio. Net income added to retained earnings 11,025 11,105 3. Equity multiplier. Requirement 1: Compute the times interest earned ratio. Earnings before Times interest earned = interest and taxes $26,125 Interest expense $2,090 = 12.5 Requirement 2: Compute the debt-to-equity ratio. Total liabilities $47,870 Debt - to - equity ratio = $70,630 = 0.68 Stockholders'equity Requirement 3: Compute the equity multiplier. Average total assets Equity multiplier = Average stockholders'equity ($118,500 + $111,500)/2 = 1.77 ($70,630 + $59,605)/2 Financial Ratios for Assessing Profitability Selected financial information for Helmet Corporation, a Helmet Corporation merchandising company, for the fiscal year ending December 31 Excerpts from Comparative Financial Statements appears on the right. The company (dollars In thousands) did not issue any new common stock during the year. A total of This Year Last Y E 4,500,000 shares of common stock Sales $ 101,000 $ 98,00 were outstanding. The interest rate on the bond payable was 10%, the Cost of goods sold 37,875 36,750 AA robeson.mrooms3.net C7:49 Financial Ratios for Assessing Profitability Selected financial information for Helmet Corporation, a Helmet Corporation merchandising company, for the fiscal year ending December 31 Excerpts from Comparative Financial Statements appears on the right. The company (dollars In thousands) did not issue any new common stock during the year. A total of This Year Last Year 4,500,000 shares of common stock Sales $ 101,000 $ 98,000 were outstanding. The interest rate on the bond payable was 10%, the Cost of goods sold 37,875 36,750 income tax rate was 30%, and the Gross margin 63,125 61,250 dividend per share of common stock was $1.29. The market value Net operating income 26,125 26,250 of the company's common stock at Interest expense 2,090 2,100 the end of the year was $37. All of the company's sales are on Net income before taxes 24,035 24,150 account. Income taxes 7,210 7,245 Required: Compute the following Net income 16,825 16,905 financial data for this year: Total assets 118,500 111,500 1. Gross margin percentage. 2. Net profit margin percentage. Total stockholders' equity 70,630 59,605 3. Return on total assets. [LO15- 4. Return on equity. Requirement 1: Compute gross margin percentage Gross margin $63,125 Gross margin percentage = Sales $101,000 = 62.5% Requirement 2: Compute net profit margin percentage. Net income $16,825 Net profit margin percentage = = 16.7% Sales $101,000 Requirement 3: Compute return on total assets. Net income + [Interest Return on total assets = expense x (1 - Tax rate)] _ $16,825+[$2,090 x(1-0.30)] = 15.9% Average total assets $115,000 Requirement 4: Compute return on equity. Net income $16,825 Return on equity = Average stockholders'equity $65,118 = 25.8% Financial Ratios for Assessing Market Performance Selected financial information for Helmet Corporation, a merchandising Helmet Corporation company, for the fiscal year ending Excerpts from Comparative Financial Statements December 31 appear below. The (dollars In thousands) company did not issue any new common stock during the year. A total of This year Last year 4,500,000 shares of common stock Net operating income $ 26,125 $ 26,250 were outstanding. The interest rate on Interest expense 2,090 2,100 the bond payable was 10%, the income Net income before taxes 24,035 tax rate was 30%, and the dividend per 24,150 share of common stock was $1.29. The Income taxes 7,210 7,245 market value of the company's common Net income 16,825 16,905 stock at the end of the year was $37. All Dividends to common stockholders 5,800 5,800 of the company's sales are on account. Net income added to retained earnings 11,025 11,105 Required: Compute the following Beginning retained earnings 48,105 37,000 financial data for this year: Ending retained earnings 59,130 48,10 1. Earnings per share. 70,630 59,60 2. Price-earnings ratio. Total stockholders' equity 3. Dividend payout ratio. Total liabilities and stockholders' equity 118,500 111,50 . Dividend yield ratio. 5. Book value per share. Requirement 1: Compute the earnings per share. E Net income $16,825 Earnings per share = A Anerane member of common 1 500 = $3.74 robeson.mrooms3.net7:49 Financial Ratios for Assessing Market Performance Selected financial information for Helmet Corporation, a merchandising Helmet Corporation company, for the fiscal year ending Excerpts from Comparative Financial Statements December 31 appear below. The (dollars In thousands) company did not issue any new common stock during the year. A total of This year Last year 4,500,000 shares of common stock Net operating income $ 26,125 $ 26,250 were outstanding. The interest rate on Interest expense 2,090 2,100 the bond payable was 10%, the income 24.035 24,150 tax rate was 30%, and the dividend per Net income before taxes share of common stock was $1.29. The Income taxes 7,210 7,245 market value of the company's common Net income 16.825 16,905 stock at the end of the year was $37. All Dividends to common stockholders 5,800 5,800 of the company's sales are on account. Net income added to retained earnings 11,025 11,105 Required: Compute the following Beginning retained earnings 48,105 37,000 financial data for this year: Ending retained earnings 59,130 48,105 1. Earnings per share 70,630 59,605 2. Price-earnings ratio Total stockholders' equity 3. Dividend payout ratio. Total liabilities and stockholders' equity 118,500 111,500 4. Dividend yield ratio 5. Book value per share. Requirement 1: Compute the earnings per share. Net income $16,825 Earnings per share - Average number of common = $3.74 4,500 shares outstanding Requirement 2: Compute the price-earnings ratio. Market price per share $37 Price - earnings ratio = = 9.89 Earnings per share $3.74 Requirement 3: Compute the dividend payout ratio. Dividend payout ratio = Dividends per share Earnings per share $1.29 = 34.49% $3.74 Requirement 4: Compute the dividend yield ratio. Dividends per share $1.29 Dividend yield ratio = = 3.49% Market price per share $37 Requirement 5: Compute the book value per share. Total stockholders' equity $70,630 Book value per share = = $15.70 Number of common shares 4,500 outstanding Graded Required Discussion Forum FORUM a robeson.mrooms3.net