Problem 13-23A Ratio analysis LO 13-2, 13-3, 13-4, 13-5 The following financial statements apply to Campbell Company Year 4 Year 3 Revenues Net sales $210,600 $175,e00 Other revenues 8,100 5,500 Total revenues 218,700 180,500 Expenses Cost of goods sold Selling expenses General and administrative expenses 125,900 20,700 102,400 18,700 10,70e 1,900 9,700 Interest expense 1,900 Income tax expense 19,000 17,700 Total expenses 178, 200 150, 400 Net income 40,500 30,100 Assets Current assets Cash 4,100 6,800 Marketable securities 2,900 2,900 Accounts receivable 36,800 101,400 30,800 Inventories 94,000 Prepaid expenses 3,300 148,500 105,900 21,800 2,300 Total current assets 136,800 Plant and equipment (net) Intangibles 105,900 $276, 200 $242,700 Total assets Liabilities and Stockholders' Equity Liabilities Current liabilities Accounts payable 39,400 55,100 17,00e 56,400 Other 16,500 Total current liabilities 71,600 Bonds payable 65,600 66,600 122,e00 Total liabilities 138,200 Stockholders' equity Common stock (40,000 shares) 114,700 114,700 Retained earnings Total stockholders' equity (10, 200] 39,500 154, 200 104,500 $276, 200 $242,700 Total liabilities and stockholders' equity Required Calculate the following ratios for Year 3 and Year 4. Since Year 2 numbers are not presented do not use averages when calculating the ratios for Year 3. Instead, use the number presented on the Year 3 balance sheet a. Net margin. (Round your answers to 2 decimal places.) b. Return on investment. (Round your answers to 2 decimal places.) c. Return on equity. (Round your answers to 2 decimal places.) d. Earnings per share. (Round your answers to 2 decimal places.) e. Price-earnings ratio (market prices at the end of Year 3 and Year 4 were $6.06 and $4.92, respectively). (Round your intermediate calculations and final answers to 2 decimal places.) f. Book value per share of common stock. (Round your answers to 2 decimal places.) g. Times interest earned. Exclude extraordinary income in the calculation as they cannot be expected to recur and, therefore, will not be available to satisfy future interest payments. (Round your answers to 2 decimal places.) h. Working i. Current ratio. (Round your answers to 2 decimal places.) j. Quick (acid-test) ratio. (Round your answers to 2 decimal places.) k. Accounts receivable turnover. (Round your answers to 2 decimal places.) I.Inventory turnover. (Round your answers to 2 decimal places.) m. Debt-to-equity ratio. (Round your answers to 2 decimal places.) n. Debt-to-assets ratio. (Round your answers to the nearest whole percent.) al. Year 4 Year 3 5.20 % 5.81% Net margin a. 0.14 % 0.12 % b. Return on investment Return on equity 0.29% 0.26 % C. $ 0.75 d. Earnings per share 0.98 Price-earnings ratio Book value times 40,306.12 times e. f. times Interest earned times g. Working capital h. j. Current ratio Quick (acid-test) ratio Accounts receivable turnover j. k. times times Inventory turnover m. Debt-to-equity ratio times I. times % Debt-to-assets ratio n
