Problem 16-15 (Algo) Comprehensive Ratio Analysis (L016-2, L016-3, L016-4, L016-5, L016-6) [The following information applies to the questions displayed below) You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: Last Year Lydex Company Comparative Balance Sheet This Year Assets Current assets Cash $ 880,000 Marketable securities 0 Accounts receivable, net 2,380,000 Inventory 3.520,000 Prepaid expenses 240.000 Total current assets 7,020,000 Plant and equipment, net 9,360,000 Total assets $16,380,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 3,930,000 Note payable, 10+ 3,620,000 Total liabilities 2.550.000 Stockholders' equity. Common stock, 575 par value 7,500,000 Retained earnings 1.330.000 Total stockholders' equity 8.000.000 Total liabilities and stockholders equity 516,380,000 $ 1,120,000 300,000 1,480,000 2,200,000 180.000 5,200,000 3,970.000 $14.250,000 $ 2,320,000 3.020,000 5.840.000 7,500,000 910.000 10.000 314,250,000 Lydex Company Comparative Income Statement and Reconciliation This Year Last Year Sales (all on account) $ 15,780,000 $ 12,780,000 Cost of goods sold 12,624,000 9,585,000 Gross margin 3,156,000 3,195,000 Selling and administrative expenses 1, 294,000 1,572,000 Net operating income 1,362,000 1,623,000 Interest expense 362,000 302.000 Net income before taxes 1,000,000 1,321,000 Income taxes (308) 300,000 396, 300 Net income 700,000 924,700 Common dividenda 280,000 462.350 Net income retained 420,000 462, JSO Beginning retained earning 910,000 447,650 Ending retained earnings $ 1,330,000 $ 910,000 To begin your assignment you gather the following financial data and ratios that are typical of companies in Lydex Company's industry: Current ratio Acid-test ratio Average collection period Average sale period Return on assets Debt-to-equity ratio Times interest earned ratio Price-earnings ratio 2.3 1.0 30 days 60 days 8.48 0.7 5.2 10 Problem 16-15 Part 2 (Algo) 2. You decide next to assess the company's stock market performance. Assume that Lydex's stock price at the end of this year is $78 per share and that at the end of last year it was $46. For both this year and last year, compute: (Round your "Percentage" answers to 1 decimal place and other intermediate and final answers to 2 decimal places.) a. The earnings per share. b. The dividend yield ratio. c. The dividend payout ratio. d. The price-earnings ratio. e. The book value per share of common stock. This Year Last Year % % a. The earnings per share b. The dividend yield ratio C. The dividend payout ratio d. The price-camnings ratio The book value por share of common stock % %
