Question 9 of 10 The following financial information is for Oriole Company ORIOLE COMPANY Balance Sheets December 31 Assets 2022 2021 Cash $ 69,000 $ 65,000 55,000 40,000 Debt investments (short-term) Accounts receivable 109,000 89.000 239,000 168,000 Inventory Prepaid expenses 23,000 26,000 Land 129.000 129,000 Building and equipment (net) 264,000 186,000 Total assets $888,000 $703,000 Liabilities and Stockholders' Equity Notes payable $169,000 $109,000 Accounts payable 66,000 52,000 Accrued liabilities 42,000 42,000 Bonds payable, due 2025 251,000 170,000 Question 9 of 10 $169,000 $109,000 66,000 52.000 42.000 42.000 Liabilities and Stockholders' Equity Notes payable Accounts payable Accrued liabilities Bonds payable, due 2025 Common stock, $10 par Retained earnings Total liabilities and stockholders' equity 251,000 170,000 204.000 204,000 156,000 126,000 $888,000 $703,000 2021 ORIOLE COMPANY Income Statements For the Years Ended December 31 2022 Sales revenue $902.000 $800,000 Cost of goods sold 650,000 575,000 Gross profit 252,000 225,000 Operating expenses 191,000 165,000 Net income $61.000 $ 60000 ORIOLE COMPANY Income Statements For the Years Ended December 31 2022 2021 Sales revenue $902,000 $800,000 Cost of goods sold 650,000 575,000 Gross profit 252,000 225,000 Operating expenses 191,000 165,000 Net income $61,000 $ 60,000 Additional information: 1. 2. 3. Inventory at the beginning of 2021 was $115,000. Accounts receivable (net) at the beginning of 2021 were $89,000. Total assets at the beginning of 2021 were $633,000. No common stock transactions occurred during 2021 or 2022. All sales were on account. 4. 5. (21) Compute the liquidity and profitability ratios of Oriole Company for 2021 and 2022. (Round Curent ratio, Asset turnover and Earnings per share to 2 decimal places, es 15.50 and round all other answers to 1 decimal place, es. 15.5. Round % change to O decimal places, for eg. 1% and if % change is a decrease show the numbers as negative, es. -1% or (1969) 2021 2022 % Change LIQUIDITY 1.70 1.78 % Current ratio .1 :1 Accounts receivables turnover times times Inventory turnover times times 2021 2022 % Change PROFITABILITY Profit margin % % Asset turnover times times 2021 2022 % Change PROFITABILITY Profit margin % % Asset turnover times times Return on assets % % Earnings per share $ $ (b) Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to decimal places, eg. 15 and round all other answers to 1 decimal place, es. 15.5. Round % change to O decimal places, for es, 1% and if % change is a decrease show the numbers as negative, e.g. - 1% or (1%)) Situation 18.000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $54,000 1. Ratio Return on common stockholders' equity 2 All of the notes payable were paid in 2023. All other liabilities remained at their December 31. 2022 levels. Total assets on December 31, 2023. were 5903.000. Debt to assets ratio (b) Given below are three independent situations and a ratio that may be affected. For each situation compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to decimal places, s, 15 and round all other onswers to I decimal noce, es. 15.5. Round change to decimal places, for es 1 and if change is a decrease show the numbers as negative, s. -1% or (190) Ratio 1 Situation 18,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $54,000 All of the notes payable were paid in 2023. All other liabilities remained at their December 31.2022 levels. Total assets on December 31, 2023, were $903.000, The market price of common stock was $9 and $13 on December 31, 2022 and 2023, respectively Return on common stockholders equity Debt to assets ratio 2 3 Price-earnings ratio 2022 2023 % Change Return on common stockholders' equity % Debt to assets ratio % Ratio Situation 18.000 stares of common stock were sold at par on July 1, 2023. Net income for 2023 was $54,000 All of the notes payable were paid in 2023. All other liabilities remained at their December 31.2022 levels, Total assets on December 31, 2023, were $903,000 The market price of common stock win $9 and $13 on December 31, 2022 and 2023 respectively Return on common stockholders' equity Debt to assets ratio 2 Price earnings ratio 2022 2023 Change Return on common stockholders equity X Debt to assets ratio % % Price earnings ratio times times
