Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The comparative financial statements for Prince Company are below: Year 2 Year 1 Income statement: Sales revenue $ 194,000 $ 168,000 Cost of goods sold
The comparative financial statements for Prince Company are below:
Year 2 | Year 1 | ||||||
Income statement: | |||||||
Sales revenue | $ | 194,000 | $ | 168,000 | |||
Cost of goods sold | 113,000 | 100,400 | |||||
Gross profit | 81,000 | 67,600 | |||||
Operating expenses and interest expense | 56,400 | 53,200 | |||||
Pretax income | 24,600 | 14,400 | |||||
Income tax | 8,400 | 4,200 | |||||
Net income | $ | 16,200 | $ | 10,200 | |||
Balance sheet: | |||||||
Cash | $ | 4,400 | $ | 7,200 | |||
Accounts receivable (net) | 14,200 | 18,200 | |||||
Inventory | 40,400 | 34,200 | |||||
Property and equipment (net) | 45,600 | 38,400 | |||||
Total assets | $ | 104,600 | $ | 98,000 | |||
Current liabilities (no interest) | $ | 16,200 | $ | 17,400 | |||
Long-term liabilities (10% interest) | 45,200 | 45,200 | |||||
Common stock ($5 par value, 6,080 shares outstanding)) | 30,400 | 30,200 | |||||
Retained earnings | 12,800 | 5,200 | |||||
Total liabilities and stockholders' equity | $ | 104,600 | $ | 98,000 | |||
|
Assume that the stock price per share is $30 and that dividends in the amount of $4.50 per share were paid during Year 2. Compute the following ratios: (Round your answers to 2 decimal places. Enter percentage answers rounded to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started