Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 66 on December 31, 20Y2. Marshall
The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 66 on December 31, 20Y2.
Marshall Inc. | ||||||
Comparative Retained Earnings Statement | ||||||
For the Years Ended December 31, 20Y2 and 20Y1 | ||||||
20Y2 | 20Y1 | |||||
Retained earnings, January 1 | $2,435,700 | $2,053,700 | ||||
Net income | 547,200 | 420,600 | ||||
Dividends: | ||||||
On preferred stock | (9,100) | (9,100) | ||||
On common stock | (29,500) | (29,500) | ||||
Retained earnings, December 31 | $2,944,300 | $2,435,700 |
Marshall Inc. | ||||
Comparative Income Statement | ||||
For the Years Ended December 31, 20Y2 and 20Y1 | ||||
20Y2 | 20Y1 | |||
Sales | $3,093,740 | $2,850,440 | ||
Cost of merchandise sold | 1,165,080 | 1,071,870 | ||
Gross profit | $1,928,660 | $1,778,570 | ||
Selling expenses | $607,580 | $764,470 | ||
Administrative expenses | 517,570 | 448,970 | ||
Total operating expenses | $1,125,150 | $1,213,440 | ||
Income from operations | $803,510 | $565,130 | ||
Other revenue and expense: | ||||
Other revenue | 42,290 | 36,070 | ||
Other expense (interest) | (224,000) | (123,200) | ||
Income before income tax expense | $621,800 | $478,000 | ||
Income tax expense | 74,600 | 57,400 | ||
Net income | $547,200 | $420,600 |
Marshall Inc. | |||||||
Comparative Balance Sheet | |||||||
December 31, 20Y2 and 20Y1 | |||||||
20Y2 | 20Y1 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash | $573,910 | $523,710 | |||||
Marketable securities | 868,610 | 867,870 | |||||
Accounts receivable (net) | 613,200 | 576,700 | |||||
Inventories | 467,200 | 365,000 | |||||
Prepaid expenses | 108,577 | 104,740 | |||||
Total current assets | $2,631,497 | $2,438,020 | |||||
Long-term investments | 1,991,673 | 736,368 | |||||
Property, plant, and equipment (net) | 3,080,000 | 2,772,000 | |||||
Total assets | $7,703,170 | $5,946,388 | |||||
Liabilities | |||||||
Current liabilities | $848,870 | $860,688 | |||||
Long-term liabilities: | |||||||
Mortgage note payable, 8% | $1,260,000 | $0 | |||||
Bonds payable, 8% | 1,540,000 | 1,540,000 | |||||
Total long-term liabilities | $2,800,000 | $1,540,000 | |||||
Total liabilities | $3,648,870 | $2,400,688 | |||||
Stockholders' Equity | |||||||
Preferred $0.70 stock, $40 par | $520,000 | $520,000 | |||||
Common stock, $10 par | 590,000 | 590,000 | |||||
Retained earnings | 2,944,300 | 2,435,700 | |||||
Total stockholders' equity | $4,054,300 | $3,545,700 | |||||
Total liabilities and stockholders' equity | $7,703,170 | $5,946,388 |
Required:
Determine the following measures for 20Y2, rounding to one decimal place, except for dollar amounts, which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.
6. Inventory turnover | fill in the blank 6 | |
7. Number of days' sales in inventory | fill in the blank 7 | days |
8. Ratio of fixed assets to long-term liabilities | fill in the blank 8 | |
9. Ratio of liabilities to stockholders' equity | fill in the blank 9 | |
10. Times interest earned | fill in the blank 10 | |
11. Asset turnover | fill in the blank 11 | |
12. Return on total assets | fill in the blank 12 | % |
13. Return on stockholders equity | fill in the blank 13 | % |
14. Return on common stockholders equity | fill in the blank 14 | % |
15. Earnings per share on common stock | $fill in the blank 15 | |
16. Price-earnings ratio | fill in the blank 16 | |
17. Dividends per share of common stock | $fill in the blank 17 | |
18. Dividend yield |
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