Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 57 on December 31, 20Y2. Marshall

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 57 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 $4,139,900 $3,502,400
Net income 960,000 717,300
Dividends:
On preferred stock (11,900) (11,900)
On common stock (67,900) (67,900)
Retained earnings, December 31 $5,020,100 $4,139,900

Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2 20Y1
Sales $6,568,175 $6,051,550
Cost of merchandise sold 2,201,680 2,025,550
Gross profit $4,366,495 $4,026,000
Selling expenses $1,564,350 $1,904,980
Administrative expenses 1,332,595 1,118,790
Total operating expenses $2,896,945 $3,023,770
Income from operations $1,469,550 $1,002,230
Other revenue and expense:
Other revenue 77,350 63,970
Other expense (interest) (456,000) (251,200)
Income before income tax expense $1,090,900 $815,000
Income tax expense 130,900 97,700
Net income $960,000 $717,300

Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
20Y2 20Y1
Assets
Current assets:
Cash $1,551,960 $927,030
Marketable securities 2,348,910 1,536,230
Accounts receivable (net) 1,146,100 1,080,400
Inventories 861,400 657,000
Prepaid expenses 293,604 185,410
Total current assets $6,201,974 $4,386,070
Long-term investments 1,322,236 155,667
Property, plant, and equipment (net) 6,840,000 6,156,000
Total assets $14,364,210 $10,697,737
Liabilities
Current liabilities $1,824,110 $1,597,837
Long-term liabilities:
Mortgage note payable, 8% $2,560,000 $0
Bonds payable, 8% 3,140,000 3,140,000
Total long-term liabilities $5,700,000 $3,140,000
Total liabilities $7,524,110 $4,737,837
Stockholders' Equity
Preferred $0.70 stock, $50 par $850,000 $850,000
Common stock, $10 par 970,000 970,000
Retained earnings 5,020,100 4,139,900
Total stockholders' equity $6,840,100 $5,959,900
Total liabilities and stockholders' equity $14,364,210 $10,697,737

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 fill in the blank 18 %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Routledge Companion To Fair Value In Accounting

Authors: Gilad Livne

1st Edition

0367656132, 9780367656133

More Books

Students also viewed these Accounting questions