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 $82.80 on December 31, 20Y2. Marshall Inc.

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $82.80 on December 31, 20Y2.

Marshall Inc.

Comparative Retained Earnings Statement

For the Years Ended December 31, 20Y2 and 20Y1

1

20Y2

20Y1

2

Retained earnings, January 1

$3,692,000.00

$3,262,000.00

3

Net income

610,000.00

540,000.00

4

Total

$4,302,000.00

$3,802,000.00

5

Dividends:

6

On preferred stock

$10,000.00

$10,000.00

7

On common stock

100,000.00

100,000.00

8

Total dividends

$110,000.00

$110,000.00

9

Retained earnings, December 31

$4,192,000.00

$3,692,000.00

Marshall Inc.

Comparative Income Statement

For the Years Ended December 31, 20Y2 and 20Y1

1

20Y2

20Y1

2

Sales

$10,860,000.00

$10,000,000.00

3

Cost of goods sold

6,000,000.00

5,460,000.00

4

Gross profit

$4,860,000.00

$4,540,000.00

5

Selling expenses

$2,160,000.00

$2,000,000.00

6

Administrative expenses

1,627,500.00

1,500,000.00

7

Total operating expenses

$3,787,500.00

$3,500,000.00

8

Income from operations

$1,072,500.00

$1,040,000.00

9

Other revenue

99,500.00

20,000.00

10

$1,172,000.00

$1,060,000.00

11

Other expense (interest)

132,000.00

120,000.00

12

Income before income tax

$1,040,000.00

$940,000.00

13

Income tax expense

430,000.00

400,000.00

14

Net income

$610,000.00

$540,000.00

Marshall Inc.

Comparative Balance Sheet

December 31, 20Y2 and 20Y1

1

20Y2

20Y1

2

Assets

3

Current assets:

4

Cash

$1,050,000.00

$950,000.00

5

Marketable securities

301,000.00

420,000.00

6

Accounts receivable (net)

584,000.00

500,000.00

7

Inventories

430,000.00

380,000.00

8

Prepaid expenses

109,000.00

20,000.00

9

Total current assets

$2,474,000.00

$2,270,000.00

10

Long-term investments

800,000.00

800,000.00

11

Property, plant, and equipment (net)

5,750,000.00

5,184,000.00

12

Total assets

$9,024,000.00

$8,254,000.00

13

Liabilities

14

Current liabilities

$882,000.00

$812,000.00

15

Long-term liabilities:

16

Mortgage note payable, 6%,

$200,000.00

$0.00

17

Bonds payable, 4%,

3,000,000.00

3,000,000.00

18

Total long-term liabilities

$3,200,000.00

$3,000,000.00

19

Total liabilities

$4,082,000.00

$3,812,000.00

20

Stockholders Equity

21

Preferred 4% stock, $5 par

$250,000.00

$250,000.00

22

Common stock, $5 par

500,000.00

500,000.00

23

Retained earnings

4,192,000.00

3,692,000.00

24

Total stockholders equity

$4,942,000.00

$4,442,000.00

25

Total liabilities and stockholders equity

$9,024,000.00

$8,254,000.00

Determine the following measures for 20Y2 (round to one decimal place, including percentages, except for per-share amounts): Assume a 365-day year.

1. Working Capital $
2. Current ratio
3. Quick ratio
4. Accounts receivable turnover
5. Number of days' sales in receivables
6. Inventory turnover
7. Number of days sales in inventory
8. Ratio of fixed assets to long-term liabilities
9. Ratio of liabilities to stockholders equity
10. Times interest earned
11. Asset turnover
12. Return on total assets %
13. Return on stockholders equity %
14. Return on common stockholders equity %
15. Earnings per share on common stock $
16. Price-earnings ratio
17. Dividends per share of common stock $
18. Dividend yield %

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

Agile Governance And Audit An Overview For Auditors And Agile Teams

Authors: Christopher Wright

1st Edition

184928587X, 978-1849285872

More Books

Students also viewed these Accounting questions

Question

Which are non projected Teaching aids in advance learning system?

Answered: 1 week ago

Question

7. Understand the challenges of multilingualism.

Answered: 1 week ago

Question

5. Give examples of variations in contextual rules.

Answered: 1 week ago