Question
The comparative financial statements of Stargel Inc. are as follows. The market price of Stargel common stock was $119.70 on December 31, 20Y2. Stargel Inc.Comparative
The comparative financial statements of Stargel Inc. are as follows. The market price of Stargel common stock was $119.70 on December 31, 20Y2.
Stargel Inc.Comparative Retained Earnings StatementFor the Years Ended December 31, 20Y2 and 20Y1
20Y2 20Y1
Retained earnings, January 1 $5,375,000 $4,545,000
Net income $900,000 $925,000
Total $6,275,000 $5,470,000
Dividends:
Preferred stock dividends $45,000 $45,000
Common stock dividends $50,000 $50,000
Total dividends $95,000 $95,000
Retained earnings, December 31 $6,180,000 $5,375,000
Stargel Inc.Comparative Income StatementFor the Years Ended December 31, 20Y2 and 20Y1
20Y2 20Y1
Sales $10,000,000 $9,400,000
Cost of goods sold $5,350,000 $4,950,000
Gross profit $4,650,000 $4,450,000
Selling expenses $2,000,000 $1,880,000
Administrative expenses $1,500,000 $1,410,000
Total operating expenses $3,500,000 $3,290,000
Income from operations $1,150,000 $1,160,000
Other revenue $150,000 $140,000
$1,300,000 $1,300,000
Other expense (interest) $170,000 $150,000
Income before income tax $1,130,000 $1,150,000
Income tax expense $230,000 $225,000
Net income $900,000 $925,000
Stargel Inc.Comparative Balance SheetDecember 31, 20Y2 and 20Y1
20Y2 20Y1
Assets
Current assets:
Cash $500,000 $400,000
Marketable securities $1,010,000 $1,000,000
Accounts receivable (net) $740,000 $510,000
Inventories $1,190,000 $950,000
Prepaid expenses $250,000 $229,000
Total current assets $3,690,000 $3,089,000
Long-term investments $2,350,000 $2,300,000
Property, plant, and equipment (net) $3,740,000 $3,366,000
Total assets $9,780,000 $8,755,000
Liabilities
Current liabilities $900,000 $880,000
Long-term liabilities:
Mortgage note payable, 10%. $200,000 $0
Bonds payable, 10% $1,500,000 $1,500,000
Total long-term liabilities $1,700,000 $1,500,000
Total liabilities $2,600,000 $2,380,000
Stockholders' Equity
Preferred $0.90 stock, $10 par $500,000 $500,000
Common stock, $5 par $500,000 $500,000
Retained earnings $6,180,000 $5,375,000
Total stockholders' equity $7,180,000 $6,375,000
Total liabilities and stockholders' equity $9,780,000 $8,755,000
Determine the following measures for 20Y2, rounding to one decimal place, except 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.
1.Working capital $
2.Current ratio
3.Quick ratio
4.Accounts receivable turnover
5.Number of days' sales in receivables days
6.Inventory turnover
7.Number of days' sales in inventory days
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 shareof common stock $
18.Dividend yield %
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