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The comparative financial statements prepared at December 31, 2017, for Pinnacle Plus showed the following summarized data: The comparative financial statements prepared at December 31,

The comparative financial statements prepared at December 31, 2017, for Pinnacle Plus showed the following summarized data: image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

The comparative financial statements prepared at December 31, 2017, for Pinnacle Plus showed the following summarized data: 2017 2016 $113,000 $102,000 53,200 49,200 Income Statement Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Interest Expense Income before Income Tax Expense Income Tax Expense (30%) 59,800 36,900 4,300 52,800 33,900 4,300 18,600 5,580 14,600 4,380 Net Income $ 13,020 $ 10,220 Balance Sheet Cash Accounts Receivable, Net Inventory Property and equipment, Net $ 55,805 $ 17,030 40,000 33,500 26,500 41,000 101,000 111,000 Total Assets $223,305 $ 202,530 $ 53,855 $ 39,700 1,030 530 43,000 43,000 Accounts Payable Income Tax Payable Note Payable, Long-Term Total Liabilities Contributed Capital (9,150 shares) Retained Earningst 97,885 91,500 33,920 83,230 91,500 27,800 Total Liabilities and Shareholders' Equity $223,305 $ 202,530 One-half of all sales are on credit. During 2017, cash dividends amounting to $6,900 were declared and paid. Required: 1-a. Compute the gross profit percentage in 2017 and 2016. (Round your answers to 1 decimal place.) Gross Profit Percentage % 2017 2016 % 1-b. Is the trend going in the right direction? O Yes 2-a. Compute the net profit margin for 2017 and 2016. (Round your answers to 1 decimal place.) 2017 2016 Net Profit Margin % % 2-b. Is the trend going in the right direction? O Yes O No 3-a. Compute the earnings per share for 2017 and 2016. (Round your answers to 2 decimal places.) Earnings per Share 2017 2016 3-b. Does the trend look good or bad? Good O Bad 4-a. Shareholders' equity totalled $100,000 at the end of 2015. Compute the return on equity (ROE) ratios for 2017 and 2016. (Round your answers to 1 decimal place.) 2017 Return on Equity % % 2016 4-b. Is the trend going in the right direction? Yes No 5-a. Net property and equipment totalled $116,000 at the end of 2015. Compute the fixed asset turnover ratios for 2017 and 2016. (Round your answers to 2 decimal places.) Fixed Asset Turnover 2017 2016 5-b. Is the trend going in the right direction? O No Yes 6-a. Compute the debt-to-assets ratios for 2017 and 2016. (Round your answers to 2 decimal places.) Debt-to- Assets 2016 6-b. Is debt providing financing for a larger or smaller proportion of the company's asset growth? O Larger proportion OSmaller proportion 7-a. Compute the times interest earned ratios for 2017 and 2016. (Round your answers to 1 decimal place.) 2017 Times Interest Earned times times 2016 7-b. Does the outcome of ratio in 2017 appears to be good or bad for the company? O Good O Bad 8-a. After Pinnacle Plus released its 2017 financial statements, the company's shares were trading at $36.50. After the release of its 2016 financial statements, the company's share price was $30.50 per share. Compute the P/E ratios for both years. (Round intermediate calculations to 2 decimal places and final answers to 1 decimal place.) Price Earnings 2017 2016 8-b. Does it appear that investors have become more or less) optimistic about Pinnacle's future success? O Less optimistic O More optimistic

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