Question
The following financial statements apply to Harris Company: Year 2 Year 1 Revenues $ 220,400 $ 181,700 Expenses Cost of goods sold 124,500 101,400 Selling
The following financial statements apply to Harris Company:
Year 2 | Year 1 | ||||||
Revenues | $ | 220,400 | $ | 181,700 | |||
Expenses | |||||||
Cost of goods sold | 124,500 | 101,400 | |||||
Selling expenses | 20,800 | 18,800 | |||||
General and administrative expenses | 10,600 | 9,600 | |||||
Interest expense | 2,500 | 2,500 | |||||
Income tax expense | 19,300 | 16,200 | |||||
Total expenses | 177,700 | 148,500 | |||||
Net income | $ | 42,700 | $ | 33,200 | |||
Assets | |||||||
Current assets | |||||||
Cash | $ | 5,000 | $ | 6,400 | |||
Marketable securities | 2,200 | 2,200 | |||||
Accounts receivable | 36,500 | 31,800 | |||||
Inventories | 101,800 | 94,400 | |||||
Prepaid expenses | 3,700 | 2,700 | |||||
Total current assets | 149,200 | 137,500 | |||||
Plant and equipment (net) | 105,400 | 105,400 | |||||
Intangibles | 20,700 | 0 | |||||
Total assets | $ | 275,300 | $ | 242,900 | |||
Liabilities and Stockholders Equity | |||||||
Liabilities | |||||||
Current liabilities | |||||||
Accounts payable | $ | 39,900 | $ | 34,100 | |||
Other | 16,100 | 16,600 | |||||
Total current liabilities | 56,000 | 50,700 | |||||
Bonds payable | 64,500 | 65,500 | |||||
Total liabilities | 120,500 | 116,200 | |||||
Stockholders equity | |||||||
Common stock (41,000 shares) | 114,700 | 114,700 | |||||
Retained earnings | 40,100 | 12,000 | |||||
Total stockholders equity | 154,800 | 126,700 | |||||
Total liabilities and stockholders equity | $ | 275,300 | $ | 242,900 | |||
Required Calculate the following ratios for Year 1 and Year 2. Since opening balance numbers are not presented do not use averages when calculating the ratios for Year 1. Instead, use the number presented on the Year 1 balance sheet. a. Net margin. (Round your answers to 2 decimal places.) b. Return on investment. (Round your answers to 2 decimal places.) c. Return on equity. (Round your answers to 2 decimal places.) d. Earnings per share. (Round your answers to 2 decimal places.) e. Price-earnings ratio (market prices at the end of Year 1 and Year 2 were $6.07 and $4.84, respectively). (Round your intermediate calculations and final answers to 2 decimal places.) f. Book value per share of common stock. (Round your answers to 2 decimal places.) g. Times interest earned. (Round your answers to 2 decimal places.) h. Working capital. i. Current ratio. (Round your answers to 2 decimal places.) j. Quick (acid-test) ratio. (Round your answers to 2 decimal places.) k. Accounts receivable turnover. (Round your answers to 2 decimal places.) l. Inventory turnover. (Round your answers to 2 decimal places.) m. Debt-to-equity ratio. (Round your answers to 2 decimal places.) n. Debt-to-assets ratio. (Round your answers to the nearest whole percent.)
PLEASE READ: THIS IS ONE QUESTION. Please assist me with the INCORRECT ANSWERS ONLY. Thank you.
Year 2 Year 1 a. 19.37 % 18.27 % SIX b. 15.51 X % 30.34 % 00 21.37 X % C. 26.20 % d. $ 1.04 $ e. 6.00 times f. $ > $ 3.78 5.30 X times Netmargin Return on investment Return on equity Earnings per share Price-earnings ratio Book value per share of common stock Times interest earned Working capital Current ratio Quick (acid-test) ratio Accounts receivable turnover Inventory turnover Debt-to-equity ratio Debt-to-assets ratio 0.81 7.25 X times 3.09 2.63 X times 86,800 g. h. $ 93,200 $ > OS i. 2.66 2.71 i. 0.78 K. 6.45 times I. 1.27 times 0.80 5.32 X times 1.20 X times 0.92 48 % m. 0.78 n. 44 %Step by Step Solution
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