Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following income statement and balance sheets for Worlds of Fun are provided: Worlds of Fun Income Statement For the year-ended December 31, 2021 Sales

image text in transcribed
image text in transcribed
image text in transcribed
The following income statement and balance sheets for Worlds of Fun are provided: Worlds of Fun Income Statement For the year-ended December 31, 2021 Sales revenue $2,519,800 Cost of goods sold 1,540,000 Gross profit 979,800 Expenses: Operating expenses 350,000 Depreciation expense 66,000 Loss on sale of land 4,800 Interest expense 22,000 Income tax expense 57,000 Total expenses 499,800 Net income $ 480,000 2020 Worlds of Fun Balance Sheet December 31 2021 Assets Current assets: Cash 124,000 Accounts receivable 91,000 Inventory 210,000 Prepaid rent 12,000 Long-term assets: Land 320,000 Equipment 380,000 Accumulated depreciation (74,000) Total assets $1,063,000 Liabilities and Stockholders' Equity $ 109,000 77,000 190,000 12,000 260,000 280,000 (42,000) $886,000 Worlds of Fun Balance Sheet December 31 2021 2020 Assets Current assets! Cash 124,000 $109,000 Accounts receivable 91,000 77,000 Inventory 210,000 190,000 Prepaid rent 12.000 12,000 Long-term assets: Land 320,000 260,000 Equipment 380,000 280,000 Accumulated depreciation (74,000) (42,000) Total assets $1,063,000 $886,000 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 52,000 $ 73,000 Interest payable 8,600 7,600 Income tax payable 15, 100 12,100 Long-term liabilities: Notes payable 420,000 320,000 Stockholders' equity: Common stock 300,000 300,000 Retained earnings 267,300 173,300 Total liabilities and equity $1,063,000 $886,000 Earnings per share for the year ended December 31, 2021, is $1.60. The closing stock price on December 31, 2021 $38.60. Calculate the following profitability ratios for 2021: (Do not round intermediate calculations. Round your answers decimal place.) Earnings per share for the year ended December 31, 2021, is $1.60. The closing stock price on December 31, 2021, is $38.60. Calculate the following profitability ratios for 2021 (Do not round Intermediate calculations. Round your answers to 1 decimal place.) 4 Profitability Ratios 1. Gross profit ratio 2. Return on assets 3. Profit margin 4. Asset tumover 5. Return on equity 6. Price-earnings ratio % % times % 5 6 times

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Corporate Finance

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

13th International Edition

1265533199, 978-1265533199

Students also viewed these Accounting questions