Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

This week you are required to complete 2 problems: Problems 3.1 and 3.2. You are provided two Excel templates to use. Problem 3.1 (Statement of

image text in transcribed
image text in transcribed
image text in transcribed
This week you are required to complete 2 problems: Problems 3.1 and 3.2. You are provided two Excel templates to use. Problem 3.1 (Statement of Cash Flows) (Readings: Chapter 16) The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9, and 20Y8, is as follows: Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $91,800 cash. d. The common stock was jssued for cash. e. There was a $141,680 credit to Retained Earnings for net income. f. There was a $102,000 debit to Retained Earnings for cash dividends declared. INSTRUCTIONS Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) operating activities. Please use the attached Excel template to create your answers. (Readings: Chapter 17) The comparative financial statements of Marshall Inc. are provided below. The market price of Marshall common stock was $82.60 on December 31, 20Y2. INSTRUCTIONS Using the template provided, determine the following measures for 20Y2, rounding to one decimal place, including percentages, except for per-share amounts: 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 stockholders' equity 13. Return on total assets 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 Please use the attached Excel template to create your answers. Marshall inc Comparative Retained Earnings statement For the Yean Ended December 31,20Y2 and 2 or 1 \begin{tabular}{|c|c|c|} \hline & 202 & 20YI \\ \hline Retained earningh, January 1 ........................... & $3,704,000 & $3,264,000 \\ \hline Net income & 600,000 & 550,000 \\ \hline \multicolumn{3}{|l|}{ Dividends: } \\ \hline On preferred stock................. & (10,000) & (10,000) \\ \hline On common stock ..................................................................... & (100,000) & (100,000) \\ \hline Retained earnings. December 31 ......................................................... & $4,194,000 & $3704,000 \\ \hline \end{tabular} Marshalline. Comparative income statement For the Years Ended December 31,202 and 20Y1 \begin{tabular}{|c|c|c|} \hline & 202 & 20Y1 \\ \hline Sales....................... & $10,850,000 & $10,000,000 \\ \hline Cost of merchiandise sold....... & 6,000,000 & $,450,000 \\ \hline Gross profit................................ & 5.4,850,000 & 5,4,550,000 \\ \hline Selling expenses.................... & $2,170,000 & $2,000,000 \\ \hline Sellingexpentses.....................Administrativeexpenses.......... & 1,627,500 & 1,500,000 \\ \hline & $3,797,500 & $3,500,000 \\ \hline Income from operations............ & 51,052,500 & $1,050,000 \\ \hline \multicolumn{3}{|l|}{Incomefromoperations............Otherrevenueandexpense:} \\ \hline Othet revenue.................. & 99,500 & 20,000 \\ \hline Other expense (interest).............. & (132,000) & (120,000) \\ \hline Income before income tax expense. & $1,020,000 & $950,000 \\ \hline Income tax expense........................... & 420,000 & 400,000 \\ \hline Incometaxexpense....Netincome................. & $600,000 & $550,000 \\ \hline \end{tabular} Marshallinc. Cemparative Balance Sheet December 31,20Y2 and 20Y1 Awet: Current assets: Cash. Marketable securities. Accounts receivable (net). Inventories. Prepaid expenses. Total current assets. Long-term investments. Property, plant, and equipmenk (net). Total assets. Current liabilities. Long-term liabilities: Mortgage note payable, 6% Bonds payable, 4% Total long-term liabilities. Total liablities. Stockholder' Equity Preferred 4% stock. 55 par. Common stock, 55 par... Retained eamings. Total stockholder's equity. Total liabilities and stockholders' equity. \begin{tabular}{|c|c|} \hline$1,0$0,000 & 5950,000 \\ \hline 301,000 & 420,000 \\ \hline 585,000 & 500,000 \\ \hline 420,000 & 380,000 \\ \hline 103,000 & 20,000 \\ \hline$2,464,000 & $2,270,000 \\ \hline 800,000 & 800,000 \\ \hline 5,760,000 & 5,184,000 \\ \hline 59,024,000 & $8,254,000 \\ \hline$600.000 & 5800,000 \\ \hline s 200,000 & s \\ \hline 3,000,000 & 3.000000 \\ \hline$3200,000 & 53,000,000 \\ \hline 54,080,000 & $3,000000 \\ \hline \$. 250,000 & \& 250,000 \\ \hline 500,000 & 500,000 \\ \hline 4,194,000 & 3.704,000 \\ \hline 54,944,000 & 58.5400054.454,000 \\ \hline$9,024,000 & 58,254,000 \\ \hline \end{tabular}

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

Horngrens Cost Accounting A Managerial Emphasis

Authors: Srikant Datar, Madhav Rajan

16th Global Edition

1292211547, 9781292211541

More Books

Students also viewed these Accounting questions