Question
Twenty metrics of liquidity, Solvency, and Profitability The comparative financial statements of Automotive Solutions Inc. are as follows. The market price of Automotive Solutions Inc.
Twenty metrics of liquidity, Solvency, and Profitability
The comparative financial statements of Automotive Solutions Inc. are as follows. The market price of Automotive Solutions Inc. common stock was $66 on December 31, 20Y8.
AUTOMOTIVE SOLUTIONS INC. Comparative Income Statement For the Years Ended December 31, 20Y8 and 20Y7 | ||||
20Y8 | 20Y7 | |||
Sales | $3,016,725 | $2,779,500 | ||
Cost of goods sold | (1,095,000) | (1,007,400) | ||
Gross profit | $1,921,725 | $1,772,100 | ||
Selling expenses | $(649,700) | $(792,250) | ||
Administrative expenses | (553,445) | (465,290) | ||
Total operating expenses | (1,203,145) | (1,257,540) | ||
Operating income | $718,580 | $514,560 | ||
Other revenue and expense: | ||||
Other income | 37,820 | 32,840 | ||
Other expense (interest) | (200,000) | (110,400) | ||
Income before income tax | $556,400 | $437,000 | ||
Income tax expense | (66,800) | (52,500) | ||
Net income | $489,600 | $384,500 |
AUTOMOTIVE SOLUTIONS INC. Comparative Statement of Stockholders Equity For the Years Ended December 31, 20Y8 and 20Y7 | ||||||||||||||||||
20Y8 | 20Y7 | |||||||||||||||||
Preferred Stock | Common Stock | Retained Earnings | Preferred Stock | Common Stock | Retained Earnings | |||||||||||||
Balances, Jan. 1 | $450,000 | $510,000 | $2,217,475 | $450,000 | $510,000 | $1,877,525 | ||||||||||||
Net income | 489,600 | 384,500 | ||||||||||||||||
Dividends: | ||||||||||||||||||
Preferred stock | (6,300) | (6,300) | ||||||||||||||||
Common stock | (38,250) | (38,250) | ||||||||||||||||
Balances, Dec. 31 | $450,000 | $510,000 | $2,662,525 | $450,000 | $510,000 | $2,217,475 |
AUTOMOTIVE SOLUTIONS INC. Comparative Balance Sheet December 31, 20Y8 and 20Y7 | |||||
Dec. 31, 20Y8 | Dec. 31, 20Y7 | ||||
Assets | |||||
Current assets: | |||||
Cash | $461,940 | $472,510 | |||
Temporary investments | 699,160 | 783,020 | |||
Accounts receivable (net) | 547,500 | 511,000 | |||
Inventories | 408,800 | 321,200 | |||
Prepaid expenses | 87,392 | 94,500 | |||
Total current assets | $2,204,792 | $2,182,230 | |||
Long-term investments | 1,678,006 | 440,282 | |||
Property, plant, and equipment (net) | 3,000,000 | 2,700,000 | |||
Total assets | $6,882,798 | $5,322,512 | |||
Liabilities | |||||
Current liabilities | $760,273 | $765,037 | |||
Long-term liabilities: | |||||
Mortgage note payable, 8%, due in 15 years | $1,120,000 | $0 | |||
Bonds payable, 8%, due in 20 years | 1,380,000 | 1,380,000 | |||
Total long-term liabilities | $2,500,000 | $1,380,000 | |||
Total liabilities | $3,260,273 | $2,145,037 | |||
Stockholders' Equity | |||||
Preferred $0.70 stock, $50 par | $450,000 | $450,000 | |||
Common stock, $10 par | 510,000 | 510,000 | |||
Retained earnings | 2,662,525 | 2,217,475 | |||
Total stockholders' equity | $3,622,525 | $3,177,475 | |||
Total liabilities and stockholders' equity | $6,882,798 | $5,322,512 |
Instructions:
Determine the following measures for 20Y8. Round ratio values to one decimal place and dollar amounts to the nearest cent. For number of days' sales in receivables and number of days' sales in inventory, round intermediate calculations to the nearest whole dollar and final amounts to one decimal place. Assume there are 365 days in the year.
I am missing 12-20. Thank you!
12. Times preferred dividends earned | fill in the blank 12 | times |
13. Asset turnover | fill in the blank 13 | |
14. Return on total assets | fill in the blank 14 | % |
15. Return on stockholders equity | fill in the blank 15 | % |
16. Return on common stockholders equity | fill in the blank 16 | % |
17. Earnings per share on common stock | $fill in the blank 17 | |
18. Price-earnings ratio | fill in the blank 18 | |
19. Dividends per share of common stock | $fill in the blank 19 | |
20. Dividend yield | fill in the blank 20 | % |
Feedback
11. Divide the sum of income before income tax plus interest expense by interest expense. 12. Divide net income by preferred dividends [Preferred stock par value x dividend per preferred share]. 13. Divide net sales by average property, plant & equipment, . Average PPE = (Beginning PPE + Ending PPE) 2 14. Divide the sum of net income plus interest expense by average total assets. Average total assets = (Beginning Total Assets + Ending Total Assets) 2 15. Divide net income by average stockholders equity. Average stockholders equity = (Beginning StockholdersEquity + Ending StockholdersEquity) 2 16. Divide net income minus preferred dividends [Preferred stock par value x dividend per preferred share] by average common stockholders equity. Common StockholdersEquity = Common Stock + Retained Earnings Average Common StockholdersEquity = (Beginning Common Stockholders equity + Ending Common StockholdersEquity) 2 17. Divide net income minus preferred dividends [Preferred stock par value x dividend per preferred share] by common shares outstanding (common stock par value). 18. Divide common market share price by common earnings per share (use answer from requirement 17). 19. Divide common dividends (from Statement of Stockholders Equity) by common shares outstanding (common stock par value). 20. Divide common dividends per share (use answer from requirement 19) by market share price.
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