Homework Answers
1. Current ratio = Current Assets/ Current Liabilities
Considering the fact that above stated current assets in balance sheet doesn't include Cash, Accounts receivables and inventory. So, further calculation for the current asset will be: Cash+Accounts receivables+Inventory+Current Assets and total of current liabilities will be: Accounts payable+Notes payables+current liabilities
For 2019: Current Assets= 100,000+1,500,000+1,100,000+2,700,000= 5,400,000
For 2018: Current Assets= 80,000+1,200,000+970,000+2,250,000= 4,500,000
For 2019: Current Liabilities= 150,000+650,000+800,000=1,600,000
For 2018: Current Liabilities= 100,000+500,000+600,000=1,200,000
Current Ratio (2018)= 4,500,000/1,200,000= 3.75
Current Ratio (2019)=5,400,000/1,600,000=3.375
2. Quick Ratio: It is the ratio calculated by using current assets and reducing Inventory and prepaids.
For 2018: Quick Assets = Total current assets- inventory = 4,500,000- 970,000= 3,530,000
For 2019: Quick Assets= Total current assets- inventory = 5,400,000- 1,100,000= 4,300,000
Quick Ratio (2018)= 3,530,000/1,200,000=2.94
Quick Ratio (2019)= 4,300,000/1,600,000=2.68
3. Inventory turnover ratio: Cost of goods sold/ Average inventory
2018: Cost of Goods sold= 7,800,000
2019: Cost of Goods sold= 9,750,000
Average inventory= (1,100,000+970,000)/2= 1,035,000
Inventory turnover ratio (2018)= 7,800,000/1,035,000= 7.536
Inventory turnover ratio (2019)= 9,750,000/1,035,000= 9.420
4. Days sales outstanding= (Accounts receivables/Net credit sales)*365
Assuming all sales to be credit sales
2018: (1,500,000/15,000,000)*365 = 36.5
2019: (1,200,000/12,000,000)*365= 36.5
5. Total Asset turnover= Net Sales/Average total sales
Average total assets= (3,600,000+3,000,000)/2=3,300,000
2018: 12,000,000/3,300,000= 3.63
2019: 15,000,000/3,300,000=4.54
6.Debt Ratio: Total Liabilities/Total Assets
2018: 1,600,000/3,000,000= 0.533
2019: 2,000,000/3,600,000= 0.555
7. Liabilities to assets ratio: (Short term liabilities+Long term liabilities)/ Total assets
2018: 1,000,000/3,000,000=0.333
2019: 1,200,000/3,600,000=0.333
8. Times interest earned: EBIT/ Total Interest Expense
2018:1,300,000/300,000= 4.33
2019:1,750,000/500,000= 3.5
9. Profit Margin: Considering it to be net profit margin instead of gross profit margin or operating profit margin hence net profit margin formula: (Revenue-cost of good sold-operating expenses-other expenses-interest-taxes)/Revenue *100
2018: ((12,000,000-7,800,000-2,500,000-300,000-250,000)/12,000,000)*100= 6.02%
2019: ((15,000,000-9,750,000-3,000,000-500,000-312,500)/15,000,000)*100= 9.58%
10. Return on Assets: Net income/Average assets
Net income being Earning after taxes
2018: 750,000/3,300,000= 0.22
2019:937,500/3,300,000= 0.28
11. Return on Equity: Net income/Shareholders equity
2018: 750,000/1,400,000= 0.535
2018: 973,500/1,600,000= 0.585
12. Equity multiplier: Total Assets/ Total Shareholders equity
2018: 3,000,000/1,400,000= 2.142
2019: 3,600,000/1,600,000= 2.25
13. Du pont ROE
ROE: (Net income/sales)*(Sales/total assets)*(Total assets/shareholders equity)
2018: (750,000/12,000,000)*(12,000,000/3,000,000)*(3,000,000/1,400,000)=0.0625*4*2.14= 0.535
2019: (937,500/15,000,000)*(15,000,000/3,600,000)*(3,600,000/1,600,000)=0.0625*4.166*2.25=0.585
ANALYSIS:
Average industry ratio of current ratio is 4 while quick ratio is 2 and for the two complete years we have calculated and we can see that current ratio is below market standard which means that cash flow and supplier agreement for payment time is not timely made and hence the ratio is below standard where as quick ratio is above market standard and dictates a positive and it says that we are in a situation to meet our short term obligations on time.
Efficiency ratio indicates the company's ability to use its assets and manage all its liabilities all over the year. As per calcuation we are in a positive side for inventory turnover which means that we will be able to make payments on time and no problem will arise in future. Same is for days outstanding ratio which is 30 days as per market standards but we are able to convert inventory into cash in 36.5 days and which takes more time than market standards so this needs to be taken care of in company.
Leverage ratio: A higher ratio indicates that company is using debt to finance its assets and operations market standard is of 50% and we are maintaing 53.3% which is more than market.
Add Answer to:
II. Problem Solving. Show all the necessary computations. No solutions, no credit. Round off final answers...
Just need help with cash flows from operating activities! The comparative balance sheet of Livers Inc....
Just need help with cash flows from operating activities!
The comparative balance sheet of Livers Inc. or December 31, 20Y3 and 20Y2, s as follows: Dec. 31, 20Y3 Dec.31,20Y2 1 Assets 2 $155,000.00 $150,000.00 3 Cash Accounts receivable (net) 450,000.00 400,000.00 4 770,000.00 5 Inventories 750,000.00 0.00 100,000.00 6 Investments 0.00 7Land 500,000.00 8 Equipment 1,400,000.00 1,200,000.00 9 Accumulated depreciation-equipment (600,000.00) (500,000.00) $2,675,000.00 $2,100,000.00 10 Total assets Liabilities and Stockholders' Equity 11 $340,000.00 $300,000.00 12 Accounts payable (merchandise creditors) 50,000.00...
Please show all work. 1. Statement of Cash Flows and Standardized Financial Statements a) Net income...
Please show all work. 1. Statement of Cash Flows and Standardized Financial Statements a) Net income for your firm was $10,000 last year. The depreciation expense was $2,500; accounts receivable increased $1,250; accounts payable increased $800; and inventories increased by $2,000. Identify the sources and uses of cash • What was the total cash flow from operations for the period? Operating activities = Net Income + Depreciation + Source (inflow) - Use foutflow) b) i) Prepare the 2018 common-size Income...
Financial statements and necessary information is above. Find the following financial ratios for Somolira Golf(use year-end...
Financial statements and necessary information is above.
Find the following financial ratios for Somolira Golf(use
year-end figures rather than average values where appropriate): (Do
not round internediate calculations and tound your answer to 2
decimal places e.g., 32.16. Enter the profitability ratios as a
percent.
Some recent financial statements for Smolira Golf, Inc., follow. points eBook SMOLIRA GOLF, INC. Balance Sheets as of December 31, 2018 and 2019 2018 2019 2018 2019 Assets Liabilities and Owners' Equity Current assets Current...
Statement of cash flows-direct method applied to PR 13-1A Instructions Labels and Amount Descriptions Statement of...
Statement of cash flows-direct method applied to PR 13-1A Instructions Labels and Amount Descriptions Statement of Cash Flows Instructions Dec. 31, 2043 Dec. 31,2072 Assets Cash $155,000.00 $150,000.00 Accounts receivable (net) 450,000.00 400,000.00 Inventories 770,000.00 750,000.00 100,000.00 Investments 0.00 7 Land 500,000.00 0.00 8 Equipment 1,400,000.00 9 Accumulated depreciation equipment (600,000.00) $2,675,000.00 1,200,000.00 (500,000.00) $2,100,000.00 10 Total assets Liabilities and Stockholders' Equity 12 Accounts payable (merchandise creditors) $340,000.00 $300,000.00 Accrued expenses payable (operating expenses) 50,000.00 45,000.00 30,000.00 14 Dividends payable...
Write a narrative of up to 750 words in which you describe the following trends in...
Write a narrative of up to 750 words in which you describe the
following trends in the below images related to the income
statement, balance sheet and financial ratios. Identify what you
believe to be the most significant changes. The assignment is
completed by simply describing the changes. As an option, you may
speculate as to the causes of the changes.
wwc Balance Sheet wwc Retained Earnings Horizontal Analysis Increase or (Decrease) 2018 over 2017 Dollars Percent Vertical Analysis Percent...
Please show all work: Perform a DuPont Analysis
Consider the following financial statements for Green Valley Nursing Home, Inc., a for-profit, long-termcare facility:Green Valley Nursing Home, Inc.Statement of Income and Retained EarningsYear Ended December 31, 2XXXRevenue:Net patient service revenue $3,163,258Other revenue $106,146Total revenues $3,269,404Expenses:Salaries and benefits $1,515,438Medical supplies and drugs $966,781Insurance and other $296,357Provision for bad debts $110,000Depreciation $85,000Interest $206,780Total expenses $3,180,356Operating income $89,048Provision for income taxes $31,167Net income $57,881Retained earnings, beginning of year $199,961Retained earnings, end of year $257,842Green Valley Nursing Home, Inc.Balance SheetYear Ended December 31,...
(use 365 days a year. Round your intermediate calculations and final answers to 1 decimal place.)...
(use 365 days a year. Round your intermediate calculations and
final answers to 1 decimal place.)
Problem 12-4A Calculate risk ratios (L012-3) The following income statement and balance sheets for Virtual Gaming Systems are provided. VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2018 Net sales Cost of goods sold $3,066,000 1,956,000 1.110,000 Gross profit Expenses Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense $864.000 30,000 8,600 18,000 54,000 Total expenses...
Problem 3-13 Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Co...
Problem 3-13 Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of December 31, 2016 (Thousands of Dollars) Cash $ 225,000 Accounts payable $601,866 Receivables 1,575,000 Notes payable 326,634 Inventories 1,125,000 Other current liabilities 525,000 Total current assets $2,925,000 Total current liabilities $1,453,500 Net fixed assets 1,350,000 Long-term debt 1,068,750 Common equity 1,752,750 Total assets $4,275,000 Total liabilities and equity $4,275,000 Lozano Chip Company: Income Statement for Year Ended December...
Use the following information to answer the question below: note all sales are credit sales. Compute...
Use the following information to answer the question
below: note all sales are credit sales.
Compute each of the following ratios for 2018 and 2019
and indicate whether each ratio was getting "better" or "worse"
from 2018 to 2019 and was "good" or "bad" compared to the industry
Avg. 2019 (round all numbers to 2 digits past the decimal
place).
Income Stmt info: 2018 2019 Sales $ 1,000,000 $ 1,050,000 less Cost of Goods Sold: - 400,000 _ 432.000 Gross...
Assets Current assets Cash Accounts receivable Inventory FUT VUUS) 2018 2019 2018 2019 Liabilities and Owners'...
Assets Current assets Cash Accounts receivable Inventory FUT VUUS) 2018 2019 2018 2019 Liabilities and Owners' Equity Current liabilities $ 100 $ 115 Accounts payable $ 75 $ 105 170 150 Notes payable 100 120 120 120 Total $ 390 $ 385 Total $ 175 $ 225 $ 250 $ 290 Long-term debt Owners' equity Common stock Accumulated retained earnings 122 $ 190 $ 275 Fixed assets 348 Net plant and equipment $ 500 $ 600 Total Equity $ 465...
Just need help with cash flows from operating activities!
The comparative balance sheet of Livers Inc. or December 31, 20Y3 and 20Y2, s as follows: Dec. 31, 20Y3 Dec.31,20Y2 1 Assets 2 $155,000.00 $150,000.00 3 Cash Accounts receivable (net) 450,000.00 400,000.00 4 770,000.00 5 Inventories 750,000.00 0.00 100,000.00 6 Investments 0.00 7Land 500,000.00 8 Equipment 1,400,000.00 1,200,000.00 9 Accumulated depreciation-equipment (600,000.00) (500,000.00) $2,675,000.00 $2,100,000.00 10 Total assets Liabilities and Stockholders' Equity 11 $340,000.00 $300,000.00 12 Accounts payable (merchandise creditors) 50,000.00...
Please show all work. 1. Statement of Cash Flows and Standardized Financial Statements a) Net income for your firm was $10,000 last year. The depreciation expense was $2,500; accounts receivable increased $1,250; accounts payable increased $800; and inventories increased by $2,000. Identify the sources and uses of cash • What was the total cash flow from operations for the period? Operating activities = Net Income + Depreciation + Source (inflow) - Use foutflow) b) i) Prepare the 2018 common-size Income...
Financial statements and necessary information is above.
Find the following financial ratios for Somolira Golf(use
year-end figures rather than average values where appropriate): (Do
not round internediate calculations and tound your answer to 2
decimal places e.g., 32.16. Enter the profitability ratios as a
percent.
Some recent financial statements for Smolira Golf, Inc., follow. points eBook SMOLIRA GOLF, INC. Balance Sheets as of December 31, 2018 and 2019 2018 2019 2018 2019 Assets Liabilities and Owners' Equity Current assets Current...
Statement of cash flows-direct method applied to PR 13-1A Instructions Labels and Amount Descriptions Statement of Cash Flows Instructions Dec. 31, 2043 Dec. 31,2072 Assets Cash $155,000.00 $150,000.00 Accounts receivable (net) 450,000.00 400,000.00 Inventories 770,000.00 750,000.00 100,000.00 Investments 0.00 7 Land 500,000.00 0.00 8 Equipment 1,400,000.00 9 Accumulated depreciation equipment (600,000.00) $2,675,000.00 1,200,000.00 (500,000.00) $2,100,000.00 10 Total assets Liabilities and Stockholders' Equity 12 Accounts payable (merchandise creditors) $340,000.00 $300,000.00 Accrued expenses payable (operating expenses) 50,000.00 45,000.00 30,000.00 14 Dividends payable...
Write a narrative of up to 750 words in which you describe the
following trends in the below images related to the income
statement, balance sheet and financial ratios. Identify what you
believe to be the most significant changes. The assignment is
completed by simply describing the changes. As an option, you may
speculate as to the causes of the changes.
wwc Balance Sheet wwc Retained Earnings Horizontal Analysis Increase or (Decrease) 2018 over 2017 Dollars Percent Vertical Analysis Percent...
(use 365 days a year. Round your intermediate calculations and
final answers to 1 decimal place.)
Problem 12-4A Calculate risk ratios (L012-3) The following income statement and balance sheets for Virtual Gaming Systems are provided. VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2018 Net sales Cost of goods sold $3,066,000 1,956,000 1.110,000 Gross profit Expenses Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense $864.000 30,000 8,600 18,000 54,000 Total expenses...
Problem 3-13 Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of December 31, 2016 (Thousands of Dollars) Cash $ 225,000 Accounts payable $601,866 Receivables 1,575,000 Notes payable 326,634 Inventories 1,125,000 Other current liabilities 525,000 Total current assets $2,925,000 Total current liabilities $1,453,500 Net fixed assets 1,350,000 Long-term debt 1,068,750 Common equity 1,752,750 Total assets $4,275,000 Total liabilities and equity $4,275,000 Lozano Chip Company: Income Statement for Year Ended December...
Use the following information to answer the question
below: note all sales are credit sales.
Compute each of the following ratios for 2018 and 2019
and indicate whether each ratio was getting "better" or "worse"
from 2018 to 2019 and was "good" or "bad" compared to the industry
Avg. 2019 (round all numbers to 2 digits past the decimal
place).
Income Stmt info: 2018 2019 Sales $ 1,000,000 $ 1,050,000 less Cost of Goods Sold: - 400,000 _ 432.000 Gross...
Assets Current assets Cash Accounts receivable Inventory FUT VUUS) 2018 2019 2018 2019 Liabilities and Owners' Equity Current liabilities $ 100 $ 115 Accounts payable $ 75 $ 105 170 150 Notes payable 100 120 120 120 Total $ 390 $ 385 Total $ 175 $ 225 $ 250 $ 290 Long-term debt Owners' equity Common stock Accumulated retained earnings 122 $ 190 $ 275 Fixed assets 348 Net plant and equipment $ 500 $ 600 Total Equity $ 465...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 10 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 10 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 10 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 10 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 10 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 10 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 10 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 10 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 10 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 10 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 10 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 10 months ago