Exam 14: Financial Statement Analysis

Financial statements for Laroche Company appear below: Shareholders' Equity: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2250 Costs of Goods Sold \ 1570 Gross Margin \ 680 Operating Expenses \ 270 Net Operating Income \ 410 Interest Expense \ 30 Net Income before Taxes \ 380 Income Taxes (30\%) \ 114 Net Income \ 266 Total dividends during Year 2 were $\$ 166,000$ , of which $\$ 10,000$ were preferred dividends. The market price of a common share on December 31, Year 2 was $\$ 150$ . -Laroche Company's return on total assets for Year 2 was closest to which of the following?

Financial statements for Larned Company appear below: Shareholders' Equity: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2930 Costs of Goods Sold \ 2050 Gross Margin \ 880 Operating Expenses \ 350 Net Operating Income \ 530 Interest Expense \ 40 Net Income before Taxes \ 490 Income Taxes (30\%) \ 147 Net Income \ 343 Total dividends during Year 2 were $\$ 263,000$ , of which $\$ 12,000$ were for preferred shares. The market price of a common share on December 31, Year 2 was $\$ 160$ . -Larned Company's dividend yield ratio on December 31,Year 2 was closest to which of the following?

Financial statements for Larosa Company appear below: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) hline Sales (All on Account) \ 1870 Costs of Goods Sold \ 1300 Gross Margin \ 570 Operating Expenses \ 220 Net Operating Income \ 350 Interest Expense \ 40 Net Income before Taxes \ 310 Income Taxes (30\%) \ 93 Net Income \ 217 Total dividends during Year 2 were $\$ 47,000$ , of which $\$ 10,000$ were preferred dividends. The market price of a common share on December 31 , Year 2 was $\$ 70$ . -Larosa Company's return on total assets for Year 2 was closest to which of the following?

Selected data for the MK Company follow: Current Year Prior Year Preferred Shares, 8\% Par Value \ 50 \ 250000 \ 250000 Common Shares, Per Value \ 10 \ 500000 \ 500000 Retained Earnings at End of Year \ 257000 \ 240000 Net Income \ 102000 \ 90000 Dividends Paid on Preferred Shares \ 20000 \ 20000 Dividends Paid on Common Shares \ 65000 \ 60000 Qouted Market Price per Common Share at Year End \2 5 \2 0 -What was the dividend payout ratio for the prior year?

Karma Company has total assets of $190,000 and total liabilities of $90,000.The company's debt-to-equity ratio is closest to which of the following?

How is horizontalanalysis of financial statements accomplished?

Selected financial data for Barnstable Company appear below: Year 2 Year 1 Sales (in thousands) Operating Expense \ 1,500 \ 1,200 Interest Expense \ 450 \ 400 Cost of Goods Sold \ 75 \ 30 Dividends Declared and Paid \ 900 \ 720 -For Year 2,what was the net operating income as a percentageof sales?

Financial statements for Raridan Company appear below: larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 1900 Costs of Goods Sold \ 130 Gross Margin \ 570 Operating Expenses \ 220 Net Operating Income \ 350 Interest Expense \ 30 Net Income before Taxes \ 320 Income Taxes (30\%) \ 96 Net Income \ 224 Required: Calculate the following for Year 2: a)Current ratio. b)Acid-test (quick)ratio. c)Average collection period (age of receivables). d)Inventory turnover. e)Times interest earned. f)Debt-to-equity ratio.

Financial statements for Laroche Company appear below: Shareholders' Equity: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2250 Costs of Goods Sold \ 1570 Gross Margin \ 680 Operating Expenses \ 270 Net Operating Income \ 410 Interest Expense \ 30 Net Income before Taxes \ 380 Income Taxes (30\%) \ 114 Net Income \ 266 Total dividends during Year 2 were $\$ 166,000$ , of which $\$ 10,000$ were preferred dividends. The market price of a common share on December 31, Year 2 was $\$ 150$ . -Laroche Company's return on common shareholders' equity for Year 2 was closest to which of the following?

If a loss resulting from an earthquakeis classified as extraordinary,which of the following disclosures meets the minimum requirements in Canada?

Financial statements for Marcial Company appear below: 11ee3cef_af3d_14b8_8c2a_ab0280ef355e_TB1327_11 -Marcial Company's current ratio at the end of Year 2 was closest to which of the following?

Financial statements for Marcell Company appear below: Marcell Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2550 Costs of Goods Sold \ 1780 Gross Margin \ 770 Operating Expenses \ 300 Net Operating Income \ 470 Interest Expense \ 50 Net Income before Taxes \ 420 Income Taxes (30\%) \ 126 Net Income \ 294 -Marcell Company's working capital (in thousands of dollars)at the end of Year 2 was closest to which of the following?

Financial statements for Marcial Company appear below: 11ee3cef_af3d_14b8_8c2a_ab0280ef355e_TB1327_11 -Marcial Company's inventory turnover for Year 2 was closest to which of the following?

Financial statements for Narumi Company appear below: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2050 Costs of Goods Sold \ 1430 Gross Margin \ 620 Operating Expenses \ 240 Net Operating Income \ 380 Interest Expense \ 50 Net Income before Taxes \ 330 Income Taxes (30\%) \ 99 Net Income \ 231 -Narumi Company's times interest earned for Year 2 was closest to which of the following?

Financial statements for Marcial Company appear below: 11ee3cef_af3d_14b8_8c2a_ab0280ef355e_TB1327_11 -Marcial Company's average sale period (turnover in days)for Year 2 was closest to which of the following?Do not round intermediate calculations.

Financial statements for Larned Company appear below: Shareholders' Equity: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) Sales (All on Account) \ 2930 Costs of Goods Sold \ 2050 Gross Margin \ 880 Operating Expenses \ 350 Net Operating Income \ 530 Interest Expense \ 40 Net Income before Taxes \ 490 Income Taxes (30\%) \ 147 Net Income \ 343 Total dividends during Year 2 were $\$ 263,000$ , of which $\$ 12,000$ were for preferred shares. The market price of a common share on December 31, Year 2 was $\$ 160$ . -Larned Company's dividend payout ratio for Year 2 was closest to which of the following?

Arlberg Company's net income last year was $250,000.The company had 150,000 common shares and 80,000 preferred shares.There was no change in the number of common or preferred shares outstanding during the year.The company declared and paid dividends last year of $1.30 per common share and $1.40 per preferred share.The earnings per common share was closest to which of the following?

Selected data for the MK Company follow: Current Year Prior Year Preferred Shares, 8\% Par Value \ 50 \ 250000 \ 250000 Common Shares, Per Value \ 10 \ 500000 \ 500000 Retained Earnings at End of Year \ 257000 \ 240000 Net Income \ 102000 \ 90000 Dividends Paid on Preferred Shares \ 20000 \ 20000 Dividends Paid on Common Shares \ 65000 \ 60000 Qouted Market Price per Common Share at Year End \2 5 \2 0 -What was the price-earnings ratio for the prior year?

Financial statements for Larosa Company appear below: Larned Company Income Statement For the Year Ended December 31, Year 2 (dollars in thousands) hline Sales (All on Account) \ 1870 Costs of Goods Sold \ 1300 Gross Margin \ 570 Operating Expenses \ 220 Net Operating Income \ 350 Interest Expense \ 40 Net Income before Taxes \ 310 Income Taxes (30\%) \ 93 Net Income \ 217 Total dividends during Year 2 were $\$ 47,000$ , of which $\$ 10,000$ were preferred dividends. The market price of a common share on December 31 , Year 2 was $\$ 70$ . -Larosa Company's return on common shareholders' equity for Year 2 was closest to which of the following?

The following financial data have been taken from the records of CPZ Enterprises. Accounts Receivable \ 200000 Accounts Payable \ 80000 Bonds Payable, Due in Ten Years \ 300000 Cash \ 100000 Interest Payable, Due in Three Months \ 10000 Inventory \ 440000 Land \ 250000 Notes Payable, Due in Six Months \ 50000 -What will happen to the ratios below if CPZ Enterprises uses cash to pay 50% of its accounts payable? Current Ratio Acid-Test Raio A) Increase Increase B) Decrease Decrease C) Increase Decrease D) Decrease Increase