Exam 14: Financial Statement Analysis

Financial statements for Orange Company appear below: Dividends during Year 2 totaled $156 thousand, of which $18 thousand were preferred dividends. The market price of a share of common stock on December 31, Year 2 was $100. -Orange Company's accounts receivable turnover for Year 2 was closest to:

Fraser Company had $130,000 in sales on account last year.The beginning accounts receivable balance was $10,000 and the ending accounts receivable balance was $14,000.The company's accounts receivable turnover was closest to:

Financial statements for Harwich Company for the most recent year appear below: The balances in the Cash, Accounts Receivable, Inventory, Bonds Payable, Common Stock, and Additional Paid-In Capital accounts are unchanged from the beginning of the year. A $0.75 per share dividend was declared and paid during the year. On December 31, Harwich Company's common stock was trading at $24.00 per share. -Harwich Company's inventory turnover ratio for the year was closest to:

Heningburg Corporation's total current assets are $230,000,its noncurrent assets are $530,000,its total current liabilities are $140,000,its long-term liabilities are $370,000,and its stockholders' equity is $250,000. Required: Compute the company's working capital.Show your work!

Ladabouche Corporation's total current assets are $390,000,its noncurrent assets are $630,000,its total current liabilities are $330,000,its long-term liabilities are $420,000,and its stockholders' equity is $270,000.The current ratio is closest to:

Bonine Corporation has provided the following data: This Year Last Year Accounts receivable \ 88,000 \ 106,000 Inventory \ 178,000 \ 191,000 Sales on account \ 867,000 Cost of goods sold \ 685,000 The accounts receivable turnover for this year is closest to:

Zide Corporation's most recent balance sheet and income statement appear below: Required: Compute the following for Year 2: a.Times interest earned. b.Debt-to-equity ratio.

Excerpts from Goodrow Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $20 thousand. Dividends on preferred stock totaled $10 thousand. The market price of common stock at the end of Year 2 was $5.34 per share. -The earnings per share of common stock for Year 2 is closest to:

Hartzog Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $60 thousand. Dividends on preferred stock totaled $5 thousand. The market price of common stock at the end of Year 2 was $7.04 per share. -The current ratio at the end of Year 2 is closest to:

Financial statements for Larned Company appear below: Dividends during Year 2 totaled $263 thousand, of which $12 thousand were preferred dividends. The market price of a share of common stock on December 31, Year 2 was $160. -Larned Company's return on common stockholders' equity for Year 2 was closest to:

Financial leverage is positive if the interest rate on debt is lower than the return on total assets.

Hick Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $60 thousand. Dividends on preferred stock totaled $20 thousand. The market price of common stock at the end of Year 2 was $9.57 per share. -The dividend yield ratio for Year 2 is closest to:

Bedrosian Incorporated has a line of credit from the Belmont National Bank that is due to be renewed on February 1.The bank has requested the company's current Income Statement and Comparative Statements of Financial Position which appear below. Bedrosian Incorporated Income Statement Year Ended December 31, This Year (in thousands) Revenue Sales \ 60,000 Other. 4,500 Total revenue 64,500 Expenses Cost of goods sold 40,500 Selling and administrative. 11,625 Depreciation and amortization 1,875 Interest 1,500 Total expenses 55,500 Income before income taxes 9,000 Income taxes. 3,600 Net income 5,400 Less: Dividends to common stockholders ( \ 3.86 per share) 2,550 Net income added to retained earnings 2,850 Retained earnings, beginning of year 8,550 Retained earnings, end of year. \1 1,400 Earnings per share \8 .18 Bedrosian Incorporated Statement of Financial Position As of December 31 (in thousands) This Year Last Year Assets Current assets: Cash and marketable securities \ 1,950 \ 1,575 Accounts receivable, net. 3,600 3,750 Inventories 4,875 4,650 Prepaid items 375 225 Total current assets 10,800 Noncurrent assets: Investments, at cost 7,950 7,950 Deposits. 750 600 Property, plant, and equipment 21,000 19,500 Total assets \ 40,500 \ 38,250 Liabilities and Shareholders' Equity Short-term loans \ 1,650 \ 1,800 Accounts payable 5,400 5,325 Salaries and wages payable 1,950 2,025 Total current liabilities 9,000 9,150 Long-term debt 12,000 Total liabilities Shareholders' equity Common stock, at par 3,300 3,150 Paid-in capital in excess of par. 4,800 4,575 Total paid-in capital. 8,100 7,725 Retained earnings 11,400 Total stockholders' equity Total liabilities and stockholders' equity The bank has also requested that Bedrosian calculate a number of financial ratios.Bedrosian's financial ratios have not yet been calculated for this year,but the company's accounting staff has gathered the following industry averages for the ratios from various sources. Industry Averages Return on total assets 6.4\% Return on common stockholders' equity 12.5\% Current ratio. 1.86 Acid-test ratio 0.85 Debt-to-equity ratio 1.23 Times interest earned ratio 7.78 Dividend payout ratio. 39.6\% Required: a.Calculate the following financial ratios for this year for Bedrosian Incorporated. 1.Return on total assets. 2.Return on common stockholders' equity. 3.Current ratio. 4.Acid-test ratio. 5.Debt-to-equity ratio. 6.Times interest earned. 7.Dividend payout ratio. b.By comparing the ratios calculated in Requirement A with the industry ratios,evaluate Bedrosian's operations.

Kaelker Corporation has provided the following data: This Year Last Year Accounts receivable. \ 95,000 \ 101,000 Inventory. \ 213,000 \ 186,000 Sales on account \ 854,000 Cost of goods sold \ 671,000 The inventory turnover for this year is closest to:

The average stockholders' equity for Horn Co.last year was $2,000,000.Included in this figure was $200,000 of preferred stock.Preferred dividends were $16,000.If the return on common stockholders' equity was 12.5% for the year,net income was:

Eaglen Corporation has provided the following data: Required: Compute the inventory turnover for this year:

Delatrinidad Corporation's net income last year was $7,736,000.The dividend on common stock was $12.60 per share and the dividend on preferred stock was $2.80 per share.The market price of common stock at the end of the year was $53.30 per share.Throughout the year,400,000 shares of common stock and 200,000 shares of preferred stock were outstanding.The dividend payout ratio is closest to:

Hartzog Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $60 thousand. Dividends on preferred stock totaled $5 thousand. The market price of common stock at the end of Year 2 was $7.04 per share. -The dividend payout ratio for Year 2 is closest to:

Financial statements for Orange Company appear below: Dividends during Year 2 totaled $156 thousand, of which $18 thousand were preferred dividends. The market price of a share of common stock on December 31, Year 2 was $100. -Orange Company's times interest earned for Year 2 was closest to:

Excerpts from Goodrow Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $20 thousand. Dividends on preferred stock totaled $10 thousand. The market price of common stock at the end of Year 2 was $5.34 per share. -The book value per share at the end of Year 2 is closest to: