Exam 12: Financial Statement Analysis

Grogan Inc. Grogan Inc. had the following information available from its 2011 and 2012 financial statements: Refer to the Grogan Inc. information above. Grogan had an average of 7,000 shares of common stock outstanding during 2012. The company's earnings per share for 2012 is: (round to two decimal places)

Bernstein Inc. Bernstein Inc. is a local retailer. The following selected information is available from their 2011 and 2012 financial statements: Refer to the Bernstein Inc. information above. What was Bernstein's number of days inventory was held before sale in 2012? (round to two decimal places)

Partin Manufacturing Partin Manufacturing has the following information available from its 12/31/12 and 12/31/11 financial statements: Refer to the Partin Manufacturing information above. Partin's debt-to-equity ratio for the year 2012 is: (round to two decimal places)

Torrence Inc. has recently calculated the inventory turnover for the current year to be 30. In prior years, the same ratio was always lower. Which of the following statements would be the best interpretation for the reason for the ratio's change?

Grogan Inc. Grogan Inc. had the following information available from its 2011 and 2012 financial statements: Refer to the Grogan Inc. information above. Grogan had an average of 7,000 shares of common stock outstanding during 2012. At the end of the year, the market price per share was $100. The company's price earnings (P/E) ratio for 2012 is: (round to two decimal places)

Hardister Corp. Hardister Corp. has the following information available from its financial statements for 2012: Refer to the Hardister Corp. information above. At the end of 2012, Hardister's common stock was listed on the stock exchange as having a market price of $65 per share and there are 10,000 shares outstanding. Hardister has no preferred stock. What would be Hardister's price earnings (P/E) ratio for 2012? (round to two decimal places)

List two ratios that are measures of solvency.

Plumeria Inc. has recently calculated the accounts receivable turnover for the current year to be 15. In prior years, the same ratio was always higher. Which of the following statements would be the best interpretation for the reason for the ratio's change?

Munson Auto Parts Inc. is a retailer of auto parts and supplies. They often deliver auto parts to various mechanic shops around town allowing the shops to pay for the parts delivered within 45 days. Recently, Munson's accountant has computed that the accounts receivable turnover ratio is "7". Assuming the company is open 365 days a year, is the company receiving payment from its customers in a timely enough fashion? Explain.

Cheshire Inc. had the following condensed income statements for the years ending December 31, 2012 and 2011. Required: Using vertical analysis, prepare common-size comparative income statements for 2012 and 2011. Round percentages to two decimal places.

Grogan Inc. Grogan Inc. had the following information available from its 2011 and 2012 financial statements: Refer to the Grogan Inc. information above. Performing a horizontal analysis on Grogan's total assets shows that they have:

Which of the following account balances would not be used in the calculation of the current ratio?

Vance Inc. had the following condensed income statements for the years ending December 31, 2012 and 2011. Required: Using vertical analysis, prepare common-size income statements for 2012 and 2011. Round percentages to two decimal places.

Grogan Inc. Grogan Inc. had the following information available from its 2011 and 2012 financial statements: Refer to the Grogan Inc. information above. Grogan's working capital for 2012 is:

What is meant by the term liquidity and why are stakeholders interested in ratios that measure it?

Morrell Inc. had the following information available from its 2011 and 2012 condensed balance sheets Required: Using vertical analysis, prepare common-size income statements for 2012 and 2011. Round percentages to two decimal places.

Why do decision-makers analyze financial statements and how is ratio analysis useful in the process?

Schulte Enterprises has a debt-to-equity ratio of .67 in 2012. How would you interpret this ratio?

How is the times interest earned ratio computed? List one of the weaknesses of this ratio and list the comparable ratio that improves upon these weaknesses.

ABC Inc. has determined that it needs to increase its current ratio in order to be in compliance with a creditor's loan agreement. All else being equal, which of the following ways would be best for increasing their current ratio?