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financial analsis

August 15th, 2017 admin

Fianacial analysis

Problem 17-1A Ratios, common-size statements, and trend percents L.O. P1, P2, P3

[The following information applies to the questions displayed below.]

Selected comparative financial statements of Bennington Company follow:
BENNINGTON COMPANY
Comparative Income Statements
For Years Ended December 31, 2012, 2011, and 2010
2012 2011 2010
Sales $ 457,083 $ 350,163 $ 243,000
Cost of goods sold 275,164 219,202 155,520
Gross profit 181,919 130,961 87,480
Selling expenses 64,906 48,322 32,076
Administrative expenses 41,137 30,814 20,169
Total expenses 106,043 79,136 52,245
Income before taxes 75,876 51,825 35,235
Income taxes 14,113 10,624 7,153
Net income $ 61,763 $ 41,201 $ 28,082
BENNINGTON COMPANY
Comparative Balance Sheets
December 31, 2012, 2011, and 2010
2012 2011 2010
Assets
Current assets $ 47,321 $ 37,023 $ 49,491
Long-term investments 0 1,200 3,960
Plant assets, net 85,231 90,490 53,188
Total assets $ 132,552 $ 128,713 $ 106,639
Liabilities and Equity
Current liabilities $ 19,353 $ 19,178 $ 18,662
Common stock 71,000 71,000 53,000
Other paid-in capital 8,875 8,875 5,889
Retained earnings 33,324 29,660 29,088
Total liabilities and equity $ 132,552 $ 128,713 $ 106,639

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1.

value:

1.00 points

Problem 17-1A Part 1

Required:
1. Compute each year’s current ratio. (Round your answers to 1 decimal place.)
Current ratio December 31, 2012: to
Current ratio December 31, 2011: to
Current ratio December 31, 2010: to

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2.

value:

1.00 points

Problem 17-1A Part 2

2. Express the income statement data in common-size percents. (Percents are rounded to two decimals and thus may not exactly sum to totals and subtotals. Round your answers to 2 decimal places. Omit the “%” sign in your response.)
BENNINGTON COMPANY

Common-Size Comparative Income Statements

For Years Ended December 31, 2012, 2011, and 2010
2012 2011 2010
Sales % % %
Cost of goods sold
Gross profit
Selling expenses
Administrative expenses
Total expenses
Income before taxes
Income taxes
Net income % % %

eBook Links (3)references

 

3.

value:

1.00 points

Problem 17-1A Part 3

3. Express the balance sheet data in trend percents with 2010 as the base year. (Round your answers to 2 decimal places. Leave no cells blank – be certain to enter “0” wherever required. Omit the “%” sign in your response.)
BENNINGTON COMPANY

Balance Sheet Data in Trend Percents

December 31, 2012, 2011, and 2010
2012 2011 2010
Assets
Current assets % % %
Long-term investments
Plant assets
Total assets
Liabilities and Equity
Current liabilities % % %
Common stock
Other contributed capital
Retained earnings
Total liabilities and equity

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Problem 17-4A Calculation of financial statement ratios L.O. P3

Selected year-end financial statements of McCord Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2010, were inventory, $53,900; total assets, $229,400; common stock, $95,000; and retained earnings, $52,348.)
McCORD CORPORATION

Income Statement

For Year Ended December 31, 2011
Sales $ 450,600
Cost of goods sold 297,450
Gross profit 153,150
Operating expenses 99,500
Interest expense 3,900
Income before taxes 49,750
Income taxes 20,041
Net income $ 29,709
McCORD CORPORATION

Balance Sheet

December 31, 2011
Assets Liabilities and Equity
Cash $ 16,000 Accounts payable $ 16,500
Short-term investments 8,800 Accrued wages payable 4,800
Accounts receivable, net 31,400 Income taxes payable 3,300
Notes receivable (trade)* 4,000 Long-term note payable, secured
Merchandise inventory 32,150 by mortgage on plant assets 65,400
Prepaid expenses 3,050 Common stock 95,000
Plant assets, net 153,300 Retained earnings 63,700
Total assets $ 248,700 Total liabilities and equity $ 248,700
* These are short-term notes receivable arising from customer (trade) sales.
Required:
Compute the following. (Use 365 days a year. Do not round intermediate calculations and round your final answers to 1 decimal place. Omit the “%” sign in your response):
(1) Current ratio to
(2) Acid-test ratio to
(3) Days’ sales uncollected (including note) days
(4) Inventory turnover times
(5) Days’ sales in inventory days
(6) Debt-to-equity ratio to
(7) Times interest earned times
(8) Profit margin ratio %
(9) Total asset turnover times
(10) Return on total assets %
(11) Return on common stockholders’ equity %
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