Question

Question 9 Comparative financial statement data for Ivanhoe Company and Sheridan Company, two competitors, appear below. All balance sheet data are as of December 31, 2017 Ivanhoe Company 2017 Net sales Cost of goods sold Operating expenses Interest expense Income tax expense Current assets Plant assets (net) Current liabilities Long-term liabilities Net cash provided by operating activities Capital expenditures Dividends paid on common stock Weighted average number of shares outstanding $2,664,000 1,739,000 418,840 13,320 125,800 473,900 787,360 98,161 160,580 204,240 133,200 53,280 80,000 Sheridan Company 2017 $917,600 503,200 145,040 5,624 53,280 193,536 206,797 49,900 60,212 53,280 29,600 22,200 50,000 Compute the net income and earnings per share for each company for 2017. (Round Earnings per share to 2 decimal places, e.g. $2.78.)

Answer 1

a answers earning net income per share 367040 4.59 210456 4.21 Ivanhoe company sheridan company current ratio b working capital 375739 143636 4.8 Ivanhoe company sheridan company :1 :1 3.9 с debt to assets 20.5 27.5 free cash flow 17760 1480 % Ivanhoe company sheridan company %

working notes

Ivanhoe sheridan company company 2017 2017 193536 206797 473900 787360 1261260 98161 current assets plant assets total assets current liabilities long tern liabilities totl liabilities net cash provided by operating expenses capital expenditure dividends paid on common stock weighted avg shares outstanding income statement 160580 258741 400333 49900 60212 110112 53280 29600 22200 50000 204240 133200 532801 80000 sales cost of goods sold gross profit operating expenses operating income interest expense income tax expense net income Ivanhoe company 2664000 1739000 925000 418840 506160 sheridan company 917600 503200 414400 145040 269360 5624 13320 125800 367040 53280 210456

working capital = current assets - current liabilities

current ratio= current assets / current liabilities

earning per share = net income/shares outstanding

free cash flow= net cash provided by operating activities- capital expenditure- dividends paid

note; since the answers are sensitive because of round off factor so please use the comment box if required further clarification.