Homework Answers
Crediting rating of a company means whether he is capble to payoff his loan libility without making any default. If a company generate profit after payment of his loan libility on time than his credit rating will be high.
An analysis of credit rating shows his profit pettern after payment of loan liability (Principal and Interest).
In 2019
Loan liability
Long term debt + Current maturity of Debt + Short Term Debt
= $400,000 + $189,130 +$28,995
= $618,125
In 2020
=$525,000 + $100,000 + $117,994
= $742,994
In 2020 loan libility of company is increased as compared to 2019. but in both years company is capable to pay interest on such loan and earned profit from operation.
But profit of company is decreased in 2020 as compared to 2019.
Hence data that will support the decision of credit agencies are aa under:
1. Trend of Debt balance
2. Periodic payment of debt libility without making default
3. Profit after payment of interest libility
4. Interest component trend analysis
Add Answer to:
12.24 (LO 1, 2, 3) Comprehensive financial statement analysis Koester, Inc., states in its 2020 10-K...
12.24 (LO 1, 2, 3) Comprehensive financial statement analysis Koester, Inc., states in its 2020 10-K...
12.24 (LO 1, 2, 3) Comprehensive financial statement analysis Koester, Inc., states in its 2020 10-K filing with the SEC, “In October 2020, two major credit rating agencies changed Koester's long-term credit rating outlook to negative and one of the credit rating agencies reduced Koester's short-term credit rating." Koester's financial statements (in $000) follow. Koester, Inc. Comparative Income Statement For the Year Ended December 31 2020 2019 Sales revenue $5,179,016 $5,102,786 Cost of goods sold 2,806,148 2,692,061 Gross profit 2,372,868...
Question 3 (25 marks) Unit 10 - Financial Statement Analysis Following is a comparative balance sheet...
Question 3 (25 marks) Unit 10 - Financial Statement Analysis Following is a comparative balance sheet for Summer Days Corporation: Summer Days Corporation Comparative Balance Sheet December 31, 2019 and 2018 2019 2018 Current assets: Cash $ 140,000 $ 90,000 Short-term investments 90,000 80,000 Accounts receivable, net 350,000 220,000 Inventory 500,000 430,000 Prepaid expenses 30,000 30,000 Total current assets $1,110,000 $ 850,000 Property, plant, and equipment, net 750,000 500,000 Other assets 280,000 300,000 Total assets ...
Presented below are the comparative balance sheets of Joe’s Garage, Inc., at December 31, 2020, and...
Presented below are the comparative balance sheets of Joe’s Garage, Inc., at December 31, 2020, and 2019. Sales for the year ended December 31, 2020, totaled $1,780,000. JOE’S GARAGE, INC. Balance Sheets December 31, 2020, and 2019 2020 2019 Assets Cash $ 90,000 $ 98,000 Accounts receivable 268,000 212,000 Merchandise inventory 402,000 394,000 Total current assets $ 760,000 $ 704,000 Land 132,000 120,000 Plant and equipment 728,000 650,000 Less: Accumulated depreciation (372,000 ) (314,000 ) Total assets $ 1,248,000 $...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2020 2019 Gross...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2020 2019 Gross sales $15,000 $19,000 1,000 $18,000 12,000 $ 6,000 Sales returns and allowances 100 $14,900 9,000 Net sales Cost of merchandise (goods) sold Gross profit Operating expenses: Depreciation Selling and administrative $ 5,900 $ 2,200 550 360 700 600 2,000 Research Miscellaneous Total operating expenses Income before interest and taxes Interest expense Income before taxes Provision for taxes 500 300 $ 3,400 $ 2,500 $3,810...
Exercise 23.6 Rate of return on stockholders’ equity. LO 23-1 CANNA, Inc. Comparative Income Statement Years...
Exercise 23.6 Rate of return on stockholders’ equity. LO 23-1 CANNA, Inc. Comparative Income Statement Years Ended December 31, 2019 and 2018 Amounts 2019 2018 Sales 1,635,750 1,500,950 Less: Sales returns and allowances 96,750 82,950 Net sales 1,539,000 1,418,000 Cost of goods sold 1,066,300 992,600 Gross profit on sales 472,700 425,400 Selling expenses 215,000 205,000 General expenses 210,000 190,000 Total expenses 425,000 395,000 Net income before income taxes 47,700 30,400 Income tax expense 7,155 4,560 Net income after income taxes...
Question 2 Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative...
Question 2 Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 Assets $ 10,400 2,020 $ 8,000 2,000 1,700 $11,700 1,615 $14,035 Current assets Property, plant, and equipment (net) Other assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Stockholders' equity $ 3,038 $ 3,100 1,287 9,710 1,300 7,300 $11,700 Total liabilities and stockholders' equity $14,035 (a) (a) Prepare a horizontal analysis of the...
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets May 3...
Suppose the comparative balance sheets of Nike,
Inc. are presented here.
Nike, Inc.
Comparative Balance Sheets
May 31
($ in millions)
2020
2019
Assets
Current assets
$ 9,180
$ 9,000
Property, plant, and equipment (net)
1,785
1,700
Other assets
1,656
1,800
Total assets
$12,621
$12,500
Liabilities and Stockholders’ Equity
Current liabilities
$ 3,366
$ 3,400
Long-term liabilities
1,222
1,300
Stockholders’ equity
8,033
7,800
Total liabilities and stockholders’ equity
$12,621
$12,500
(a)
Prepare a horizontal analysis of the balance sheet data...
Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 $10.248 1,890 1,395 $13,533...
Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 $10.248 1,890 1,395 $13,533 $ 8,400 1,800 1,500 $11,700 Assets Current assets Property, plant, and equipment (net) Other assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Stockholders' Equity Total liabilities and stockholders' equity $ 3,465 1,261 8.807 $13,533 $3,500 1,300 6.900 $11,700 Prepare a horizontal analysis of the balance sheet data for Nike, using 2019 as a base. (Show the amount of increase or decrease...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2019 2020 Gross...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2019 2020 Gross sales $19,000 1,000 $18,000 12,000 $6,000 $15,000 100 Sales returns and allowances Net sales Cost of merchandise (goods) sold Gross profit Operating expenses: Depreciation Selling and administrative Research $14,900 9,000 $5,900 $ $ 2,000 500 600 700 2,200 550 Miscellaneous Total operating expenses Income before interest and taxes Interest expense Income before taxes Provision for taxes 360 300 $3,810 $ 2,190 $3,400 2,500 560...
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets...
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 Assets $10,500 $8,400 Current assets Property, plant, and equipment (net) 2,006 1,700 Other assets 1,900 1,406 $13,912 $12,000 Total assets Liabilities and Stockholders' Equity $3,069 $3,100 Current liabilities Long-term liabilities 1,248 1,300 Stockholders' equity 9,595 7,600 $13,912 $12,000 Total liabilities and stockholders' equity Prepare a horizontal analysis of the balance sheet data for Nike, using 2019 as...
12.24 (LO 1, 2, 3) Comprehensive financial statement analysis Koester, Inc., states in its 2020 10-K filing with the SEC, “In October 2020, two major credit rating agencies changed Koester's long-term credit rating outlook to negative and one of the credit rating agencies reduced Koester's short-term credit rating." Koester's financial statements (in $000) follow. Koester, Inc. Comparative Income Statement For the Year Ended December 31 2020 2019 Sales revenue $5,179,016 $5,102,786 Cost of goods sold 2,806,148 2,692,061 Gross profit 2,372,868...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2020 2019 Gross sales $15,000 $19,000 1,000 $18,000 12,000 $ 6,000 Sales returns and allowances 100 $14,900 9,000 Net sales Cost of merchandise (goods) sold Gross profit Operating expenses: Depreciation Selling and administrative $ 5,900 $ 2,200 550 360 700 600 2,000 Research Miscellaneous Total operating expenses Income before interest and taxes Interest expense Income before taxes Provision for taxes 500 300 $ 3,400 $ 2,500 $3,810...
Question 2 Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 Assets $ 10,400 2,020 $ 8,000 2,000 1,700 $11,700 1,615 $14,035 Current assets Property, plant, and equipment (net) Other assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Stockholders' equity $ 3,038 $ 3,100 1,287 9,710 1,300 7,300 $11,700 Total liabilities and stockholders' equity $14,035 (a) (a) Prepare a horizontal analysis of the...
Suppose the comparative balance sheets of Nike,
Inc. are presented here.
Nike, Inc.
Comparative Balance Sheets
May 31
($ in millions)
2020
2019
Assets
Current assets
$ 9,180
$ 9,000
Property, plant, and equipment (net)
1,785
1,700
Other assets
1,656
1,800
Total assets
$12,621
$12,500
Liabilities and Stockholders’ Equity
Current liabilities
$ 3,366
$ 3,400
Long-term liabilities
1,222
1,300
Stockholders’ equity
8,033
7,800
Total liabilities and stockholders’ equity
$12,621
$12,500
(a)
Prepare a horizontal analysis of the balance sheet data...
Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 $10.248 1,890 1,395 $13,533 $ 8,400 1,800 1,500 $11,700 Assets Current assets Property, plant, and equipment (net) Other assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Stockholders' Equity Total liabilities and stockholders' equity $ 3,465 1,261 8.807 $13,533 $3,500 1,300 6.900 $11,700 Prepare a horizontal analysis of the balance sheet data for Nike, using 2019 as a base. (Show the amount of increase or decrease...
LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2019 and 2020 2019 2020 Gross sales $19,000 1,000 $18,000 12,000 $6,000 $15,000 100 Sales returns and allowances Net sales Cost of merchandise (goods) sold Gross profit Operating expenses: Depreciation Selling and administrative Research $14,900 9,000 $5,900 $ $ 2,000 500 600 700 2,200 550 Miscellaneous Total operating expenses Income before interest and taxes Interest expense Income before taxes Provision for taxes 360 300 $3,810 $ 2,190 $3,400 2,500 560...
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Comparative Balance Sheets May 31 ($ in millions) 2020 2019 Assets $10,500 $8,400 Current assets Property, plant, and equipment (net) 2,006 1,700 Other assets 1,900 1,406 $13,912 $12,000 Total assets Liabilities and Stockholders' Equity $3,069 $3,100 Current liabilities Long-term liabilities 1,248 1,300 Stockholders' equity 9,595 7,600 $13,912 $12,000 Total liabilities and stockholders' equity Prepare a horizontal analysis of the balance sheet data for Nike, using 2019 as...
Most questions answered within 3 hours.
-
Jason Allen is saving for an Australian vacation in three years.
He estimates that he will...
asked 1 minute ago -
starting in the radial vein list in order all the vessels through
which an erythrocyte will...
asked 7 minutes ago -
Management at Work
As the training and development manager at the Litter*Bit*Better
Cat Litter Company, part...
asked 10 minutes ago -
What is the significance of the constraints in a physical model?
What part do distinct constraints...
asked 1 hour ago -
a student was diagnosed with myopia (nearshightedness). He can
comfortably read a newspaper when it is...
asked 1 hour ago -
Consider a 3m x 3m window in a house. The thermal conductivity
is reported to be...
asked 1 hour ago -
Why has California been the favorite destination of large number
of secondary migrants?
asked 2 hours ago -
Do not neglect the old for the new. The existing business must
not lose priority simply...
asked 5 hours ago -
Kylie is a single mom with two dependent children,
Tanner, age 7 and Olivia, age 11....
asked 6 hours ago -
Phosphorous + bromine = phosphorous tribromide. If 35.0 g of
bromine are reacted and 27.9 grams...
asked 8 hours ago -
Derive the long wavelength limit of the Planck energy density
distribution
asked 7 hours ago -
Calculate the pH of each of the following solutions.
0.50 M HBr
3.1×10−4 M KOH
4.2×10−5...
asked 11 hours ago