Homework Answers
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| Answer 1 | ||
| Kellman company | Amount $ | Note |
| Common Stock | 600,000.00 | A |
| Par value | 10.00 | B |
| Number of shares | 60,000.00 | C=A/B |
| Net Income | 250,000.00 | D |
| Less: Preference Dividend | 9,000.00 | E |
| (9% of 100,000) | ||
| Net Income common for shareholders | 241,000.00 | F=D-E |
| Earnings per share | 4.02 | G=F/C |
| Market price of common share | 30.00 | H |
| Price Earning Ratio | 7.50 | I=H/G |
| Market price of common share/ Earnings per share |
| So answer is option a. |
| Answer 2 | |
| Carmen company | |
| Income Statement | Amount $ |
| Sales | 1,300,000.00 |
| Net Income | 250,000.00 |
| Balance Sheets | |
| Total Assets | 2,000,000.00 |
| Average assets | 2,200,000.00 |
| Average Common Stock holders Equity | 1,000,000.00 |
| Average Common Stock holders Equity | |
| Shares of common stock outstanding | 10,000.00 |
| Ratio | |
| Assets Turnover Ratio | 0.6 |
| Sales Revenue/Average Assets | |
| Return on Total Assets | 12.5% |
| Net Income/Total Assets | |
| Return on Common Stock holders Equity | 130.0% |
| Net Income/Average Common Stock holders Equity | |
| Earnings per share | 25.0 |
| Net Income/Shares of common stock outstanding |
| Answer 3 | ||
| Income Statement | Current | Preceding |
| Net Income | 110,000.00 | 155,000.00 |
| Less: Preference Dividend | 25,000.00 | 25,000.00 |
| Net Income for common for shareholders | 85,000.00 | 130,000.00 |
| Balance Sheets | ||
| Assets | Current | Preceding |
| Current Assets | 745,000.00 | 820,000.00 |
| Property, Plant and Equipment | 1,510,000.00 | 1,400,000.00 |
| Total Assets | 2,255,000.00 | 2,220,000.00 |
| Liabilities & Stockholders' Equity | Current | Preceding |
| Current Liabilities | 160,000.00 | 140,000.00 |
| Long Term Liabilities | 400,000.00 | 400,000.00 |
| Total Liabilities | 560,000.00 | 540,000.00 |
| Common Stock | 1,200,000.00 | 1,200,000.00 |
| Preferred Stock | 250,000.00 | 250,000.00 |
| Retained Earnings | 230,000.00 | 160,000.00 |
| Total Stockholders' Equity | 1,680,000.00 | 1,610,000.00 |
| Current | |
| Common Stock | 1,200,000.00 |
| Par value | 10.00 |
| Number of shares | 120,000.00 |
| Common Dividend | 70,000.00 |
| Dividend Per share | 0.58 |
| Common Stock | 1,200,000.00 |
| Retained Earnings | 230,000.00 |
| Total Common Stockholders' Equity | 1,430,000.00 |
| Answer a | Current |
| Return on Total Assets | 4.9% |
| Net Income/Total Assets | |
| Answer b | |
| Return on Stock holders Equity | 6.5% |
| Net Income/Stock holders Equity | |
| Answer c | |
| Return on Common Stock holders Equity | 5.9% |
| Net Income for common for shareholders/Common Stock holders Equity | |
| Answer d | |
| Earnings per share | 0.7 |
| Net Income for common for shareholders/Number of shares | |
| Answer e | |
| Price Earnings Ratio | 35.3 |
| Market Price Per Share/ Earnings Per share on Common Stock | |
| Answer f | |
| Dividend Yield | 2.3% |
| Dividend Per share on Common Stock/ Market Price Per Share |
| Answer 4 | Amount $ |
| Opening Accounts Receivable | 42,726.00 |
| Ending Accounts Receivable | 47,669.00 |
| Average Receivable | 45,197.50 |
| Sales on account | 550,112.00 |
| Accounts Receivables Turnover | 12.17 |
| Net Sales / Average Receivable | |
| Number of days sales in receivable | 30.00 |
| 365/Accounts Receivables Turnover | |
| So answer is option c. |
| Answer 5 | |||
|
Amount $ | Amount $ | |
| Particulars | |||
| Net Income | 231,290.00 | ||
| Adjustment to reconcile Net Income to Net Cash | |||
| Add: | |||
| Depreciation & Amortization Expense | 21,208.00 | ||
| Loss on sale of equipment | 6,472.00 | ||
| Cash flow from Operations | 258,970.00 | ||
| Changes in Current Assets/Current Liabilities | |||
| Increase in Accounts Receivable | (16,015.00) | ||
| Increase in Inventory | (31,068.00) | ||
| Decrease in Prepaid Assets | 2,889.00 | ||
| Decrease in Accounts Payable | (7,357.00) | ||
| Decrease in Taxes Payable | - | (51,551.00) | |
| Net cash provided by operating activities | 207,419.00 | ||
| So answer is option b. |
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Use this information for Kellman Company to answer the question that...
The following data are taken from the financial statements, determine for the current year the (a)...
The following data are taken from the financial statements, determine for the current year the (a) return on total assets, (b) return on stockholders' equity, (c) return on common stockholders' equity, (d) earnings per share on common stock, (e) price-earnings ratio on common stock, and (f) dividend yield. The current market price per share of common stock is $25. Current Year Current assets $745,000 Preceding Year $820,000 1,400,000 1,510,000 Property, plant, and equipment Current liabilities 160,000 140,000 400,000 400,000 250,000...
b. The following data are taken from the financial statements: Current assets Property, plant, and equipment...
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Use this information for Kellman Company to answer the question that follow. The balance sheets at...
Use this information for Kellman Company to answer the question that follow. The balance sheets at the end of each of the first two years of operations indicate the following: Kellman Company Year 2 Year 1 Total current assets $627,600 62,500 Total investments $593,500 53,800 783,200 942,400 80,500 Total property, plant, and equipment Total current liabilities Total long-term liabilities Preferred 9% stock, $100 par 112,200 291,200 244,800 95,700 Common stock, $10 par 95,700 566,300 61,100 506,000 Paid-in capital in excess...
Use this information for Kellman Company to answer the question that follow. The balance sheets at...
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The following data are taken from the financial statements, determine for the current year the (a)...
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Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $10 par value (no change $1,400,000 during the year) Preferred $10 stock, $200 par (no change 4.000.000 during the year) The net income was $452,000 and the declared dividends on the common stock were $35,000 for the current year. The market price of the common stock is $14.40 per...
The stockholders’ equity accounts of Pronghorn Corp. on January 1, 2017, were as follows. Preferred Stock...
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Use this information for Kellman Company to answer the question that follow. The balance sheets at the end of each of the first two years of operations indicate the following: Kellman Company Year 2 Year 1 Total current assets $627,600 62,500 Total investments $593,500 53,800 783,200 942,400 80,500 Total property, plant, and equipment Total current liabilities Total long-term liabilities Preferred 9% stock, $100 par 112,200 291,200 244,800 95,700 Common stock, $10 par 95,700 566,300 61,100 506,000 Paid-in capital in excess...
Use this information for Kellman Company to answer the question that follow. The balance sheets at the end of each of the first two years of operations indicate the following: Kellman Company Year 2 Year 1 Total current assets Total investments $553,100 53,700 778,600 80,400 Total property, plant, and equipment Total current liabilities $601,900 64,500 877,600 110,300 294,600 95,500 518,400 63,400 Total long-term liabilities 234,300 Preferred 9% stock, $100 par 95,500 518,400 Common stock, $10 par Paid-in capital in excess...
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Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year: Common stock, $10 par value (no change $1,400,000 during the year) Preferred $10 stock, $200 par (no change 4.000.000 during the year) The net income was $452,000 and the declared dividends on the common stock were $35,000 for the current year. The market price of the common stock is $14.40 per...
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