Homework Answers
| PARTICUARS | THIS YEAR | LAST YEAR |
| ASSETS | ||
| All current assets | $74,000,000 | $68,000,000 |
| All long term assest | $61,000,000 | $59,000,000 |
| Total Assets | $135,000,000 | $127,000,000 |
| LIABILITIES & STOCKHOLDER'S EQUITY | ||
| All current liabilities | $61,000,000 | $57,000,000 |
| All long term liabilities | $35,000,000 | $45,000,000 |
| Stockholder's equity | $39,000,000 | $25,000,000 |
| Total liabilities & stockholder's equity | $135,000,000 | $127,000,000 |
| PARTICUARS | THIS YEAR | LAST YEAR |
| ASSETS | ||
| All current assets | $74,000,000 | $68,000,000 |
| All long term assest | $61,000,000 | $59,000,000 |
| Total Assets | $135,000,000 | $127,000,000 |
| LIABILITIES & STOCKHOLDER'S EQUITY | ||
| All current liabilities ($61,000,000 + $9,000,000) | $70,000,000 | $57,000,000 |
| All long term liabilities | $35,000,000 | $45,000,000 |
| Stockholder's equity ($39,000,000 - $9,000,000) | $30,000,000 | $25,000,000 |
| Total liabilities & stockholder's equity | $135,000,000 | $127,000,000 |
Due to omission of vendr invoices and warranty liability the year end balance of all cureent liabilities will increase by $9,000,000 and the net income will decrease by $9,000,000. the net income after correctiion is $5,000,000.
CURRENT RATIO
| FORMULA | THIS YEAR | LAST YEAR | |
| Comapny statements | Current assets/current laibilities | 1.21 | 1.19 |
| ($74,000,000/$61,000,000) | ($68,000,000/$57,000,000) | ||
| Correct Statement | Current Assets/Current liabilities | 1.06 | 1.19 |
| ($74,000,000/$70,000,000) | ($68,000,000/$57,000,000) |
The current ratio will be worse after correction. As the current ratio further reduced to 1.06 from 1.21 due to increase in current liabilities.
ROI
| FORMULA | THIS YEAR | |
| Comapny statements | (Net Income/Total assets)*100 | 10.37% |
| ($14,000,000/$135,000,000)*100 | ||
| Correct Statement | (Net Income/Total assets)*100 | 3.7% |
| ($5,000,000/$135,000,000)*100 |
ROI will be worse as it has reduced from 10.37% to 3.7% due to decrease in net income.
ROE
| FORMULA | THIS YEAR | |
| Comapny statements | (Net Income/Total stickholder's equity)*100 | 35.90% |
| ($14,000,000/$39,000,000)*100 | ||
| Correct Statement | (Net Income/Total stickholder's equity)*100 | 12.82% |
| ($5,000,000/$39,000,000)*100 |
ROE will be worse as it has reduced from 35.90% to 12.82% due to decrease in net income.
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QUESTIONS 30.00007 points Save Answer The MBA802 Company failed to record (accrue) $9,000,000 of cost related...
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With...
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With this omission, the company's summary financial statements were stated as follows: Summarized Income Statement Sales $50,000,000 All Cost (incl. Interest & Taxes) $40,000,000 Net Income $10,000,000 Summarized Balance Sheet This Year Last Year Assets: All Current Assets combined $50,000,000 $40,000,000 All Long-Term Assets combined $50,000,000 $40,000,000 Total Assets: $100,000,000 $80,000,000 Liabilities & Stockholders Equity All Current Liabilities combined $30,000,000 $25,000,000 All Long-Term Liabilities...
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With...
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With this omission, the company's summary financial statements were stated as follows: Summarized Income Statement Sales $50,000,000 All Cost (incl. Interest & Taxes) $40,000,000 Net Income $10,000,000 Summarized Balance Sheet This Year Last Year Assets: All Current Assets combined $50,000,000 $40,000,000 All Long-Term Assets combined $50.000.000 _$40,000,000 Total Assets: $100,000,000 $80,000,000 Liabilities & Stockholders Equity All Current Liabilities combined $30,000,000 $25,000,000 All Long-Term Liabilities combined...
Calculator Ratio Improvement or Deterioration indicate if the ratio got better or worse from the prior...
Calculator Ratio Improvement or Deterioration indicate if the ratio got better or worse from the prior year Current Year Prior Year Better or Worse 1: Asset Turnover 4.1 3.1 Worse 12.0 79.0 75.0 9.0% 2 Price-Earnings Ratio 13.0 3 Number of Days' Sales in Inventory 4 Rate Earned on Stockholders Equity 7.0% 5 Ratio of Fixed Assets to Long-term Liabilities 2.1 6. Number of Days' Sales in Receivables 7 Number of Times Interest Charges Earned 6.2 3.1 35.0 40.0 8.2...
g 3. Given the balance sheet and income state for Simmons Maintenaethet Simmons & Professional Studies...
g 3. Given the balance sheet and income state for Simmons Maintenaethet Simmons & Professional Studies ratios that are also shown for the industry average. For each ratio,indica is better or worse than the industry average. For inventory turn cost of goods sold. Company, compute the use sales rather than SIMMONS MAINTENANCE COMPANY Assets Cash Acets. Receivable Inventory Current Assets Net Fixed Assets Liabilities S 15,000 Accounts Payable S 21,000 22,000 Notes Payable 20,000 30,000 Accrued Expenses 67,000 Current Liabilities...
The comparative financial statements prepared at December 31 for Pinnacle Plus showed the following summarized data:...
The comparative financial statements prepared at December 31 for Pinnacle Plus showed the following summarized data: Current Year Previous Year Income Statement Sales Revenue Cost of Goods Sold $125,000 58,000 $111,000 54,000 Gross Profit Operating Expenses Interest Expense 67,000 39,000 4,300 57,000 35,400 4.300 Income before Income Tax Expense Income Tax Expense (30%) 23,700 7,110 17,300 5,190 Net Income $ 16,590 $ 12,110 Balance Sheet Cash Accounts Receivable, Net Inventory Property and Equipment, Net $ 73,415 20,000 28,000 98,000 $...
Company X has net sales revenue of $1,256,000, cost of goods sold of $781,000, and all...
Company X has net sales revenue of $1,256,000, cost of goods sold of $781,000, and all other expenses of 304,000. The beginning balance of stockholders' equity is $545,000 and the beginning balance of fixed assets is $375,000. The ending balance of stockholders' equity is $950,000 and the ending balance of fixed assets is $403,000. Required: Compute the return on equity (ROE) ratio. (Round your answer to the nearest whole percent.) Return on Equity
Company X has net sales revenue of $1,254,000, cost of goods sold of $784,000, and all...
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Pinnacle Plus declared and paid a cash dividend of $8,100 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information:
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Required: 1. Compute the gross profit percentage in the current and previous years. Are the current...
Required: 1. Compute the gross profit percentage in the current and previous years. Are the current year results better, or worse, than those for the previous year? 2. Compute the net profit margin for the current and previous years. Are the current year results better, or worse, than those for the previous year? 3. Compute the earnings per share for the current and previous years. Are the current year results better, or worse, than those for the previous year? 4....
Pinnacle Plus declared and paid a cash dividend of $9,100 in the current year. Its comparative...
Pinnacle Plus declared and paid a cash dividend of $9,100 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information: Current Year Previous Year Income Statement Sales Revenue $ 235,000 $ 199,000 Cost of Goods Sold 102,000 98,000 Gross Profit 133,000 101,000 Operating Expenses 61,000 53,000 Interest Expense 6,500 6,500 Income before Income Tax Expense 65,500 41,500 Income Tax Expense (30%) 19,650 12,450 Net Income $ 45,850 $ 29,050 Balance Sheet Cash $...
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With this omission, the company's summary financial statements were stated as follows: Summarized Income Statement Sales $50,000,000 All Cost (incl. Interest & Taxes) $40,000,000 Net Income $10,000,000 Summarized Balance Sheet This Year Last Year Assets: All Current Assets combined $50,000,000 $40,000,000 All Long-Term Assets combined $50.000.000 _$40,000,000 Total Assets: $100,000,000 $80,000,000 Liabilities & Stockholders Equity All Current Liabilities combined $30,000,000 $25,000,000 All Long-Term Liabilities combined...
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g 3. Given the balance sheet and income state for Simmons Maintenaethet Simmons & Professional Studies ratios that are also shown for the industry average. For each ratio,indica is better or worse than the industry average. For inventory turn cost of goods sold. Company, compute the use sales rather than SIMMONS MAINTENANCE COMPANY Assets Cash Acets. Receivable Inventory Current Assets Net Fixed Assets Liabilities S 15,000 Accounts Payable S 21,000 22,000 Notes Payable 20,000 30,000 Accrued Expenses 67,000 Current Liabilities...
The comparative financial statements prepared at December 31 for Pinnacle Plus showed the following summarized data: Current Year Previous Year Income Statement Sales Revenue Cost of Goods Sold $125,000 58,000 $111,000 54,000 Gross Profit Operating Expenses Interest Expense 67,000 39,000 4,300 57,000 35,400 4.300 Income before Income Tax Expense Income Tax Expense (30%) 23,700 7,110 17,300 5,190 Net Income $ 16,590 $ 12,110 Balance Sheet Cash Accounts Receivable, Net Inventory Property and Equipment, Net $ 73,415 20,000 28,000 98,000 $...
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