Question

Measures of liquidity, Solvency and Profitability

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 62 on December 31, 20Y2.

Marshall Inc.
Comparative Retained Earnings Statement
For the Years Ended December 31, 20Y2 and 20Y1
			20Y2		20Y1
Retained earnings, January 1			$ 2,842,400		$ 2,417,000
Net income			624,800		495,000
Total			$3,467,200		$ 2,912,000
Dividends:
	On preferred stock		$ 8,400		$ 8,400
	On common stock		61,200		61,200
		Total dividends	$ 69,600		$ 69,600
Retained earnings, December 31			$ 3,397,600		$ 2,842,400

Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
	20Y2		20Y1
Sales	$ 4,062,450		$ 3,742,900
Cost of goods sold	1,554,900		1,430,510
Gross profit	$ 2,507,550		$ 2,312,390
Selling expenses	$ 829,790		$ 1,021,540
Administrative expenses	706,860		599,950
Total operating expenses	1,536,650		1,621,490
Income from operations	$ 970,900		$ 690,900
Other revenue	51,100		44,100
	$ 1,022,000		$ 735,000
Other expense (interest)	312,000		172,000
Income before income tax	$ 710,000		$ 563,000
Income tax expense	85,200		68,000
Net income	$ 624,800		$ 495,000

Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
			Dec. 31, 20Y2		Dec. 31, 20Y1
Assets
Current assets
	Cash		$ 828,480		$ 529,820
	Marketable securities		1,253,920		877,990
	Accounts receivable (net)		788,400		744,600
	Inventories		584,000		452,600
	Prepaid expenses		156,744		105,960
		Total current assets	$ 3,611,544		$ 2,710,970
Long-term investments			1,921,416		40,158
Property, plant, and equipment (net)			4,290,000		3,861,000
Total assets			$ 9,822,960		$ 6,612,128
Liabilities
Current liabilities			$ 1,245,360		$ 339,728
Long-term liabilities
	Mortgage note payable, 8 %		$ 1,750,000		$ 0
	Bonds payable, 8 %		2,150,000		2,150,000
		Total long-term liabilities	$ 3,900,000		$ 2,150,000
Total liabilities			$ 5,145,360		$ 2,489,728
Stockholders' Equity
Preferred $ 0.70 stock, $ 50 par			$ 600,000		$ 600,000
Common stock, $ 10 par			680,000		680,000
Retained earnings			3,397,600		2,842,400
Total stockholders' equity			$ 4,677,600		$ 4,122,400
Total liabilities and stockholders' equity			$ 9,822,960		$ 6,612,128

Required:

Determine the following measures for 20Y2, rounding to one decimal place, except for dollar amounts, which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.

1. Working capital	$
2. Current ratio
3. Quick ratio
4. Accounts receivable turnover
5. Number of days' sales in receivables		days
6. Inventory turnover
7. Number of days' sales in inventory		days
8. Ratio of fixed assets to long-term liabilities
9. Ratio of liabilities to stockholders' equity
10. Times interest earned
11. Asset turnover
12. Return on total assets		%
13. Return on stockholders’ equity		%
14. Return on common stockholders’ equity		%
15. Earnings per share on common stock	$
16. Price-earnings ratio
17. Dividends per share of common stock	$
18. Dividend yield		%

Answer 1

I have answered only first 4 subparts as per HOMEWORKLIB RULES

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