Homework Answers
| 2019 | 2020 | |
| LIQUIDITY | ||
| Current ratio | 1.81 | 1.76 |
| Accounts receivable turnover | 9.0 times | 9.1 times |
| Inventory turnover | 4.1 times | 3.2 times |
| PROFITABILITY | ||
| Profit margin | 6.1% | 5.9% |
| Assets turnover | 1.16 times | 1.12 times |
| Return on assets | 7.1 times | 6.6 times |
| EPS | $2.40 | $2.60 |
1. Current ratio = Current assets/ Current Liabilities
2019 =($126,100+$77,600+$174,600+$320,100+$44,620)/($232,800+$100,800+$77,600)
=$743,020/$411,200
=1.81
2020 =($135,800+$106,700+$201,760+$446,200+$48,500)/($329,800+$126,100+$77,600)
=$938,960/$533,500
=1.76
2. Accounts receivable turnover = Sales / Average receivable
2019 =$1,532,600/[($166,840+$174,600)/2]
=$1,532,600/$170,720
=9.0 times
2020 =$1,711,080/[($201,760+$174,600)/2]
=$1,711,080/$188,180
=9.1 times
3. Inventory turnover = Cost of goods sold/ Average inventory
2019 =$1,115,500/[($223,100+$320,100)/2]
=$1,115,200/$271,600
=4.1 times
2020 =$1,241,600/[($446,200+$320,100)/2]
=$1,241,600/$383,150
=3.2 times
4. Profit margin = Net profit/ Sales
2019 =$93,120/$1,532,600
=6.1%
2020 =$100,880/$1,711,080
=5.9 times
5. Assets turnover = Sales / Average assets
2019 =$1,532,600/[($1,280,400+$1,354,120)/2] =$1,532,600/$1,317,260 =1.16 times
2020 =$1,711,080/[($1,695,560+$1,354,120)/2] =$1,711,080/$1,524,840 =1.12 times
6. Return on assets = Net income/ Average assets
2019 =$93,120/$1,317,260 =7.1 times
2020 =$100,880/$1,524,840 =6.6 times
7. Earnings per share = Net income/ Outstanding shares
2019 =$93,120/38,800 = $2.40
2020 =$100,880/38,800 =$2.60
| 2020 | 2021 | Change | |
| Return on common stockholders equity | 15.6% | 11.56% | (26%) |
| Debt to assets ratio | 60% | 39% | (35%) |
| Price Earnings ratio | 6.5 | 8.51 | 31% |
Working notes:
Return on common stockholders equity = Net income/ Average equity
2020 =$100,800/[($388,000+$289,060+$388,000+$225,040)/2]
=$100,800/$645,050
=15.6%
2021 =$104,760/[($388,000+$289,060+$388,000+(34,920×$10)+$289,060+$104,760)/2]
=$104,760/$904,040
=11.56%
Debt to assets ratio = Total liabilities/ Total assets
2020 =($329,800+$126,100+$77,600+$485,00)/$1,695,560
=60%
2021 =($126,100+$77,600+$485,000)/$1,746,000
=39%
Price Earnings ratio = Market price/ EPS
2020 =$17/$2.6 =6.5 times
2021 =$23/($104,760/34,920)
=$23/$2.7
=8.51 times
______×______
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The following financial information is for Priscoll Company. The following financial information is for Priscoll Company....
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check if the second answer correct
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The following financial information is for Priscoll Company.
The following financial information is for Priscoll Company. 2019 $ 71,500 44,000 99,000 181,500 25,300 Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 77,000 Debt investments (short-term) 60,500 Accounts receivable 114,400 Inventory 253,000 Prepaid expenses 27,500 Land 143,000 Building and equipment (net) 286,000 Total assets $961,400 Liabilities and Stockholders' Equity Notes payable (short-term) $187,000 Accounts payable 71,500 Accrued liabilities 44,000 Bonds payable, due 2023 275,000 Common stock, $10 par 220,000...
The following financial information is for Priscoll Company. Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 84,700 Debt investments (short-term) 66,550 Accounts receivable 125,840 Inventory 278,300 Prepaid expenses 30,250 Land 157,300 Building and equipment (net) 314,600 Total assets $1,057,540 Liabilities and Stockholders' Equity Notes payable (short-term) $205,700 Accounts payable 78,650 Accrued liabilities 48,400 Bonds payable, due 2023 302,500 Common stock, $10 par 242,000 Retained earnings 180,290 Total liabilities and stockholders' equity $1,057,540 2019 $78,650 48,400 108,900 199,650 27,830...
check if the second answer correct
The following financial information is for Priscoll Company. Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 115,500 Debt investments (short-term) 90,750 Accounts receivable 171,600 Inventory 379,500 Prepaid expenses 41,250 Land 214,500 Building and equipment (net) 429,000 Total assets $1,442,100 Liabilities and Stockholders' Equity Notes payable (short-term) $280,500 Accounts payable 107,250 Accrued liabilities 66,000 Bonds payable, due 2023 412,500 Common stock, $10 par 330,000 Retained earnings 245,850 Total liabilities and stockholders' equity $1,442,100...
2019 Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 136,500 Debt investments (short-term) 107,250 Accounts receivable 202,800 Inventory 448,500 Prepaid expenses 48,750 Land 253,500 Building and equipment (net) 507,000 Total assets $1,704,300 Liabilities and Stockholders' Equity Notes payable (short-term) $331,500 Accounts payable 126,750 Accrued liabilities 78,000 Bonds payable, due 2023 487,500 Common stock, $10 par 390,000 Retained earnings 290,550 Total liabilities and stockholders' equity $1,704,300 $ 126,750 78,000 175,500 321,750 44,850 253,500 360,750 $1,361,100 $234,000 101,400 78,000 331,500...
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