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redmacaw454Lv1
28 Sep 2019
Measures of liquidity, Solvency and Profitability
The comparative financial statements of Marshall Inc. are asfollows. The market price of Marshall Inc. common stock was $ 71 onDecember 31, 20Y2.
Marshall Inc. Comparative Retained EarningsStatement For the Years Ended December 31, 20Y2 and20Y1 20Y2 20Y1 Retained earnings, January 1 $ 2,461,325 $ 2,069,975 Net income 570,000 424,000 Total $ 2,966,025 $ 2,493,975 Dividends On preferred stock $ 7,000 $ 7,000 On common stock 25,650 25,650 Total dividends $ 32,650 $ 32,650 Retained earnings, December 31 $ 2,998,675 $ 2,461,325
Marshall Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and20Y1 20Y2 20Y1 Sales $ 3,919,370 $ 3,611,160 Cost of goods sold 1,312,540 1,207,540 Gross profit $ 2,606,830 $ 2,403,620 Selling expenses $ 935,880 $ 1,140,250 Administrative expenses 797,240 669,670 Total operating expenses 1,733,120 1,809,920 Income from operations $ 873,710 $ 593,700 Other income 45,990 37,900 $ 919,700 $ 631,600 Other expense (interest) 272,000 149,600 Income before income tax $ 647,700 $ 482,000 Income tax expense 77,700 58,000 Net income $ 570,000 $ 424,000
Marshall Inc. Comparative Balance Sheet December 31, 20Y2 and 20Y1 Dec. 31,20Y2 Dec. 31,20Y1 Assets Current assets Cash $ 750,890 $ 607,950 Marketable securities 1,136,480 1,007,460 Accounts receivable (net) 686,200 642,400 Inventories 511,000 394,200 Prepaid expenses 142,059 121,590 Total current assets $ 3,226,629 $ 2,773,600 Long-term investments 897,589 13,273 Property, plant, and equipment (net) 4,420,000 3,978,000 Total assets $ 8,544,218 $ 6,764,873 Liabilities Current liabilities $ 1,075,543 $ 1,363,548 Long-term liabilities Mortgage note payable, 8 % $ 1,530,000 $ 0 Bonds payable, 8 % 1,870,000 1,870,000 Total long-term liabilities $ 3,400,000 $ 1,870,000 Total liabilities $ 4,475,543 $ 3,233,548 Stockholders' Equity Preferred $ 0.70 stock, $ 50 par $ 500,000 $ 500,000 Common stock, $ 10 par 570,000 570,000 Retained earnings 2,998,675 2,461,325 Total stockholders' equity $ 4,068,675 $ 3,531,325 Total liabilities and stockholders' equity $ 8,544,218 $ 6,764,873
Required:
Determine the following measures for 20Y2, rounding to onedecimal place, except for dollar amounts, which should be roundedto the nearest cent. Use the rounded answer of the requirement forsubsequent requirement, if required. Assume 365 days a year.
Return on stockholdersâ equity % Return on common stockholdersâ equity % Earnings per share on common stock $ Price-earnings ratio Dividends per share of common stock $ Dividend yield
Measures of liquidity, Solvency and Profitability
The comparative financial statements of Marshall Inc. are asfollows. The market price of Marshall Inc. common stock was $ 71 onDecember 31, 20Y2.
Marshall Inc. | ||||||
Comparative Retained EarningsStatement | ||||||
For the Years Ended December 31, 20Y2 and20Y1 | ||||||
20Y2 | 20Y1 | |||||
Retained earnings, January 1 | $ 2,461,325 | $ 2,069,975 | ||||
Net income | 570,000 | 424,000 | ||||
Total | $ 2,966,025 | $ 2,493,975 | ||||
Dividends | ||||||
On preferred stock | $ 7,000 | $ 7,000 | ||||
On common stock | 25,650 | 25,650 | ||||
Total dividends | $ 32,650 | $ 32,650 | ||||
Retained earnings, December 31 | $ 2,998,675 | $ 2,461,325 |
Marshall Inc. | ||||
Comparative Income Statement | ||||
For the Years Ended December 31, 20Y2 and20Y1 | ||||
20Y2 | 20Y1 | |||
Sales | $ 3,919,370 | $ 3,611,160 | ||
Cost of goods sold | 1,312,540 | 1,207,540 | ||
Gross profit | $ 2,606,830 | $ 2,403,620 | ||
Selling expenses | $ 935,880 | $ 1,140,250 | ||
Administrative expenses | 797,240 | 669,670 | ||
Total operating expenses | 1,733,120 | 1,809,920 | ||
Income from operations | $ 873,710 | $ 593,700 | ||
Other income | 45,990 | 37,900 | ||
$ 919,700 | $ 631,600 | |||
Other expense (interest) | 272,000 | 149,600 | ||
Income before income tax | $ 647,700 | $ 482,000 | ||
Income tax expense | 77,700 | 58,000 | ||
Net income | $ 570,000 | $ 424,000 |
Marshall Inc. | |||||||
Comparative Balance Sheet | |||||||
December 31, 20Y2 and 20Y1 | |||||||
Dec. 31,20Y2 | Dec. 31,20Y1 | ||||||
Assets | |||||||
Current assets | |||||||
Cash | $ 750,890 | $ 607,950 | |||||
Marketable securities | 1,136,480 | 1,007,460 | |||||
Accounts receivable (net) | 686,200 | 642,400 | |||||
Inventories | 511,000 | 394,200 | |||||
Prepaid expenses | 142,059 | 121,590 | |||||
Total current assets | $ 3,226,629 | $ 2,773,600 | |||||
Long-term investments | 897,589 | 13,273 | |||||
Property, plant, and equipment (net) | 4,420,000 | 3,978,000 | |||||
Total assets | $ 8,544,218 | $ 6,764,873 | |||||
Liabilities | |||||||
Current liabilities | $ 1,075,543 | $ 1,363,548 | |||||
Long-term liabilities | |||||||
Mortgage note payable, 8 % | $ 1,530,000 | $ 0 | |||||
Bonds payable, 8 % | 1,870,000 | 1,870,000 | |||||
Total long-term liabilities | $ 3,400,000 | $ 1,870,000 | |||||
Total liabilities | $ 4,475,543 | $ 3,233,548 | |||||
Stockholders' Equity | |||||||
Preferred $ 0.70 stock, $ 50 par | $ 500,000 | $ 500,000 | |||||
Common stock, $ 10 par | 570,000 | 570,000 | |||||
Retained earnings | 2,998,675 | 2,461,325 | |||||
Total stockholders' equity | $ 4,068,675 | $ 3,531,325 | |||||
Total liabilities and stockholders' equity | $ 8,544,218 | $ 6,764,873 |
Required:
Determine the following measures for 20Y2, rounding to onedecimal place, except for dollar amounts, which should be roundedto the nearest cent. Use the rounded answer of the requirement forsubsequent requirement, if required. Assume 365 days a year.
Return on stockholdersâ equity | % | |
Return on common stockholdersâ equity | % | |
Earnings per share on common stock | $ | |
Price-earnings ratio | ||
Dividends per share of common stock | $ | |
Dividend yield |
Nelly StrackeLv2
28 Sep 2019