281
276) Medina Corporation has provided the following financial data:
Balance Sheet
December 31, Year 2 and Year 1
Assets
Year 2
Year 1
Current assets:
Cash
$
271,000
$
Accounts receivable, net
215,000
Inventory
117,000
Prepaid expenses
25,000
Total current assets
628,000
Plant and equipment, net
726,000
Total assets
$
1,354,000
$
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable
$
198,000
$
Accrued liabilities
58,000
Notes payable, short term
102,000
Total current liabilities
358,000
Bonds payable
140,000
Total liabilities
498,000
Stockholders’ equity:
Common stock, $5 par value
500,000
Additional paid-in capital
80,000
Retained earnings
276,000
Total stockholders’ equity
856,000
Total liabilities & stockholders’ equity
$
1,354,000
$
282
Income Statement
For the Year Ended December 31, Year 2
Sales (all on account)
$
1,280,000
Cost of goods sold
840,000
Gross margin
440,000
Operating expenses
413,692
Net operating income
26,308
Interest expense
14,000
Net income before taxes
12,308
Income taxes (35%)
4,308
Net income
$
8,000
Dividends on common stock during Year 2 totaled $2,000. The market price of common stock at
the end of Year 2 was $1.49 per share.
Required:
a. What is the company’s times interest earned ratio for Year 2?
b. What is the company’s debt-to-equity ratio at the end of Year 2?
c. What is the company’s equity multiplier at the end of Year 2?
d. What is the company’s net profit margin percentage for Year 2?
e. What is the company’s gross margin percentage for Year 2?
f. What is the company’s return on total assets for Year 2?
g. What is the company’s return on equity for Year 2?
h. What is the company’s earnings per share for Year 2?
i. What is the company’s price-earnings ratio for Year 2?
j. What is the company’s dividend payout ratio for Year 2?
k. What is the company’s dividend yield ratio for Year 2?
l. What is the company’s book value per share at the end of Year 2?
g.
286
277) Tobia Corporation has provided the following financial data:
Balance Sheet
December 31, Year 2 and Year 1
Assets
Year 2
Year 1
Current assets:
Cash
$
201,000
$
Accounts receivable, net
236,000
Inventory
158,000
Prepaid expenses
96,000
Total current assets
691,000
Plant and equipment, net
842,000
Total assets
$
1,533,000
$
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable
$
173,000
$
Accrued liabilities
36,000
Notes payable, short term
88,000
Total current liabilities
297,000
Bonds payable
170,000
Total liabilities
467,000
Stockholders’ equity:
Common stock, $3 par value
210,000
Additional paid-in capital
60,000
Retained earnings
796,000
Total stockholders’ equity
1,066,000
Total liabilities & stockholders’ equity
$
1,533,000
$
287
Income Statement
For the Year Ended December 31, Year 2
Sales (all on account)
$
1,410,000
Cost of goods sold
850,000
Gross margin
560,000
Operating expenses
525,077
Net operating income
34,923
Interest expense
16,000
Net income before taxes
18,923
Income taxes (35%)
6,623
Net income
$
12,300
Dividends on common stock during Year 2 totaled $6,300. The market price of common stock at
the end of Year 2 was $1.78 per share.
Required:
a. What is the company’s times interest earned ratio for Year 2?
b. What is the company’s debt-to-equity ratio at the end of Year 2?
c. What is the company’s equity multiplier at the end of Year 2?
d. What is thecompany’s earnings per share for Year 2?
e. What is the company’s price-earnings ratio for Year 2?
f. What is thecompany’s dividend payout ratio for Year 2?
g. What is thecompany’s dividend yield ratio for Year 2?
h. What is the company’s book value per share at the end of Year 2?
f.
290
278) Vogelsberg Corporation has provided the following financial data:
Year 2
Year 1
Total assets
$
1,286,000
$
Total liabilities
$
356,000
$
Stockholders’ equity:
Common stock, $3 par value
$
270,000
$
Additional paid-in capital
90,000
Retained earnings
570,000
Total stockholders’ equity
$
930,000
$
The company’s net operating income in Year 2 was $62,308; its interest expense was $12,000; and
its net income was $32,700. Dividends on common stock during Year 2 totaled $2,700. The market
price of common stock at the end of Year 2 was $6.37 per share.
Required:
a. What is the company’s times interest earned ratio for Year 2?
b. What is the company’s debt-to-equity ratio at the end of Year 2?
c. What is the company’s equity multiplier at the end of Year 2?
d. What is thecompany’s earnings per share for Year 2?
e. What is the company’s price-earnings ratio for Year 2?
f. What is thecompany’s dividend payout ratio for Year 2?
g. What is thecompany’s dividend yield ratio for Year 2?
h. What is the company’s book value per share at the end of Year 2?
f.
293
279) Remley Corporation has provided the following financial data:
Year 2
Year 1
Total assets
$
1,441,000
$
Total liabilities
$
539,000
$
Stockholders’ equity:
Common stock, $3 par value
$
180,000
$
Additional paid-in capital
90,000
Retained earnings
632,000
Total stockholders’ equity
$
902,000
$
Income Statement
For the Year Ended December 31, Year 2
Sales (all on account)
$
1,360,000
Cost of goods sold
840,000
Gross margin
520,000
Operating expenses
480,923
Net operating income
39,077
Interest expense
16,000
Net income before taxes
23,077
Income taxes (35%)
8,077
Net income
$
15,000
Dividends on common stock during Year 2 totaled $3,000. The market price of common stock at
the end of Year 2 was $2.70 per share.
Required:
a. What is the company’s times interest earned ratio for Year 2?
b. What is the company’s debt-to-equity ratio at the end of Year 2?
c. What is the company’s equity multiplier at the end of Year 2?
d. What is the company’s earnings per share for Year 2?
e. What is the company’s price-earnings ratio for Year 2?
f. What is the company’s dividend payout ratio for Year 2?
g. What is the company’s dividend yield ratio for Year 2?
h. What is the company’s book value per share at the end of Year 2?
296
280) Pribyl Corporation has provided the following financial data:
Year 2
Year 1
Total assets
$
1,476,000
$
Total stockholders’ equity
$
1,013,000
$
Income Statement
For the Year Ended December 31, Year 2
Sales (all on account)
$
1,270,000
Cost of goods sold
720,000
Gross margin
550,000
Operating expenses
506,846
Net operating income
43,154
Interest expense
17,000
Net income before taxes
26,154
Income taxes (35%)
9,154
Net income
$
17,000
Required:
a. What is the company’s net profit margin percentage for Year 2?
b. What is the company’s gross margin percentage for Year 2?
c. What is the company’s return on total assets for Year 2?
d. What is the company’s return on equity for Year 2?
281) Perrett Corporation has provided the following financial data:
Year 2
Year 1
Total assets
$
1,470,000
$
Total stockholders’ equity
$
954,000
$
Sales (all on account)
$
1,200,000
Gross margin
$
430,000
Interest expense
$
22,000
Income taxes (35%)
$
21,269
Net income
$
39,500
Required:
a. What is the company’s net profit margin percentage for Year 2?
b. What is the company’s gross margin percentage for Year 2?
c. What is the company’s return on total assets for Year 2?
d. What is the company’s return on equity for Year 2?
282) Jepson Corporation’s most recent income statement appears below:
Sales (all on account)
$
865,000
Cost of goods sold
358,000
Gross margin
507,000
Selling and administrative expense
213,000
Net operating income
294,000
Interest expense
48,000
Net income before taxes
246,000
Income taxes
70,000
Net income
$
176,000
Required:
Compute the gross margin percentage.