170,000 100,000 150,000 340,000 110,000 80,000 20,000 20,000 122,000 8,000 200,000 200,000 100,000 300,000 100,000 80,000 18,000 30,000 158,000 12,000
170,000 100,000 150,000 340,000 110,000 80,000 20,000 20,000 122,000 8,000 200,000 200,000 100,000 300,000 100,000 80,000 18,000 30,000 158,000 12,000
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 4PA: Measures of liquidity, solvency, and profitability The comparative financial statements of Marshall...
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![FINANCIAL STATEMENT ANALYSIS AND RATIO ANALYSIS
The following are the balance sheet and income statement data of PRT Company:
December 31
Balance Sheet Accounts
1997
1998
Cash
P30,000
P52,000
Marketable Securities
170,000
200,000
100,000
Accounts Receivable, net
Inventories
200,000
100,000
150,000
Machinery and Equipment, net
340,000
300,000
110,000
100,000
Land and Building, net
Goodwill
80,000
80,000
Deferred Charges
20,000
18,000
Notes Payable, Trade
20,000
30,000
122,000
158,000
Accounts Payable, Trade
Expenses Payable
8,000
12,000
450,000
500,000
Long-term Notes-Due 2008
15% Preferred Stock, P100 par
100,000
100,000
200,000
200,000
Common Stock, P10 par
Retained Earnings
50,000
100,000
1998 Income Statement Accounts
Sales
Sales Returns and Allowances
P1,050,000
50,000
100,000
Inventory, December 31, 1998
Inventory, December 31, 1997
150,000
Purchases
550,000
Selling Expenses
80,000
Administrative Expenses (including depreciation of P25,000)
120,000
Interest on Long-term Notes
50,000
Income Taxes, 35%
52,500
Additional Information:
1. Dividends paid on preferred stock
15,000
2. Dividends paid on common stock
32,500
18
3. Market price per share of common stock
6. Evaluate the firm's operational efficiency for 1998 by computing:
a. Gross Margin Ratio
b. Profit Margin Ratio
c. Return on Total Assets
d. Return on Owner's Equity
e. Asset Turnover Ratio
6](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa76275ba-7f3a-47a9-82e5-bcdd1b116825%2F79aa6633-5ab7-4b68-9c30-79d6463898de%2Ftac0w13_processed.png&w=3840&q=75)
Transcribed Image Text:FINANCIAL STATEMENT ANALYSIS AND RATIO ANALYSIS
The following are the balance sheet and income statement data of PRT Company:
December 31
Balance Sheet Accounts
1997
1998
Cash
P30,000
P52,000
Marketable Securities
170,000
200,000
100,000
Accounts Receivable, net
Inventories
200,000
100,000
150,000
Machinery and Equipment, net
340,000
300,000
110,000
100,000
Land and Building, net
Goodwill
80,000
80,000
Deferred Charges
20,000
18,000
Notes Payable, Trade
20,000
30,000
122,000
158,000
Accounts Payable, Trade
Expenses Payable
8,000
12,000
450,000
500,000
Long-term Notes-Due 2008
15% Preferred Stock, P100 par
100,000
100,000
200,000
200,000
Common Stock, P10 par
Retained Earnings
50,000
100,000
1998 Income Statement Accounts
Sales
Sales Returns and Allowances
P1,050,000
50,000
100,000
Inventory, December 31, 1998
Inventory, December 31, 1997
150,000
Purchases
550,000
Selling Expenses
80,000
Administrative Expenses (including depreciation of P25,000)
120,000
Interest on Long-term Notes
50,000
Income Taxes, 35%
52,500
Additional Information:
1. Dividends paid on preferred stock
15,000
2. Dividends paid on common stock
32,500
18
3. Market price per share of common stock
6. Evaluate the firm's operational efficiency for 1998 by computing:
a. Gross Margin Ratio
b. Profit Margin Ratio
c. Return on Total Assets
d. Return on Owner's Equity
e. Asset Turnover Ratio
6
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