Financial statements for Rundle Company follow. Assets Current assets. Cash Marketable securities Accounts receivable (net) Inventories Prepaid items Total current assets Investments Plant (net) Land Total assets Liabilities and Stockholders' Equity Liabilities Current liabilities Notes payable Accounts payable Salaries payable Total current liabilities Noncurrent liabilities Bonds payable Other RUNDLE COMPANY Balance Sheets As of December 31 Total noncurrent liabilities Total liabilities Stockholders' equity Preferred stock, (par value $10, 4% cumulative, non-participating; 7,000 shares authorized and issued) Common stock (no par; 50,000 shares authorized; 10,000 shares issued) Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Year 4 $ 22,000 21,200 53,000 138,000 27,000 261,200 27,000 270,000 30,000 $588, 200 $ 31,800 133,800 21,000 186,600 100,000 27,000 127,000 313,600 70,000 70,000 134,600 274,600 $588,200 Year 3 $ 18,000 7,200 45,000 146,000 12,000 228, 200 20,000 255,000 25,000 $528,200 $ 13,500 120,000 15,000 148,500 100,000 22,000 122,000 270,500 70,000 70,000 117,700 257,700 $528, 200 Required Calculate the following ratios for Year 4 and Year 3. a. Working capital. b. Current ratio. (Round your answers to 2 decimal places.) c. Quick ratio. (Round your answers to 2 decimal places.) d. Receivables turnover (beginning receivables at January 1, Year 3, were $46,000). (Round your answers to 2 decimal places.) e. Average days to collect accounts receivable. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) f. Inventory turnover (beginning inventory at January 1, Year 3, was $152,000). (Round your answers to 2 decimal places.) g. Number of days to sell inventory. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) h. Debt-to-assets ratio. (Round your answers to the nearest whole percent.) i. Debt-to-equity ratio. (Round your answers to 2 decimal places.) j. Number of times interest was earned. (Round your answers to 2 decimal places.) k. Plant assets to long-term debt. (Round your answers to 2 decimal places.) 1. Net margin. (Round your answers to 2 decimal places.) m. Turnover of assets (average total assets in Year 3 is $528,200). (Round your answers to 2 decimal places.) n. Return on investment (average total assets in Year 3 is $528,200). (Round your answers to 2 decimal places.) o. Return on equity (average stockholders' equity in Year 3 is $257,700). (Round your answers to 2 decimal places.) p. Earnings per share (total shares outstanding is unchanged). (Round your answers to 2 decimal places.) q. Book value per share of common stock. (Round your answers to 2 decimal places.) r. Price-earnings ratio (market price per share: Year 3, $12.35; Year 4, $13.70). (Round your intermediate calculations and final answer to 2 decimal places.) s. Dividend yield on common stock. (Round your answers to 2 decimal places.)
Financial statements for Rundle Company follow. Assets Current assets. Cash Marketable securities Accounts receivable (net) Inventories Prepaid items Total current assets Investments Plant (net) Land Total assets Liabilities and Stockholders' Equity Liabilities Current liabilities Notes payable Accounts payable Salaries payable Total current liabilities Noncurrent liabilities Bonds payable Other RUNDLE COMPANY Balance Sheets As of December 31 Total noncurrent liabilities Total liabilities Stockholders' equity Preferred stock, (par value $10, 4% cumulative, non-participating; 7,000 shares authorized and issued) Common stock (no par; 50,000 shares authorized; 10,000 shares issued) Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Year 4 $ 22,000 21,200 53,000 138,000 27,000 261,200 27,000 270,000 30,000 $588, 200 $ 31,800 133,800 21,000 186,600 100,000 27,000 127,000 313,600 70,000 70,000 134,600 274,600 $588,200 Year 3 $ 18,000 7,200 45,000 146,000 12,000 228, 200 20,000 255,000 25,000 $528,200 $ 13,500 120,000 15,000 148,500 100,000 22,000 122,000 270,500 70,000 70,000 117,700 257,700 $528, 200 Required Calculate the following ratios for Year 4 and Year 3. a. Working capital. b. Current ratio. (Round your answers to 2 decimal places.) c. Quick ratio. (Round your answers to 2 decimal places.) d. Receivables turnover (beginning receivables at January 1, Year 3, were $46,000). (Round your answers to 2 decimal places.) e. Average days to collect accounts receivable. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) f. Inventory turnover (beginning inventory at January 1, Year 3, was $152,000). (Round your answers to 2 decimal places.) g. Number of days to sell inventory. (Use 365 days in a year. Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) h. Debt-to-assets ratio. (Round your answers to the nearest whole percent.) i. Debt-to-equity ratio. (Round your answers to 2 decimal places.) j. Number of times interest was earned. (Round your answers to 2 decimal places.) k. Plant assets to long-term debt. (Round your answers to 2 decimal places.) 1. Net margin. (Round your answers to 2 decimal places.) m. Turnover of assets (average total assets in Year 3 is $528,200). (Round your answers to 2 decimal places.) n. Return on investment (average total assets in Year 3 is $528,200). (Round your answers to 2 decimal places.) o. Return on equity (average stockholders' equity in Year 3 is $257,700). (Round your answers to 2 decimal places.) p. Earnings per share (total shares outstanding is unchanged). (Round your answers to 2 decimal places.) q. Book value per share of common stock. (Round your answers to 2 decimal places.) r. Price-earnings ratio (market price per share: Year 3, $12.35; Year 4, $13.70). (Round your intermediate calculations and final answer to 2 decimal places.) s. Dividend yield on common stock. (Round your answers to 2 decimal places.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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