Balance Sheet At December 31, 2012 Assets Liabilities and Equity $ 72 $60 Cash Accounts Receivable Merchandise Inventory Accounts Payable Bank Loan, non-current 88 150 100 Prepaid Expenses Property, Plant, and Equipment, at carrying amount Total Assets 40 Preferred Shares 60 Common Shares 250 Retained Earnings Total Liabilities and Equity 320 100 $620 $620 Salinas Limited Income Statement For the Year Ended December 31, 2012 Sales $240 Cost of Goods Sold Gross Profit 144 96 Operating Expenses Salaries $ 4 Depreciation 50 Income from Operations 46 Less: Interest Income before Income Taxes 38
Balance Sheet At December 31, 2012 Assets Liabilities and Equity $ 72 $60 Cash Accounts Receivable Merchandise Inventory Accounts Payable Bank Loan, non-current 88 150 100 Prepaid Expenses Property, Plant, and Equipment, at carrying amount Total Assets 40 Preferred Shares 60 Common Shares 250 Retained Earnings Total Liabilities and Equity 320 100 $620 $620 Salinas Limited Income Statement For the Year Ended December 31, 2012 Sales $240 Cost of Goods Sold Gross Profit 144 96 Operating Expenses Salaries $ 4 Depreciation 50 Income from Operations 46 Less: Interest Income before Income Taxes 38
Chapter3: Setting Up A New Company
Section: Chapter Questions
Problem 2.5C
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Q3- Consider the following information:
Salinas Limited
Balance Sheet
At December 31, 2012
Assets
Liabilities and Equity
Cash
$ 72
Accounts Payable
$ 60
Accounts Receivable
88
Bank Loan, non-current
150
Merchandise Inventory
Prepaid Expenses
Property, Plant, and Equipment,
at carrying amount
100
40
Preferred Shares
60
Common Shares
Retained Earnings
Total Liabilities and Equity
250
320
100
Total Assets
$620
$620
Salinas Limited
Income Statement
For the Year Ended December 31, 2012
Sales
$240
Cost of Goods Sold
144
Gross Profit
96
Operating Expenses
Salaries
$ 44
Depreciation
6.
50
Income from Operations
46
Less: Interest
8
Income before Income Taxes
38
Less: Income Taxes
18
Net Income
$ 20
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Q3- Consider the following information:
Salinas Limited
Balance Sheet
At December 31, 2012
Assets
Liabilities and Equity
Cash
$ 72
Accounts Payable
$ 60
Accounts Receivable
88
Bank Loan, non-current
150
Merchandise Inventory
Prepaid Expenses
Property, Plant, and Equipment,
at carrying amount
100
40
Preferred Shares
60
Common Shares
Retained Earnings
Total Liabilities and Equity
250
320
100
Total Assets
$620
$620
Salinas Limited
Income Statement
For the Year Ended December 31, 2012
Sales
$240
Cost of Goods Sold
144
Gross Profit
96
Operating Expenses
Salaries
$ 44
Depreciation
6.
50
Income from Operations
46
Less: Interest
8
Income before Income Taxes
38
Less: Income Taxes
18
Net Income
$ 20
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Assume that 80% of sales are on credit, that the average of all balance sheet items is equal to the
year-end figure, that all preferred share dividends have been paid and the total annual preferred
dividend entitlement is $6, and that the number of common shares outstanding is 10.
Required: Calculate the following ratios and percentages
a. Current ratio
b. Return on total assets
c. Sales to total assets
d. Acid-test ratio
e. Times interest earned
f. Earnings per common share
g. Accounts receivable collection period
h. Return on equity
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BIU - ab x,
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x A
- I vA -
E E E E
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I No Spac. Heading 1 Heading 2
Subtitle
Dictate
Title
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Assume that 80% of sales are on credit, that the average of all balance sheet items is equal to the
year-end figure, that all preferred share dividends have been paid and the total annual preferred
dividend entitlement is $6, and that the number of common shares outstanding is 10.
Required: Calculate the following ratios and percentages
a. Current ratio
b. Return on total assets
c. Sales to total assets
d. Acid-test ratio
e. Times interest earned
f. Earnings per common share
g. Accounts receivable collection period
h. Return on equity
Page 6 of 6
524 words
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100%
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2021-07-11
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