Financial Statement Ratio Analysis The current year financial statements for two competitors are presented below. Please analyze their financials. Note: if a ratio cannot be solved given the data provided, please leave it blank. There are a few ratios that cannot be solved given the information provided. Balance sheet: Cash Accounts receivable (net) Inventory Property & equipment (net) Other assets Total assets Current liabilities. Long-term debt (interest rate: 15%) Capital stock ($10 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders' equity Income statement: Sales revenue (1/2 on credit) Cost of goods sold Operating expenses Net income Other data: Per share stock price at end of current year Average income tax rate Dividends declared and paid in current year Blue Water $ 41,100 38,500 98,500 141,500 84,100 $ 403,700 $ 98,500 65,700 148,700 29,100 61,700 $403,700 $ 445,500 (240,500) (161,200) $43,800 $ $ 33,100 22.1 45% Prime Fish $ 20,900 31,300 40,600 402,200 306,000 $801,000 $50,500 60,200 513,000 106, 100 71,200 $801,000 $ 801,000 (400,100) (311,100) $89,800 $ $ 148,500 16 45% Both companies are in the fish catching and manufacturing business. Both have been in business approximately 10 years, and each has had steady growth. The management of each has a different viewpoint in many respects. Blue Water is more conservative, and as its president has said, "We avoid what we consider to be undue risk." Neither company is publicly held. Required: 1. Complete a schedule that reflects a ratio analysis of each company. (Round your intermediate calculations and final answers to 2 decimal places. Enter percentage answers rounded to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)
Financial Statement Ratio Analysis The current year financial statements for two competitors are presented below. Please analyze their financials. Note: if a ratio cannot be solved given the data provided, please leave it blank. There are a few ratios that cannot be solved given the information provided. Balance sheet: Cash Accounts receivable (net) Inventory Property & equipment (net) Other assets Total assets Current liabilities. Long-term debt (interest rate: 15%) Capital stock ($10 par value) Additional paid-in capital Retained earnings Total liabilities and stockholders' equity Income statement: Sales revenue (1/2 on credit) Cost of goods sold Operating expenses Net income Other data: Per share stock price at end of current year Average income tax rate Dividends declared and paid in current year Blue Water $ 41,100 38,500 98,500 141,500 84,100 $ 403,700 $ 98,500 65,700 148,700 29,100 61,700 $403,700 $ 445,500 (240,500) (161,200) $43,800 $ $ 33,100 22.1 45% Prime Fish $ 20,900 31,300 40,600 402,200 306,000 $801,000 $50,500 60,200 513,000 106, 100 71,200 $801,000 $ 801,000 (400,100) (311,100) $89,800 $ $ 148,500 16 45% Both companies are in the fish catching and manufacturing business. Both have been in business approximately 10 years, and each has had steady growth. The management of each has a different viewpoint in many respects. Blue Water is more conservative, and as its president has said, "We avoid what we consider to be undue risk." Neither company is publicly held. Required: 1. Complete a schedule that reflects a ratio analysis of each company. (Round your intermediate calculations and final answers to 2 decimal places. Enter percentage answers rounded to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Financial Statement Ratio Analysis
The current year financial statements for two competitors are presented below. Please analyze their financials.
Note: if a ratio cannot be solved given the data provided, please leave it blank. There are a few ratios that cannot be solved given
the information provided.
Balance sheet:
Cash
Accounts receivable (net)
Inventory
Property & equipment (net)
Other assets
Total assets
Current liabilities
Long-term debt (interest rate: 15%)
Capital stock ($10 par value)
Additional paid-in capital
Retained earnings
Total liabilities and stockholders' equity
Income statement:
Sales revenue (1/2 on credit)
Cost of goods sold
Operating expenses
Net income
Other data:
Per share stock price at end of current year
Average income tax rate
Dividends declared and paid in current year
Profitability ratios:
1.
2.
3.
4.
5.
6.
Ratio
7.
8.
9.
Return on equity
Return on assets
Gross profit percentage
Net profit margin
Earnings per share
Quality of income
Asset turnover ratios:
Total asset turnover
Fixed asset turnover
Receivable turnover
X Answer is not complete.
BLUE WATER
COMPANY
75.64 X %
10.17X%
53.98
9.83
11.02 X
Blue Water
%
%
$ 41,100
38,500
98,500
Both companies are in the fish catching and manufacturing business. Both have been in business approximately 10 years, and each
has had steady growth. The management of each has a different viewpoint in many respects. Blue Water is more conservative, and as
its president has said, "We avoid what we consider to be undue risk." Neither company is publicly held.
141,500
84,100
$ 403,700
Required:
1. Complete a schedule that reflects a ratio analysis of each company. (Round your intermediate calculations and final answers to 2
decimal places. Enter percentage answers rounded to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)
98,500
65,700
148,700
29,100
61,700
$403,700
1.00
$ 445,500
(240,500)
(161,200)
$ 43,800
$
$ 33,100
22.1
45%
PRIME FISH
COMPANY
26.75 X %
%
11.200
50.06
11.20
%
%
Prime Fish
$ 20,900
31,300
40,600
402, 200
306,000
$ 801,000
$50,500
60,200
513,000
106, 100
71,200
$801,000
$ 801,000
(400, 100)
(311,100)
$ 89,800
$
16
45%
$ 148,500
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