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Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to o decimal places, e.g. 15 and round all other answers to 1 decimal place, e.g. 15.5. Round % change to 0 decimal places, for e.g. 1% and if % change is a decrease showv the numbers as negative, e.g. -1% or (1%).) Situation 1. 20,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $55,000. Ratio Return on common stockholders' equity Debt to assets ratio 2. All of the notes payable were paid in 2023. All other liabilities remained at their December 31, 2022 levels. Total assets on December 31, 2023, were $877,000. 3. The market price of common stock was $9 and $12 on December 31, 2022 and 2023, respectively. Price-earmings ratio 2022 2023 % Change Return on common stockholders' equity

Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to o decimal places, e.g. 15 and round all other answers to 1 decimal place, e.g. 15.5. Round % change to 0 decimal places, for e.g. 1% and if % change is a decrease showv the numbers as negative, e.g. -1% or (1%).) Situation 1. 20,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $55,000. Ratio Return on common stockholders' equity Debt to assets ratio 2. All of the notes payable were paid in 2023. All other liabilities remained at their December 31, 2022 levels. Total assets on December 31, 2023, were $877,000. 3. The market price of common stock was $9 and $12 on December 31, 2022 and 2023, respectively. Price-earmings ratio 2022 2023 % Change Return on common stockholders' equity

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Please help me to calculate Return on common stockholders' equity ratio
Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to 0 decimal places, e.g. 15 and round all other answers to 1 decimal place, e.g. 15.5. Round % change to 0 decimal places, for e.g. 1% and if 90 change is a decrease show the numbers as negative, e.g. -1% or (19%).) Situation 1. 20,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $55,000. Ratio Return on common stockholders' equity 2. All of the notes payable were paid in 2023. All other liabilities remained at their December 31, 2022 levels. Total assets on December 31, 2023, were $977,000. Debt to assets ratio 3. The market price of common stock was $9 and $12 on December 31, 2022 and 2023, respectively. Price-earnings ratio 2022 2023 % Change Return on common stockholders' equity Debt to assets ratio Price earmings ratio times times
Transcribed Image Text:Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to 0 decimal places, e.g. 15 and round all other answers to 1 decimal place, e.g. 15.5. Round % change to 0 decimal places, for e.g. 1% and if 90 change is a decrease show the numbers as negative, e.g. -1% or (19%).) Situation 1. 20,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $55,000. Ratio Return on common stockholders' equity 2. All of the notes payable were paid in 2023. All other liabilities remained at their December 31, 2022 levels. Total assets on December 31, 2023, were $977,000. Debt to assets ratio 3. The market price of common stock was $9 and $12 on December 31, 2022 and 2023, respectively. Price-earnings ratio 2022 2023 % Change Return on common stockholders' equity Debt to assets ratio Price earmings ratio times times
The following financial information is for Cullumber Company. CULLUMBER COMPANY Balance Sheets December 31 Assets 2022 2021 Cash $ 72,000 $ 68,000 Debt investments (short-term) 51,000 42,000 Accounts receivable 109,000 92,000 Inventory 237,000 169,000 Prepaid expenses 28,000 25,000 Land 131,000 131,000 Building and equipment (net) 259,000 186,000 Total assets $887,000 $713,000 Liabilities and Stockholders' Equity Notes payable $169,000 $109,000 Accounts payable 69,000 50,000 Accrued liabilities 41,000 41,000 Bonds payable, due 2025 252,000 170,000 Common stock, $10 par 209,000 209,000 Retained earnings 147,000 134,000 Total liabilities and stockholders' equity $887,000 $713,000 CULLUMBER COMPANY Income Statements For the Years Ended December 31 2022 2021 Sales revenue $899,000 $789,000 Cost of goods sold 646,000 576,000 Gross profit 253,000 213,000 Operating expenses 192,000 159,000 Net income $ 61,000 $ 54,000 Additional information: 1. Inventory at the beginning of 2021 was $117,000. 2. Accounts receivable (net) at the beginning of 2021 were $90,000. 3. Total assets at the beginning of 2021 were $634,000. 4. No common stock transactions occurred during 2021 or 2022. 5. All sales were on account.
Transcribed Image Text:The following financial information is for Cullumber Company. CULLUMBER COMPANY Balance Sheets December 31 Assets 2022 2021 Cash $ 72,000 $ 68,000 Debt investments (short-term) 51,000 42,000 Accounts receivable 109,000 92,000 Inventory 237,000 169,000 Prepaid expenses 28,000 25,000 Land 131,000 131,000 Building and equipment (net) 259,000 186,000 Total assets $887,000 $713,000 Liabilities and Stockholders' Equity Notes payable $169,000 $109,000 Accounts payable 69,000 50,000 Accrued liabilities 41,000 41,000 Bonds payable, due 2025 252,000 170,000 Common stock, $10 par 209,000 209,000 Retained earnings 147,000 134,000 Total liabilities and stockholders' equity $887,000 $713,000 CULLUMBER COMPANY Income Statements For the Years Ended December 31 2022 2021 Sales revenue $899,000 $789,000 Cost of goods sold 646,000 576,000 Gross profit 253,000 213,000 Operating expenses 192,000 159,000 Net income $ 61,000 $ 54,000 Additional information: 1. Inventory at the beginning of 2021 was $117,000. 2. Accounts receivable (net) at the beginning of 2021 were $90,000. 3. Total assets at the beginning of 2021 were $634,000. 4. No common stock transactions occurred during 2021 or 2022. 5. All sales were on account.
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