KERSENBROCK CORPORATION Balance Sheets December 31 2011 2010 2009 $ 25,000 50,000 90,000 $ 20,000 45,000 95,000 70,000 370,000 $ 18,000 48,000 64,000 45,000 Cash Receivables (net) Other current assets Investments 75,000 Plant and equipment (net) 400,000 358,000 $533,000 $640,000 $ 75,000 80,000 340,000 145,000 $640,000 $600,000 $ 80,000 85,000 Current liabilities $ 70,000 Long-term debt Common stock, $10 par Retained earnings 50,000 310,000 125,000 $600,000 300,000 113,000 $533,000 KERSENBROCK CORPORATION Income Statement For the Year Ended December 31 2011 $740,000 40,000 2010 $700,000 50,000 650,000 Sales Less: Sales returns and allowances Net sales 700,000 420,000 Cost of goods sold 400,000 250,000 220,000 S 30,000 280,000 Gross profit Operating expenses (including income taxes) 235,000 $ 45,000 Net income Additional information: 1. The market price of Kersenbrock's common stock was $4.00, $5.00, and $8.00 for 2009, 2010, and 2011, respectively. 2. All dividends were paid in cash. Instructions (a) Compute the following ratios for 2010 and 2011. (1) Profit margin. (2) Asset turnover. (3) Earnings per share. (Weighted average common shares in 2011 were 32,000 and in 2010 were 31,000.) (4) Price-earnings. (5) Payout. (6) Debt to total assets.
KERSENBROCK CORPORATION Balance Sheets December 31 2011 2010 2009 $ 25,000 50,000 90,000 $ 20,000 45,000 95,000 70,000 370,000 $ 18,000 48,000 64,000 45,000 Cash Receivables (net) Other current assets Investments 75,000 Plant and equipment (net) 400,000 358,000 $533,000 $640,000 $ 75,000 80,000 340,000 145,000 $640,000 $600,000 $ 80,000 85,000 Current liabilities $ 70,000 Long-term debt Common stock, $10 par Retained earnings 50,000 310,000 125,000 $600,000 300,000 113,000 $533,000 KERSENBROCK CORPORATION Income Statement For the Year Ended December 31 2011 $740,000 40,000 2010 $700,000 50,000 650,000 Sales Less: Sales returns and allowances Net sales 700,000 420,000 Cost of goods sold 400,000 250,000 220,000 S 30,000 280,000 Gross profit Operating expenses (including income taxes) 235,000 $ 45,000 Net income Additional information: 1. The market price of Kersenbrock's common stock was $4.00, $5.00, and $8.00 for 2009, 2010, and 2011, respectively. 2. All dividends were paid in cash. Instructions (a) Compute the following ratios for 2010 and 2011. (1) Profit margin. (2) Asset turnover. (3) Earnings per share. (Weighted average common shares in 2011 were 32,000 and in 2010 were 31,000.) (4) Price-earnings. (5) Payout. (6) Debt to total assets.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Compute the following sub parts ratios for 2010 and 2011.
4) Price earnings
5) Payout
6) Debt to total assets
Transcribed Image Text:KERSENBROCK CORPORATION
Balance Sheets
December 31
2011
2010
2009
$ 25,000
$ 20,000
$ 18,000
Cash
Receivables (net)
Other current assets
50,000
45,000
48,000
90,000
95,000
64,000
Investments
75,000
70,000
45,000
Plant and equipment (net)
400,000
370,000
358,000
$640,000
$600,000
$ 80,000
85,000
$533,000
$ 75,000
$ 70,000
50,000
300,000
Current liabilities
Long-term debt
Common stock, $10 par
Retained earnings
80,000
340,000
310,000
145,000
125,000
113,000
$640,000
$600,000
$533,000
KERSENBROCK CORPORATION
Income Statement
For the Year Ended December 31
2011
2010
Sales
$740,000
$700,000
Less: Sales returns and allowances
40,000
50,000
Net sales
700,000
420,000
650,000
Cost of goods sold
400,000
250,000
Gross profit
Operating expenses (including income taxes)
280,000
235,000
220,000
$ 45,000
$ 30,000
Net income
Additional information:
1. The market price of Kersenbrock's common stock was $4.00 $5.00, and $8.00 for 2009, 2010,
and 2011, respectively.
2. All dividends were paid in cash.
Instructions
(a) Compute the following ratios for 2010 and 2011.
(1) Profit margin.
(2) Asset turnover.
(3) Earnings per share. (Weighted average common shares in 2011 were 32,000 and in 2010
were 31,000.)
(4) Price-earnings.
(5) Payout.
(6) Debt to total assets.
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