Lamar Swimwear Income Statement 20X1 20X2 20X3 Sales (all on credit) $ 1,200,000 $ 1,500,000 $ 1,875,000 Cost of goods sold 800,000 1,040,000 1,310,000 Gross profit 400,000 460,000 565,000 Selling and admin. Expense 239,900 274,000 304,700 Operating profit (EBIT) 160,100 186,000 260,300 Interest expense 35,000 45,000 85,000 Net income before taxes 125,100 141,000 175,300 Taxes 36,900 49,200 55,600 Net income (EAT) $ 88,200 $ 91,800 $ 119,700 Shares of common stock outstanding 30,000 30,000 30,000 Earnings per share $ 2.94 $ 3.06 $ 3.99 Selling and Admin. Expense includes $15,000 per year lease payments Lamar Swimwear Balance Sheet 20X1 20X2 20X3 Assets Cash $ 30,000 $ 40,000 $ 30,000 Marketable securities 20,000 25,000 30,000 Accounts receivable 170,000 259,000 360,000 Inventory 230,000 261,000 290,000 Total current assets 450,000 585,000 710,000 Net plant and equipment 650,000 765,000 1,390,000 Total assets $ 1,100,000 $ 1,350,000 $ 2,100,000 Liabilities and Stockholders Equity Accounts payable $ 200,000 $ 310,000 $ 505,000 Accrued expenses 20,400 30,000 35,000 Total current liabilities 220,400 340,000 540,000 Long term liabilities 325,000 363,600 703,900 Total liabilities 545,400 703,600 1,243,900 Common stock - $2 par value 60,000 60,000 76,000 Capital paid in excess of par 190,000 190,000 264,000 Retained earnings 304,600 396,400 516,100 Total stockholders equity 554,600 646,400 856,100 Total liabilities and stockholders equity $ 1,100,000 $ 1,350,000 $ 2,100,000 Selected Industry Ratios 20X1 20X2 20X3 Growth in sales 10.0% 12.0% Profit margin 7.7% 7.8% 8.0% Return on assets (investment) 7.9% 8.9% 9.0% Return on equity 14.3% 15.3% 16.0% Receivable turnover (X ) - times 9.0 8.9 9.3 Inventory turnover (X) -times 4.2 5.1 5.1 Total asset turnover (X) times 1.1 1.1 1.1 Current ratio 2.0 2.3 2.4 Debt to total assets 43.5% 43.1% 44.1% Times interest earned (x) times 6.5 4.7 4.7 Growth in EPS N/A 4.7% 13.3% what is lamar ration? Lamar Ratios 20X1 20X2 20X3

Lamar Swimwear Income Statement 20X1 20X2 20X3 Sales (all on credit) $ 1,200,000 $ 1,500,000 $ 1,875,000 Cost of goods sold 800,000 1,040,000 1,310,000 Gross profit 400,000 460,000 565,000 Selling and admin. Expense 239,900 274,000 304,700 Operating profit (EBIT) 160,100 186,000 260,300 Interest expense 35,000 45,000 85,000 Net income before taxes 125,100 141,000 175,300 Taxes 36,900 49,200 55,600 Net income (EAT) $ 88,200 $ 91,800 $ 119,700 Shares of common stock outstanding 30,000 30,000 30,000 Earnings per share $ 2.94 $ 3.06 $ 3.99 Selling and Admin. Expense includes $15,000 per year lease payments Lamar Swimwear Balance Sheet 20X1 20X2 20X3 Assets Cash $ 30,000 $ 40,000 $ 30,000 Marketable securities 20,000 25,000 30,000 Accounts receivable 170,000 259,000 360,000 Inventory 230,000 261,000 290,000 Total current assets 450,000 585,000 710,000 Net plant and equipment 650,000 765,000 1,390,000 Total assets $ 1,100,000 $ 1,350,000 $ 2,100,000 Liabilities and Stockholders Equity Accounts payable $ 200,000 $ 310,000 $ 505,000 Accrued expenses 20,400 30,000 35,000 Total current liabilities 220,400 340,000 540,000 Long term liabilities 325,000 363,600 703,900 Total liabilities 545,400 703,600 1,243,900 Common stock - $2 par value 60,000 60,000 76,000 Capital paid in excess of par 190,000 190,000 264,000 Retained earnings 304,600 396,400 516,100 Total stockholders equity 554,600 646,400 856,100 Total liabilities and stockholders equity $ 1,100,000 $ 1,350,000 $ 2,100,000 Selected Industry Ratios 20X1 20X2 20X3 Growth in sales 10.0% 12.0% Profit margin 7.7% 7.8% 8.0% Return on assets (investment) 7.9% 8.9% 9.0% Return on equity 14.3% 15.3% 16.0% Receivable turnover (X ) - times 9.0 8.9 9.3 Inventory turnover (X) -times 4.2 5.1 5.1 Total asset turnover (X) times 1.1 1.1 1.1 Current ratio 2.0 2.3 2.4 Debt to total assets 43.5% 43.1% 44.1% Times interest earned (x) times 6.5 4.7 4.7 Growth in EPS N/A 4.7% 13.3% what is lamar ration? Lamar Ratios 20X1 20X2 20X3

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Lamar Swimwear
Income Statement

	20X1	20X2	20X3
Sales (all on credit)	$ 1,200,000	$ 1,500,000	$ 1,875,000
Cost of goods sold	800,000	1,040,000	1,310,000
Gross profit	400,000	460,000	565,000
Selling and admin. Expense	239,900	274,000	304,700
Operating profit (EBIT)	160,100	186,000	260,300
Interest expense	35,000	45,000	85,000
Net income before taxes	125,100	141,000	175,300
Taxes	36,900	49,200	55,600
Net income (EAT)	$ 88,200	$ 91,800	$ 119,700
Shares of common stock outstanding	30,000	30,000	30,000
Earnings per share	$ 2.94	$ 3.06	$ 3.99

Selling and Admin. Expense includes $15,000 per year lease payments

Lamar Swimwear
Balance Sheet

	20X1	20X2	20X3
Assets
Cash	$ 30,000	$ 40,000	$ 30,000
Marketable securities	20,000	25,000	30,000
Accounts receivable	170,000	259,000	360,000
Inventory	230,000	261,000	290,000
Total current assets	450,000	585,000	710,000
Net plant and equipment	650,000	765,000	1,390,000
Total assets	$ 1,100,000	$ 1,350,000	$ 2,100,000

Liabilities and Stockholders Equity
Accounts payable	$ 200,000	$ 310,000	$ 505,000
Accrued expenses	20,400	30,000	35,000
Total current liabilities	220,400	340,000	540,000
Long term liabilities	325,000	363,600	703,900
Total liabilities	545,400	703,600	1,243,900
Common stock - $2 par value	60,000	60,000	76,000
Capital paid in excess of par	190,000	190,000	264,000
Retained earnings	304,600	396,400	516,100
Total stockholders equity	554,600	646,400	856,100
Total liabilities and stockholders equity	$ 1,100,000	$ 1,350,000	$ 2,100,000

Selected Industry Ratios

	20X1	20X2	20X3
Growth in sales		10.0%	12.0%
Profit margin	7.7%	7.8%	8.0%
Return on assets (investment)	7.9%	8.9%	9.0%
Return on equity	14.3%	15.3%	16.0%
Receivable turnover (X ) - times	9.0	8.9	9.3
Inventory turnover (X) -times	4.2	5.1	5.1
Total asset turnover (X) times	1.1	1.1	1.1
Current ratio	2.0	2.3	2.4
Debt to total assets	43.5%	43.1%	44.1%
Times interest earned (x) times	6.5	4.7	4.7
Growth in EPS	N/A	4.7%	13.3%

what is lamar ration?

Lamar Ratios

20X1	20X2	20X3

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