Question 1 Jackson and Hudson Ltd. Income Statement For the year ended Dec. 31, 2013. $ Sales 600 000 Cost of Sales (460 000) Gross Profit 140 000 Less: Operating Expenses General and Admin. Exp. 30 000 Depreciation 30 000 ( 60 000) Operation Profit 80 000 Less Interest Expenses 10 000 Profit before tax 70 000 Corporation taxes ( 25 000) Profit after tax 45 000 Jackson and Hudson Ltd. Balance Sheet as at Dec. 31, 2010. $ $ Net Non-Current Assets 270 000 Current Assets Inventories 82 000 Accounts Receivable 34 100 Marketable Securities 7 200 Cash 15 000 138 300 Total Assets 408 300 Liability and Equities Long-Term Debt 150 000 Stockholders’ Equity Common Stock Equity (20 000 Shares) 110 200 Retained Earnings 73 100 183 300 Current Liabilities Accounts Payables 57 000 Notes Payables 13 000 Accruals 5 000 75 000 Total Liabilities and Equity 408 300 3 Ratio Industry average (2010) 1. Current ratio 2.35 2. Quick ratio .87 3. Inventory turnover 4.55
Question 1
Jackson and Hudson Ltd.
Income Statement
For the year ended Dec. 31, 2013.
$
Sales 600 000
Cost of Sales (460 000)
Gross Profit 140 000
Less: Operating Expenses
General and Admin. Exp. 30 000
Operation Profit 80 000
Less Interest Expenses 10 000
Profit before tax 70 000
Corporation taxes ( 25 000)
Profit after tax 45 000
Jackson and Hudson Ltd.
$ $
Net Non-Current Assets 270 000
Current Assets
Inventories 82 000
Marketable Securities 7 200
Cash 15 000 138 300
Total Assets 408 300
Liability and Equities
Long-Term Debt 150 000
Common Stock Equity (20 000 Shares) 110 200
183 300
Current Liabilities
Accounts Payables 57 000
Notes Payables 13 000
Accruals 5 000 75 000
Total Liabilities and Equity 408 300
3
Ratio Industry average (2010)
1.
2. Quick ratio .87
3. Inventory turnover 4.55
4. Average collection period 35.3 days
5. Total assets turnover 1.09
6. Debt –Equity .615
7. Time interest earned 12.3
8. Gross Profit Margin .202
9. Net Profit Margin .091
10. Return on total Assets .099
11. Return on Equity .167
12. Earnings per share $3.10
a. Calculate each of the above ratios for Jackson and Hudson Ltd
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