Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Current Year 1 Year Ago $ 34,600 $ 32,000 88,300 63,500 72,207 82,900 9,757 10,063 332,430 269,243 $ 535,000 $ 460,000 2 Years Ago $36,100 56,900 54,700 4,222 228,078 $ 380,000
Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Current Year 1 Year Ago $ 34,600 $ 32,000 88,300 63,500 72,207 82,900 9,757 10,063 332,430 269,243 $ 535,000 $ 460,000 2 Years Ago $36,100 56,900 54,700 4,222 228,078 $ 380,000
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 9BE
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Question
Can you do parts 1 to 3a thank you
![Simon Company's year-end balance sheets follow.
At December 31
Assets
Cash
Accounts receivable; net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Interest expense
Income tax expense
Total costs and expenses
Net income
Current Year
Earnings per share
$ 32,000
88,300
72,207
10,063
332,430
$ 535,000
$ 134,547
101,586
162,500
136,367
$ 535,000
Current Year
1 Year Ago 2 Years Ago
$ 424,255
215,605
11,824
9,042
$ 34,600
63,500
82,900
9,757
269,243
$ 460,000
The company's income statements for the Current Year and 1 Year Ago, follow.
For Year Ended December 31
Sales
Cost of goods sold
Other operating expenses
$ 77,740
104,742
162,500
115,018
$ 460,000
$ 695,500
660,726
$ 34,774
$ 2.14
Additional information about the company follows.
Common stock market price, December 31, Current Year
Common stock market price, December 31, 1 Year Ago
Annual cash dividends per share in Current Year
Annual cash dividends per share 1 Year Ago
For both the current year and one year ago, compute the following ratios:
$36,100
56,900
54,700
4,222
228,078
$ 380,000
$ 48,655
86,499
162,500
82,346
$ 380,000
$ 355,810
138,492
12,590
8,211
1 Year Ago
$31.00
29.00
0.32
0.16
$ 547,400
515,103
$ 32,297
$ 1.99](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F603fb863-551d-4e2c-baf1-38f56fb13d9e%2Fc34a0319-b2a6-42fa-92ac-b0f24a03b0fc%2Fmgj9cq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Simon Company's year-end balance sheets follow.
At December 31
Assets
Cash
Accounts receivable; net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Interest expense
Income tax expense
Total costs and expenses
Net income
Current Year
Earnings per share
$ 32,000
88,300
72,207
10,063
332,430
$ 535,000
$ 134,547
101,586
162,500
136,367
$ 535,000
Current Year
1 Year Ago 2 Years Ago
$ 424,255
215,605
11,824
9,042
$ 34,600
63,500
82,900
9,757
269,243
$ 460,000
The company's income statements for the Current Year and 1 Year Ago, follow.
For Year Ended December 31
Sales
Cost of goods sold
Other operating expenses
$ 77,740
104,742
162,500
115,018
$ 460,000
$ 695,500
660,726
$ 34,774
$ 2.14
Additional information about the company follows.
Common stock market price, December 31, Current Year
Common stock market price, December 31, 1 Year Ago
Annual cash dividends per share in Current Year
Annual cash dividends per share 1 Year Ago
For both the current year and one year ago, compute the following ratios:
$36,100
56,900
54,700
4,222
228,078
$ 380,000
$ 48,655
86,499
162,500
82,346
$ 380,000
$ 355,810
138,492
12,590
8,211
1 Year Ago
$31.00
29.00
0.32
0.16
$ 547,400
515,103
$ 32,297
$ 1.99
![For both the current year and one year ago, compute the following ratios:
1. Return on common stockholders' equity.
2. Dividend yield.
3. Price-earnings ratio on December 31.
3a. Assuming Simon's competitor has a price-earnings ratio of 8, which company has higher market expectations for fut
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3 Required 3a
Compute the return on common stockholders' equity for each year.
Current Year:
1 Year Ago:
Net income
$
$
Choose Numerator:
34,774
32,297
1
Return On Common Stockholders' Equity
-
Preferred dividends
/Choose Denominator:
Average common
stockholders' equity
1
0/
0/
< Required 1
$
11
535,000 =
Required 2 >
||
Return On Common
Stockholders' Equity
Return on common
stockholders' equity
6.5 %
0%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F603fb863-551d-4e2c-baf1-38f56fb13d9e%2Fc34a0319-b2a6-42fa-92ac-b0f24a03b0fc%2Fp14zaoc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:For both the current year and one year ago, compute the following ratios:
1. Return on common stockholders' equity.
2. Dividend yield.
3. Price-earnings ratio on December 31.
3a. Assuming Simon's competitor has a price-earnings ratio of 8, which company has higher market expectations for fut
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3 Required 3a
Compute the return on common stockholders' equity for each year.
Current Year:
1 Year Ago:
Net income
$
$
Choose Numerator:
34,774
32,297
1
Return On Common Stockholders' Equity
-
Preferred dividends
/Choose Denominator:
Average common
stockholders' equity
1
0/
0/
< Required 1
$
11
535,000 =
Required 2 >
||
Return On Common
Stockholders' Equity
Return on common
stockholders' equity
6.5 %
0%
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