Measures of liquidity, Solvency and Profitability
The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall Inc. common stock was $ 52 on December 31, 20Y2.
Marshall Inc.
Comparative Retained Earnings Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2 20Y1
Retained earnings, January 1 $ 3,512,150 $ 2,956,150
Net income 745,200 605,500
Total $ 4,257,350 $ 3,561,650
Dividends
On preferred stock $ 12,600 $ 12,600
On common stock 36,900 36,900
Total dividends $ 49,500 $ 49,500
Retained earnings, December 31 $ 4,207,850 $ 3,512,150
Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2 20Y1
Sales $ 4,316,490 $ 3,976,970
Cost of goods sold 1,553,440 1,429,160
Gross profit $ 2,763,0 $ 2,547,810
Selling expenses $ 914,000 $ 1,106,250
Administrative expens 778,590 649,700
Total operating expenses 1,692,590 1,755,950
Income from operations $ 1,070,460 $ 791,860
Other income 56,340 50,540
$ 1,126,800 $ 842,400
Other expense (interest) 280,000 154,400
Income before income tax $ 846,800 $ 688,000
Income tax expense 101,600 82,500
Net income $ 745,200 $ 605,500
Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
Dec. 31, 20Y2 Dec. 31, 20Y1
Assets
Current assets
Cash $ 762,860 $ 726,610
Marketable securities 1,154,610 1,204,110
Accounts receivable (net) 824,900 773,800
Inventories 627,800 481,800
Prepaid expenses 144,326 145,320
Total current assets $ 3,514,496 $ 3,331,640
Long-term investments 2,281,634 699,302
Property, plant, and
equipment (net) 4,550,000 4,095,000
Total assets $ 10,346,130 $ 8,125,942
Liabilities
Current liabilities $ 1,098,280 $ 1,143,792
Long-term liabilities
Mortgage note payable,
8 % $ 1,570,000 $ 0
Bonds payable, 8 % 1,930,000 1,930,000
Total long-term liabilities$ 3,500,000 $ 1,930,000
Total liabilities $ 4,598,280 $ 3,073,792
Stockholders' Equity
Preferred $
0.70 stock, $ 40 par $ 720,000 $ 720,000
Common stock, $ 10 par 820,000 820,000
Retained earnings 4,207,850 3,512,150
Total stockholders' equity$ 5,747,850 $ 5,052,150
Total liabilities and
stockholders' equity $ 10,346,130 $ 8,125,942
Required:
Determine the following measures for 20Y2, rounding to one decimal place, except for dollar amounts, which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.
1. Working capital $
2. Current ratio
3. Quick ratio
4. Accounts receivable turnover
5. Number of days' sales in receivables days
6. Inventory turnover
7. Number of days' sales in inventory days
8. Ratio of fixed assets to long-term liabilities
9. Ratio of liabilities to stockholders' equity
10. Times interest earned
11. Asset turnover
12. Return on total assets %
13. Return on stockholders’ equity %
14. Return on common stockholders’ equity %
15. Earnings per share on common stock $
16. Price-earnings ratio
17. Dividends per share of common stock $
18. Dividend yield