(SanjuIchi) Can you Help me with This Question? Thank you ! The following financ

Question

(SanjuIchi)

Can you Help me with This Question? Thank you !

The following financial statements apply to Karl Company:

Required

Calculate the following ratios for 2018 and 2019. Since 2017 numbers are not presented, do not use averages when calculating the ratios for 2018. Instead, use the number presented on the 2018 balance sheet.

E). Price-earnings ratio (market prices at the end of 2018 and 2019 were $11.88 and $9.54, respectively). (Round your intermediate calculations and final answers to 2 decimal places.)

F.)Book value per share of common stock. (Round your answers to 2 decimal places.)

G.)Times interest earned. Exclude extraordinary income in the calculation as they cannot be expected to recur and, therefore, will not be available to satisfy future interest payments. (Round your answers to 2 decimal places.)

H.)Working capital.

I.)Current ratio. (Round your answers to 2 decimal places.)

J.)Quick (acid-test) ratio. (Round your answers to 2 decimal places.)

K.)Accounts receivable turnover. (Round your answers to 2 decimal places.)

L). Inventory turnover. (Round your answers to 2 decimal places.)

M.)Debt to equity ratio. (Round your answers to 2 decimal places.)

N). Debt to assets ratio. (Round your answers to the nearest whole percent.)

2019 2018 Revenues Net sales $ 420,000 $ 350,000 Other revenues 16,000 10,000 Total revenues 436,000 360,000 Expenses Cost of goods sold 252,000 206,000 Selling expenses 42,000 38,000 General and administrative expenses 22,000 20,000 Interest expense 6,000 6,000 Income tax expense 42,000 36,000 Total expenses 364,000 306,000 Net income $ 72,000 $ 54,000 Assets Current assets Cash $ 8,000 $ 16,000 Marketable securities 2,000 2,000 Accounts receivable 70,000 64,000 Inventories 200,000 192,000 Prepaid expenses 6,000 4,000 Total current assets 286,000 278,000 Plant and equipment (net) 210,000 210,000 Intangibles 40,000 0 Total assets $ 536,000 $ 488,000 Liabilities and Stockholders’ Equity Liabilities Current liabilities Accounts payable $ 80,000 $ 108,000 Other 34,000 30,000 Total current liabilities 114,000 138,000 Bonds payable 132,000 134,000 Total liabilities 246,000 272,000 Stockholders’ equity Common stock (100,000 shares) 230,000 230,000 Retained earnings 60,000 (14,000 ) Total stockholders’ equity 290,000 216,000 Total liabilities and stockholders’ equity $ 536,000 $ 488,000

Explanation / Answer

2019 2018 formula Calculations 2019 Calculations 2018 e Price earning ratio market Value per share / Earnngs per share $9.54/$0.72 13.25 Times $11.88/$0.54 22 Times f Book Value Sahre holders equity / Number off shares $290,000/100,000 2.9 $216,000/100,000 g Interest earned Income before income tax and Interest /Interest expense ($72000+$6000+$42000)/$6000 20 Times ($54000+$6000+$36000)/$6000 16 Times h working capital Current assets - current liabiltiies $286000-$114000 172000 $278000-$138000 140000 i current ratio Current Assets/ current Liabilities $286000/$114000 2.51 $278000/$138000 2.01 j quick ratio Current assets- Inventories / Current Liabilities ($286000-200,000)/$114000 0.75 ($278000-$192000)/$138000 0.62 k Accounts receivables turnover Annual Sales / accouts receivables $420,000/$70,000 6 Times $350,000/$64000 5.47 Times l Inventory turnover Cost of goods sold / inventory Balance 252,000/$200,000 1.26 Times $206000/$192,000 1.0729167 Times m Debt to equity ratio Total Debt /Equity *100 $246,000/290,000 *100 84.83% $272,000/$216000   *100 125.93% n Debt to assets ratio Total debt / Total Assets *100 $246000/536000 *100 45.90% $272000/488000 *100 55.74%

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.