Balance Sheet and Income Statement ASSETS 2015 2014 CASH AND MARKETABLE SECURITI
ID: 3196494 • Letter: B
Question
Balance Sheet and Income Statement
ASSETS
2015
2014
CASH AND MARKETABLE SECURITIES
29,000
25,000
ACCOUNTS RECEIVABLE
116,000
100,000
INVENTORIES
145,000
125,000
CURRENT ASSETS
290,000
250,000
GROSS PLANT AND EQUIPMENT
362,000
350,000
LESS: ACCUMULATED DEPRECIATION
130,000
100,000
NET FIXED ASSETS
232,000
250,000
TOTAL ASSETS
522,000
500,000
LIABILITIES AND EQUITY
ACCOUNTS PAYABLE
90,480
78,000
ACCRURALS
34,800
30,000
NOTES PAYABLE
25,420
34,000
CURRENT LAIBILITIES
150,700
142,000
LONG TERM DEBT
145,000
140,000
TOTAL LIABILITIES
295,700
282,000
COMMON STOCK ($1.00 par)
150,000
150,000
RETAINED EARNINGS
76,300
68,000
TOTAL OWNER’S EQUITY
226,300
218,000
TOTAL LIABILITIES AND EQUITY
522,000
500,000
INCOME STATEMENT
2015
2014
NET REVENUES & SALES (100,000 UNITS)
812,000
700,000
COST OF GOODS SOLD
522,000
450,000
GROSS PROFIT
290,000
250,000
FIXED OPERATING EXPENSES (pre depreciation)
174,200
151,000
EBITDA Earnings Before Interest, Taxes, Depreciation & Amortization
115,800
99,000
DEPRECIATION EXPENSE
30,000
25,000
OPERATING INCOME (EBIT)
85,800
74,000
INTEREST
14,500
14,000
INCOME BEFORE TAXES (EBT)
71,300
60,000
INCOME TAXES (40%)
28,520
24,000
NET INCOME
42,780
36,000
Dividends
34,480
28,500
Retained Earnings
8,300
7,500
NUMBER OF SHARES OUTSTANDING
50,000
50,000
Dividends per share
0.6896
0.57
Use the Income statement and balance sheet provided to Calculate the cash from Investment activities.
32,000
What does the firms Quick ratio in 2015 show us about the company?
If the company collects 96% of its receivables it will be able to cover its current Liabilities
If the company collects all of its receivables it still will not be able to cover its current liabilities.
The company's quick ratio is larger than its current ratio
Are the Equity investors (stock holders) getting a better return in 2015 than 2014?
Balance Sheet and Income Statement
ASSETS
2015
2014
CASH AND MARKETABLE SECURITIES
29,000
25,000
ACCOUNTS RECEIVABLE
116,000
100,000
INVENTORIES
145,000
125,000
CURRENT ASSETS
290,000
250,000
GROSS PLANT AND EQUIPMENT
362,000
350,000
LESS: ACCUMULATED DEPRECIATION
130,000
100,000
NET FIXED ASSETS
232,000
250,000
TOTAL ASSETS
522,000
500,000
LIABILITIES AND EQUITY
ACCOUNTS PAYABLE
90,480
78,000
ACCRURALS
34,800
30,000
NOTES PAYABLE
25,420
34,000
CURRENT LAIBILITIES
150,700
142,000
LONG TERM DEBT
145,000
140,000
TOTAL LIABILITIES
295,700
282,000
COMMON STOCK ($1.00 par)
150,000
150,000
RETAINED EARNINGS
76,300
68,000
TOTAL OWNER’S EQUITY
226,300
218,000
TOTAL LIABILITIES AND EQUITY
522,000
500,000
INCOME STATEMENT
2015
2014
NET REVENUES & SALES (100,000 UNITS)
812,000
700,000
COST OF GOODS SOLD
522,000
450,000
GROSS PROFIT
290,000
250,000
FIXED OPERATING EXPENSES (pre depreciation)
174,200
151,000
EBITDA Earnings Before Interest, Taxes, Depreciation & Amortization
115,800
99,000
DEPRECIATION EXPENSE
30,000
25,000
OPERATING INCOME (EBIT)
85,800
74,000
INTEREST
14,500
14,000
INCOME BEFORE TAXES (EBT)
71,300
60,000
INCOME TAXES (40%)
28,520
24,000
NET INCOME
42,780
36,000
Dividends
34,480
28,500
Retained Earnings
8,300
7,500
NUMBER OF SHARES OUTSTANDING
50,000
50,000
Dividends per share
0.6896
0.57
BALANCE SHEET 2015 2014 INCOME STATEMENT 2015 2014 ASSETS 29,000 116,000 145,000 290,000 362,000 130,000 232,000 522,000 25,000 100,000 125,000 250,000 300,000 100,000 200,000 500,000 CASH AND MARKETABLE SECURITIES CCOUNTS RECEIVABLE NET REVENUES & SALES (100,000 812,000 700,000 UNITS ENTORIES CURRENT ASSETS COST OF GOODS SOLD 522,000 T 290,000 FIXED OPERATING EXPENSES (pre 174,200 450,000 250,000 151,000 ROSS PLANT AND EOUIPMENT ESS: ACCUMULATED DEPRECIATION GROSS PROFI NET FIXED ASSETS TOTAL ASSETS depreciation) DEPRECIATION EXPENSE 30,000 85,800 14,500 71,300 28,520 42,780 25,000 74,000 14,000 60,000 24,000 36,000 OPERATING INCOME (EBIT) LIABILITIES AND EQUITY INTEREST INCOME BEFORE TAXES (EBT) INCOME TAXES (40%) NET INCOME 78,000 30,000 34,000 142,000 140,000 282,000 50,000 68,000 218,000 ACCOUNTS PAYABLE 90.480 34,800 25,420 150,700 145,000 295,700 150,000 76,300 226,300 CCRURALS OTES PAYABLE CURRENT LAIBILITIES LONG TERM DEBT TOTAL LIABILITIES NUMBER OF SHARES OUTSTANDING 50,000 50,000 COMMON STOCK ($1.00 par TAINED EARNINGS TOTAL OWNER'S EQUITY TOTAL LIABILITIES AND EQUITY 522,000 500,000Explanation / Answer
Fixed assets have increased from 2,00,000 to 2,32,000. This shows purchase of asset. Hence cash of 32,000 goes out.
Ans = -32,000
Quick ratio is the ratio of current assets and current liability.
Quick assets exclude inventories.
2015 quick assets = 29,000+116000 = 145000
current liab = 150700
ratio = 0.9621
Here receivables are less than current liabilities. Thus we can say that even if all receivables are received, company can not pay its current liabilities.
Yes the share holders are getting better return as the profit after tax has increased and the outstanding shares remains the same.
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