LO 4
(Learning Objective 4: Construct an income statement, statement of
- 1. Income statement.
- 2. Statement of retained earnings, and
- 3. Balance sheet.
Want to see the full answer?
Check out a sample textbook solutionChapter 1 Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
- Ratio Analysis Rising Stars Academy provided the following information on its 2019 balance sheet and state mcnt of cash flows: Long-term debt S 4,400 Interest expense S 398 Total liabilities 8,972 Net income 559 Total assets 38,775 Interest payments 432 Total equity 29,803 Cash flows from operations 1.015 Operating income 1.223 Income tax expenses 266 Income taxes paid 150 Required: Calculate the following ratios for Rising Stars: (a) debt to equity, (b) debt to total assets, (c) long-term debt to equity, (d) times interest earned (accrual basis), and (e) times interest earned (cash basis). (Note: Round answers to three decimal places.) CONCEPTUAL CONNECTION Interpret these results. 3.What does it mean if a bond is callablearrow_forwardE12-24B Vertical analysis (Learning Objective 2) 15-20 min. Simpson Painting, Inc., requested that you perform a vertical analysis of its balance sheet to determine the component percentages of its assets, liabilities, and stockholders' equity. Round to the nearest tenth of a percent. P. Donnelly, Inc. Comparative Income Statement Years Ended December 31, 2018 and 2017 Revenue Expenses: Cost of Goods Sold Selling and General Expenses Interest Expense Income Tax Expense Total Expenses Net Income 2018 $500,000 $245,000 111,000 10,000 54,700 420,700 $ 79,300 2017 $439,500 $236,000 103,500 6,500 44,400 390,400 $ 49,100arrow_forwardMotorola Credit Corporation's annual report: Net revenue (sales) Net earnings Total assets Total liabilities Total stockholders' equity a. Find the total debt to total assets ratio. Note: Round your answer to the nearest hundredth percent. Total debt to total assets Return on equity b. Find the return on equity ratio. Note: Round your answer to the nearest hundredth percent. (dollars in millions) $ 297 163 2,175 1,880 295 Asset turnover c. Find the asset turnover ratio. Note: Round your answer to the nearest cent. Profit margin % % % d. Find the profit margin ratio on net sales. Note: Round your answer to the nearest hundredth percent.arrow_forward
- Randall Corporation reported the following revenue data:Year Net revenues (in millions)$$$$6,8007,0046,7327,2762016201720182019Use 2016 as the base year. The trend percentage in 2019 is closest toa. 93%.b. 104%.c. 107%.d. 112%arrow_forwardCoronado Incorporated had average total assets in 2025 of $6345000. It reported sales for of $8217000 that year. Average liabilities for the year were $5199000. Net income for the year was $958095. What is Coronado' return on assets for 2025? O 15.10 % O 18.43% O 6.52% O 11.66%arrow_forwardASAP!! Consider the given income statement and balance sheet and calculate the following ratios : Return on Assets Return on Equity Debt Ratio Current Ratio Write your comment about each of the ratios calculated what it describes. Following are the Financial Statements of CSU CORPORATION for the year ended Dec. 31, 2020 Assets : 2019 Cash $1400 Accounts Receivable 4000 Supplies 1800 Equipment 16000 Total Assets $23,200 Liabilities and Shareholders’ Equity : Liabilities : Notes Payable $5000 Accounts Payable…arrow_forward
- Some selected financial statement items belonging to Tower Company are given in the table below. According to this information, which of the following is Return on Assets (ROA) in 2021? Inventory 12,500 Total Assets in 2021 100,000 Current Liabilities 30,000 Total Assets in 2020 80,000 Net Profit 18,000 Shareholders' Equity 65,000 Select one: a. 24% b. 20% c. 11% d. 15%arrow_forwardHerbert Wong has extracted the following information from her income statement and balance sheet for 2021 and 2020: 2021 2020 Profit After Tax $656,810 $672,346 Cost of Sales $54,269 $53,251 Sales Revenue $259,368 $212,962 Inventory $35,505 $45,285 Accounts payable $120,483 $129,398 Accounts receivable (Debtors) $59,498 $79,380 Owner's Equity $1,523,999 $1,131,784 Based on the information provided, calculate the Days in Accounts Receivable for 2021, expressed in days to 2 decimal places.arrow_forwardnterpret the results of the debt to equity ratio and how the company has managed debt over the last two years. Balance Sheet 2018 2019 Cash $63,000 $201,000 Accounts Receivable 199,000 305,000 Marketable Securities 81,000 42,000 Inventories 441,000 455,000 Prepaids 5,000 9,000 Total Current Assets 789,000 1,012,000 Property, Plant, and Equipment, net 858,000 858,000 Total Assets $1,647,000 $1,870,000 Account Payable $150,000 $100,000 Accruals 101,000 95,000 Total Current Liabilities $251,000 $195,000 Bonds Payable 405,000 575,000 Total Liabilities 656,000 770,000 Common Stocks 700,000 700,000 Retained Earnings 291,000 400,000 Total Stockholders’ Equity 991,000 1,100,000 Total Liabilities & Equity $1,647,000 $1,870,000 Income Statement…arrow_forward
- S15-7 Computing rate of return on total assets Godhi's 2014 financial statements reported the following items-with 2013 figures given for comparison: Learning GODHI, INC. Balance Sheet As of December 31, 2014 and 2013 2014 2013 $ 33,538 $ 29,562 Total Assets 17,100 14,962 Total Liabilities Total Stockholders' Equity (all common) 16,438 14,600 $ 33,538 $ 29,562 Total Liabilities and Stockholders' Equity Net income for 2014 was $3,890 and interest expense was $210. Compute Godhi's rate of return on total assets for 2014. (Round to the nearest percent.)arrow_forwardSome selected financial statement items belonging to MNO Company are given in the table below. According to this information, which of the following is Return on Assets (ROA) in 2021? Inventory 12,500Total Assets in 2021 110,000Current Liabilities 40,000Total Assets in 2020 90,000Net Profit 12,000Shareholders' Equity 65,000 Select one:a. 0.12b. 0.10c. 0.18d. 0.13arrow_forwardYou have compiled the following information on Winslow, Inc.: 2019 2020 Assets Cash $ 298 $ 306 Accounts receivable 3,006 3,422 Inventory 5,210 5,650 Net fixed assets 32,780 36,400 Total assets $ 41,294 $ 45,778 Liabilities and Equity Accounts payable $ 6,219 $ 6,184 Other current liabilities 1,880 1,625 Long-term debt 17,951 21,991 Stockholders’ equity 15,244 15,978 Total liabilities and equity $ 41,294 $ 45,778 Sales $ 11,418 Cost of goods sold 6,320 General and administrative 2,419 Depreciation 967 EBIT $ 1,712 Interest 230 EBT $ 1,482 Taxes 519 Net income $ 963 What is the cash flow to creditors for 2020?arrow_forward
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning