Appendix B
Organizational Char
Minitrex
VP Marketing
(Jon Bettman)
Director Sales
(Georges Degas)
VP Insurance
(Harold Blumfen)
VP Financing
(Mariella Hopkins)
CFO
Director IT
(Denny Khan)
Exercise 13-13
The condensed financial statements of Elliott Company for the years 2013 and 2014 are presented below.
ELLIOTT COMPANY
Balance Sheets
December 31 (in thousands)
2014
2013
Current assets
Cash and cash equivalents
$330
$360
Accounts receivable (net)
506
436
Inventory
519
449
Prepaid expenses
130
160
Total current assets
1,485
1,405
Property, plant, and equipment (net)
410
380
Investments
46
46
Intangibles and other assets
530
510
Total assets
$2,471
$2,341
Current liabilities
$856
$826
Long-term liabilities
539
439
Stockholders’ equity—common
1,076
1,076
Total liabilities and stockholders’ equity
$2,471
$2,341
ELLIOTT COMPANY
Income Statements
For the Year Ended December 31 (in thousands)
2014
2013
Sales revenue
$3,859
$3,519
Costs and expenses
Cost of goods sold
1,006
926
Selling & administrative expenses
2,400
2,330
Interest expense
10
20
Total costs and expenses
3,416
3,276
Income before income taxes
443
243
Income tax expense
177
97
Net income
$ 266
$ 146
Compute the following ratios for 2014 and 2013. (Round all answers to 2 decimal places, e.g. 1.83 or 12.61%.)
(a)
Current ratio.
(b)
Inventory turnover. (Inventory on December 31, 2012, was $430.)
(c)
Profit margin.
(d)
Return on assets. (Assets on December 31, 2012, were $2,790.)
(e)
Return on common stockholders’ equity. (Equity on December 31, 2012, was $970.)
(f)
Debt to assets ratio.
(g)
Times interest earned.
2014
2013
Current ratio.
:1
:1
Inventory turnover.
Profit margin.
%
%
Return on assets.
%
%
Return on common stockholders’ equity.
%
%
Debt to assets ratio.
%
%
Times interest earned.
times
times
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Exercise 13-9
Kinder Company has these comparative balance sheet data:
KINDER COMPANY
Balance Sheets
December 31
2014
2013
Cash
$ 36,210
$ 72,420
Accounts receivable (net)
168,980
144,840
Inventory
144,840
120,700
Plant assets (net)
482,800
434,520
$832,830
$772,480
Accounts payable
$ 120,700
$ 144,840
Mortgage payable (15%)
241,400
241,400
Common stock, $10 par
337,960
289,680
Retained earnings
132,770
96,560
$832,830
$772,480
Additional information for 2014:
1.
Net income was $32,000.
2.
Sales on account were $386,100. Sales returns and allowances amounted to $28,100.
3.
Cost of goods sold was $228,200.
4.
Net cash provided by operating activities was $57,600.
5.
Capital expenditures were $28,600, and cash dividends were $20,900.
Compute the following ratios at December 31, 2014. (Round all answers to 2 decimal places, e.g. 1.83.)
(a)
Current ratio.
:1
(b)
Accounts receivable turnover.
times
(c)
Avera.
1. Appendix B
Organizational Char
Minitrex
VP Marketing
(Jon Bettman)
Director Sales
(Georges Degas)
VP Insurance
(Harold Blumfen)
VP Financing
(Mariella Hopkins)
CFO
Director IT
(Denny Khan)
Exercise 13-13
The condensed financial statements of Elliott Company for the
years 2013 and 2014 are presented below.
2. ELLIOTT COMPANY
Balance Sheets
December 31 (in thousands)
2014
2013
Current assets
Cash and cash equivalents
$330
$360
Accounts receivable (net)
506
436
Inventory
519
449
Prepaid expenses
130
160
Total current assets
1,485
3. 1,405
Property, plant, and equipment (net)
410
380
Investments
46
46
Intangibles and other assets
530
510
Total assets
$2,471
$2,341
Current liabilities
$856
$826
Long-term liabilities
539
439
Stockholders’ equity—common
1,076
4. 1,076
Total liabilities and stockholders’ equity
$2,471
$2,341
ELLIOTT COMPANY
Income Statements
For the Year Ended December 31 (in thousands)
2014
2013
Sales revenue
$3,859
$3,519
Costs and expenses
Cost of goods sold
1,006
926
Selling & administrative expenses
2,400
2,330
Interest expense
5. 10
20
Total costs and expenses
3,416
3,276
Income before income taxes
443
243
Income tax expense
177
97
Net income
$ 266
$ 146
Compute the following ratios for 2014 and 2013. (Round all
answers to 2 decimal places, e.g. 1.83 or 12.61%.)
(a)
Current ratio.
(b)
Inventory turnover. (Inventory on December 31, 2012, was
$430.)
(c)
6. Profit margin.
(d)
Return on assets. (Assets on December 31, 2012, were $2,790.)
(e)
Return on common stockholders’ equity. (Equity on December
31, 2012, was $970.)
(f)
Debt to assets ratio.
(g)
Times interest earned.
2014
2013
Current ratio.
:1
:1
Inventory turnover.
Profit margin.
7. %
%
Return on assets.
%
%
Return on common stockholders’ equity.
%
%
Debt to assets ratio.
%
%
Times interest earned.
times
times
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8. Exercise 13-9
Kinder Company has these comparative balance sheet data:
KINDER COMPANY
Balance Sheets
December 31
2014
2013
Cash
$ 36,210
$ 72,420
Accounts receivable (net)
168,980
144,840
Inventory
144,840
120,700
Plant assets (net)
482,800
9. 434,520
$832,830
$772,480
Accounts payable
$ 120,700
$ 144,840
Mortgage payable (15%)
241,400
241,400
Common stock, $10 par
337,960
289,680
Retained earnings
132,770
96,560
$832,830
$772,480
Additional information for 2014:
1.
Net income was $32,000.
10. 2.
Sales on account were $386,100. Sales returns and allowances
amounted to $28,100.
3.
Cost of goods sold was $228,200.
4.
Net cash provided by operating activities was $57,600.
5.
Capital expenditures were $28,600, and cash dividends were
$20,900.
Compute the following ratios at December 31, 2014. (Round all
answers to 2 decimal places, e.g. 1.83.)
(a)
Current ratio.
:1
(b)
Accounts receivable turnover.
times
(c)
Average collection period.
days
(d)
11. Inventory turnover.
times
(e)
Days in inventory.
days
(f)
Cash debt coverage ratio.
times
(g)
Current cash debt coverage ratio.
times
(h)
Free cash flow.
$
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