Fianacial analysis

Selected comparative financial statements of Bennington Company follow:

BENNINGTON COMPANY

Comparative Income Statements

For Years Ended December 31, 2012, 2011, and 2010

2012

2011

2010

  Sales

$

457,083

$

350,163

$

243,000

  Cost of goods sold

275,164

219,202

155,520

  Gross profit

181,919

130,961

87,480

  Selling expenses

64,906

48,322

32,076

  Administrative expenses

41,137

30,814

20,169

  Total expenses

106,043

79,136

52,245

  Income before taxes

75,876

51,825

35,235

  Income taxes

14,113

10,624

7,153

  Net income

$

61,763

$

41,201

$

28,082

BENNINGTON COMPANY

Comparative Balance Sheets

December 31, 2012, 2011, and 2010

2012

2011

2010

  Assets

  Current assets

$

47,321

$

37,023

$

49,491

  Long-term investments

0

1,200

3,960

  Plant assets, net

85,231

90,490

53,188

  Total assets

$

132,552

$

128,713

$

106,639

  Liabilities and Equity

  Current liabilities

$

19,353

$

19,178

$

18,662

  Common stock

71,000

71,000

53,000

  Other paid-in capital

8,875

8,875

5,889

  Retained earnings

33,324

29,660

29,088

  Total liabilities and equity

$

132,552

$

128,713

$

106,639

Required:

1.

Compute each year's current ratio. (Round your answers to 1 decimal place.)

Current ratio

December 31, 2012:

[removed]

to

 [removed]  

Current ratio

December 31, 2011:

[removed]

to

 [removed]  

Current ratio

December 31, 2010:

[removed]

to

 [removed]  

2.

Express the income statement data in common-size percents. (Percents are rounded to two decimals and thus may not exactly sum to totals and subtotals. Round your answers to 2 decimal places. Omit the "%" sign in your response.)

BENNINGTON COMPANY
Common-Size Comparative Income Statements
For Years Ended December 31, 2012, 2011, and 2010

2012

2011

2010

  Sales

[removed] %

[removed] %

[removed] %  

  Cost of goods sold

[removed]    

[removed]    

[removed]      

  Gross profit

[removed]    

[removed]    

[removed]      

  Selling expenses

[removed]    

[removed]    

[removed]      

  Administrative expenses

[removed]    

[removed]    

[removed]      

  Total expenses

[removed]    

[removed]    

[removed]      

  Income before taxes

[removed]    

[removed]    

[removed]      

  Income taxes

[removed]    

[removed]    

[removed]      

  Net income

[removed] %

[removed] %

[removed] %  

3.

Express the balance sheet data in trend percents with 2010 as the base year. (Round your answers to 2 decimal places. Leave no cells blank - be certain to enter "0" wherever required. Omit the "%" sign in your response.)

BENNINGTON COMPANY
Balance Sheet Data in Trend Percents
December 31, 2012, 2011, and 2010

2012

2011

2010

  Assets

  Current assets

[removed] %  

[removed] %  

[removed] %  

  Long-term investments

[removed]      

[removed]      

[removed]      

  Plant assets

[removed]      

[removed]      

[removed]      

  Total assets

[removed]      

[removed]      

[removed]      

  Liabilities and Equity

  Current liabilities

[removed] %  

[removed] %  

[removed] %  

  Common stock

[removed]      

[removed]      

[removed]      

  Other contributed capital

[removed]      

[removed]      

[removed]      

  Retained earnings

[removed]      

[removed]      

[removed]      

  Total liabilities and equity

[removed]      

[removed]      

[removed]      

Selected year-end financial statements of McCord Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2010, were inventory, $53,900; total assets, $229,400; common stock, $95,000; and retained earnings, $52,348.)

McCORD CORPORATION
Income Statement
For Year Ended December 31, 2011

  Sales

$

450,600  

  Cost of goods sold

297,450  

  Gross profit

153,150  

  Operating expenses

99,500  

  Interest expense

3,900  

  Income before taxes

49,750  

  Income taxes

20,041  

  Net income

$

29,709  

McCORD CORPORATION
Balance Sheet
December 31, 2011

  Assets

  Liabilities and Equity

  Cash

$

16,000  

  Accounts payable

$

16,500  

  Short-term investments

8,800  

  Accrued wages payable

4,800  

  Accounts receivable, net

31,400  

  Income taxes payable

3,300  

  Notes receivable (trade)*

4,000  

  Long-term note payable, secured

  Merchandise inventory

32,150  

     by mortgage on plant assets

65,400  

  Prepaid expenses

3,050  

  Common stock

95,000  

  Plant assets, net

153,300  

  Retained earnings

63,700  

  Total assets

$

248,700  

  Total liabilities and equity

$

248,700  

* These are short-term notes receivable arising from customer (trade) sales.

Required:

Compute the following. (Use 365 days a year. Do not round intermediate calculations and round your final answers to 1 decimal place. Omit the "%" sign in your response):

(1)

  Current ratio

[removed]

 to

[removed]

(2)

  Acid-test ratio

[removed]

 to

[removed]

(3)

  Days' sales uncollected (including note)

[removed]

 days

(4)

  Inventory turnover

[removed]

 times

(5)

  Days' sales in inventory

[removed]

 days

(6)

  Debt-to-equity ratio

[removed]

 to

[removed]

(7)

  Times interest earned

[removed]

 times

(8)

  Profit margin ratio

[removed]

 %

(9)

  Total asset turnover

[removed]

times

(10)

  Return on total assets

[removed]

 %

(11)

  Return on common stockholders' equity

[removed]

 %