Accounting 2
ashanti09
ACCT.2PT.5.docxThe comparative statements of Wahlberg Company are presented here:
|
Wahlberg Company Income Statements For the Years Ended December 31 |
||||
|
|
|
2020 |
|
2019 |
|
Net sales |
|
$1,890,540 |
|
$1,750,500 |
|
Cost of goods sold |
|
1,058,540 |
|
1,006,000 |
|
Gross profit |
|
832,000 |
|
744,500 |
|
Selling and administrative expenses |
|
500,000 |
|
479,000 |
|
Income from operations |
|
332,000 |
|
265,500 |
|
Other expenses and losses |
|
|
|
|
|
Interest expense |
|
22,000 |
|
20,000 |
|
Income before income taxes |
|
310,000 |
|
245,500 |
|
Income tax expense |
|
92,000 |
|
73,000 |
|
Net income |
|
$218,000 |
|
$172,500 |
|
Wahlberg Company Balance Sheets December 31 |
||||
|
Assets |
|
2020 |
|
2019 |
|
Current assets |
|
|
|
|
|
Cash |
|
$60,100 |
|
$64,200 |
|
Debt investments (short-term) |
|
74,000 |
|
50,000 |
|
Accounts receivable |
|
117,800 |
|
102,800 |
|
Inventory |
|
126,000 |
|
115,500 |
|
Total current assets |
|
377,900 |
|
332,500 |
|
Plant assets (net) |
|
649,000 |
|
520,300 |
|
Total assets |
|
$1,026,900 |
|
$852,800 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Accounts payable |
|
$160,000 |
|
$145,400 |
|
Income taxes payable |
|
43,500 |
|
42,000 |
|
Total current liabilities |
|
203,500 |
|
187,400 |
|
Bonds payable |
|
220,000 |
|
200,000 |
|
Total liabilities |
|
423,500 |
|
387,400 |
|
Stockholders’ equity |
|
|
|
|
|
Common stock ($5 par) |
|
290,000 |
|
300,000 |
|
Retained earnings |
|
313,400 |
|
165,400 |
|
Total stockholders’ equity |
|
603,400 |
|
465,400 |
|
Total liabilities and stockholders’ equity |
|
$1,026,900 |
|
$852,800 |
All sales were on account. Net cash provided by operating activities for 2020 was $220,000. Capital expenditures were $136,000, and cash dividends were $70,000.
Compute the following ratios for 2020. (Round free cash flow to 0 decimal places, e.g. 5,275 and all other answers to 2 decimal places, e.g. 1.83 or 1.83%. Use 365 days for calculation.)
|
(a) |
|
Earnings per share |
|
$
|
|
|
(b) |
|
Return on common stockholders’ equity |
|
|
% |
|
(c) |
|
Return on assets |
|
|
% |
|
(d) |
|
Current ratio |
|
|
:1 |
|
(e) |
|
Accounts receivable turnover |
|
|
times |
|
(f) |
|
Average collection period |
|
|
days |
|
(g) |
|
Inventory turnover |
|
|
times |
|
(h) |
|
Days in inventory |
|
|
days |
|
(i) |
|
Times interest earned |
|
|
times |
|
(j) |
|
Asset turnover |
|
|
times |
|
(k) |
|
Debt to assets ratio |
|
|
% |
|
(l) |
|
Free cash flow |
|
$
|
|
