| Rainbow Paint Co | | | | Rainbow Paint Co |
| Comparitive Income Statement | | | | Comparative Balance Sheet |
| For the Years Ended December, 2019 and 2018 | | | | December 31, 2019, 2018 and 217 |
| | 2009 | 2008 | | | 2019 | 2018 | 2017 |
| Sales | $ 5,125,000 | $ 3,257,600 | | Assets |
| Sales returns and allowances | $ 125,000 | $ 57,600 | | Current assets: |
| Net Sales | $ 5,000,000 | $ 3,200,000 | | Cash | $ 175,000 | $ 125,000 | $ 125,000 |
| Cost of goods sold | $ 3,400,000 | $ 2,080,000 | | Marketable securities | $ 150,000 | $ 50,000 | $ 50,000 |
| Gross profit | $ 1,600,000 | $ 1,120,000 | | Accounts receivable (net) | $ 425,000 | $ 325,000 | $ 320,000 |
| Selling expenses | $ 650,000 | $ 464,000 | | Inventories | $ 720,000 | $ 480,000 | $ 500,000 |
| Administrative expenses | $ 325,000 | $ 224,000 | | Prepaid expenses | $ 30,000 | $ 20,000 | $ 20,000 |
| Total operating expenses | $ 975,000 | $ 688,000 | | Total current assets | $ 1,500,000 | $ 1,000,000 | $ 1,015,000 |
| Income from Operations | $ 625,000 | $ 432,000 | | Long-term investments | $ 250,000 | $ 225,000 | $ 225,000 |
| Interest Income | $ 25,000 | $ 19,200 | | Property, Plant and Equipment (net) | $ 2,093,000 | $ 1,948,000 | $ 1,948,000 |
| Interest Expenses | $ 105,000 | $ 64,000 | | Total assets | $ 3,843,000 | $ 3,173,000 | $ 3,188,000 |
| Income before income tax | $ 545,000 | $ 387,200 |
| Income tax expense | $ 300,000 | $ 176,000 | | Liabilities |
| Net Income | $ 245,000 | $ 211,200 | | Current liabilities | $ 750,000 | $ 650,000 | $ 650,000 |
| | | | | Long-term liabilities: |
| | | | | Mortgage not payable, 10%, due 2012 | $ 410,000 | $ - 0 | $ - 0 |
| Rainbow Paint Co | | | | Bonds payable, 8%, due 2015 | $ 800,000 | $ 800,000 | $ 800,000 |
| Comparative Retained Earnings Statement | | | | Total long-term liabilities | $ 1,210,000 | $ 800,000 | $ 800,000 |
| For the Years Ended December, 2019 and 2018 | | | | Total liabilities | $ 1,960,000 | $ 1,450,000 | $ 1,450,000 |
| | 2009 | 2008 |
| Retained earnings, January 1 | $ 683,000 | $ 541,800 | | Sotckholders' Equity |
| Add net income for year | $ 245,000 | $ 211,200 |
| Total | $ 928,000 | $ 753,000 | | Common Stock, $10 par | $ 1,000,000 | $ 1,000,000 | $ 1,000,000 |
| Deduct dividends: | | | | Retained earnings | $ 883,000 | $ 723,000 | $ 738,000 |
| | | | | Total Stockholders' Equity | $ 1,883,000 | $ 1,723,000 | $ 1,738,000 |
| On common stock | $ 45,000 | $ 30,000 | | Total liabilities and stockholders' equity | $ 3,843,000 | $ 3,173,000 | $ 3,188,000 |
| Total | $ 45,000 | $ 30,000 |
| Retained earnings, December 31 | $ 883,000 | $ 723,000 | | # of shares CS outstanding | 100,000 |
| | | | | market value per share (given) | $25 |
| | | | | Credt Terms: n/30 days |
| | | | | Bank requires a times interest earned ratio of 10. |
| | | | | | 2019 | | 2018 |
| Working Capital | current assets - current liabilities | | | | $ 750,000 | | $ 350,000 |
| Current Ratio | current assets/current liabilites | | | | 2.00 | | 1.54 |
| Quick Ratio | (cash + marketable securities + receivables)/current liabilities | | | | 1.00 | | 0.77 |
| Days sales in receivable | Average AR/average daily sales | | average daily sales = net sales/365 | | 27.38 | days | 36.79 |
| inventory turnover | COGS/average inventory | | | | 5.67 | times | 4.24 |
| debt to equity | total liabilities/total stockhoders' equity | | | | 1.04 | | 0.84 |
| times-interest earned | EBIT/Interest Expense | | | | 6.19 | times | $ 7.05 |
| ROA | (net income + interest expense)/average total assets | | | | 10% | | 8.65% |
| EPS | net income /# of shares common stock outstanding | | | | $ 2.45 | | 2.11 |
| P/E ratio | market value per share/ EPS | | | | 10.20 | | 11.84 |
Sam1409
appendixAFSAclassexampleupdated12.xlsx
