Question 1

Selected balances from a company's financial statements are shown below:
 $\begin{array}{|l|r|r|r|}
\hline& \begin{array}{c}
\text { Dec. } 31, \
2013
\end{array} & \begin{array}{c}
\text { Dec. } 31, \
2014
\end{array} & \begin{array}{c}
\text { For the } \
\text { Year } 2014
\end{array} \
\hline \text { Merchandise inventory } & \$ 15,000 & \$ 20,000 \
\hline \text { Accounts payable } & 32,000 & 26,000 \
\hline \text { Salaries payable } & 4,400 & 3,000 \
\hline \text { Accounts receivable } & 24,000 & 21,000 \
\hline \text { Total assets } & 234,000 & 286,000\
\hline \text { Sales (all on credit) } & & & \$ 312,000 \
\hline \text { Cost of goods sold } & & & 165,600 \
\hline \text { Salaries expense } & & & 48,000 \
\hline \text { Other expenses } & & & 75,000 \
\hline \text { Net income } & & & 24,000\
\hline
\end{array}$ Use the information above to calculate the following current year ratios:
(a)2014 inventory turnover.
(b)Days' sales uncollected at Dec.31, 2014.
(c)2014 profit margin.
(d)2011 return on total assets.

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Question 2

A company's calendar-year financial data are shown below.The company has pledged all of its net plant assets as security for its long-term notes payable:
 \(\begin{array}{|l|r|}
\hline \text { Sales } & \$ 650,000 \
\hline \text { Cost of goods sold } & \underline {422,500} \
\hline \text { Gross profit } & \$ 227,500 \
\hline \text { Operating expenses } & \underline{140,500} \
\hline \text { Operating income } & \$ 87,000 \
\hline \text { Interest expense } & 9,100 \
\hline \text { Income before taxes } & \$ 77,900 \
\hline \text { Income taxes } & 23,400 \
\hline \text { Net income } & \underline {\$ 54,500} \
\hline\
\hline&\begin{array}{lll}
 \underline {\text { Ending }} \
 \underline {\text { Balances } } \
\end{array}
 \
\hline \text { Cash } & \$ 19,500 \
\hline \text { Accounts receivable (net) } & 65,000 \
\hline \text { Inventory } & 71,500 \
\hline \text { Plant assets (net) } & 195,000 \
\hline \text { Total assets } & \underline {\$ 351,000} \
\hline\
\hline \text { Current liabilities } & \$ 74,100 \
\hline \text { Long-term notes payable } & 97,500 \
\hline \text { Common stock } & 65,000 \
\hline \text { Retained earnings } & \underline{114,400} \
\hline \text { Total liabilities and equity } & \underline {\$ 351,000}\
\hline
\end{array}\) Calculate the following ratios for this company:
(a)Equity ratio.
(b)Pledged assets to secured liabilities ratio.
(c)Times interest earned.

Accepted Answer

The answer of A company's calendar-year financial data are shown...

Question 3

Comparative calendar year financial data for a company are shown below:
 $\begin{array}{|l|r|r|}
\hline & \underline {  2014   }& \underline {  2013   }\
\hline \text { Sales } & \$ 720,000 & \$ 607,500 \
\hline \text { Gross profit } & 270,000 & 224,800 \
\hline \text { Income before taxes } & 79,200 & 78,700 \
\hline \text { Net income } & 51,200 & 51,700 \
\hline \
\hline& \text { December 31, } & \text { December 31, } \
\hline &2014 & 2013 \
\hline \text { Liabilities } & \$ 493,500 & \$ 452,500 \
\hline \text { Common stock (\$12 par) } & 180,000 & 180,000 \
\hline \text { Contributed capital in excess of par } & 135,000 & 135,000 \
\hline \text { Retained earnings } & 204,000 & \underline{177,300} \
\hline \text { Total liabilities and equity } & \underline{ \$ 1,012,500} &  \underline{\$ 944,800} \
\hline
\end{array}$ Calculate:
(1)Return on total assets for 2014.
(2)Return on common stockholders' equity for 2014.

Accepted Answer

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Question 4

Explain where the following item should appear in the financial statements of a corporation:
One of the company's plants was destroyed by an earthquake.The area has never reported an earthquake.The amount of the loss, net of tax, was $850,000.

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Question 5

Given the following information about a corporation's current year activities, answer the questions below:
 $\begin{array}{|l|r|r|}
\hline& \underline {    \text {Debit  }  }& \underline {   \text {Credit }   }\
\hline\text { Sales }&&\$ 250,000\
\hline \text { Cost of goods sold } & \$ 90,000 \
\hline \text { Other operating expenses } & 54,000 \
\hline \begin{array}{l}
\text { Income from operation of discontinued Division W (net } \
\text { of } \$ 9,200 \text { tax })
\end{array} &&30,800 \
\hline \begin{array}{l}
\text { Extraordinary loss from hurricane damage (net of } \
\$ 11,000 \text { tax benefit) }
\end{array} & 37,000 \
\hline \begin{array}{l}
\text { Loss from disposal of Division W (net of } \$ 15,000 \text { tax } \
\text { benefit) }
\end{array} & 45,000 \
\hline \text { Unusual loss on sale of equipment } & 12,000 \
\hline \begin{array}{l}
\text { Effect on prior years' income of changing depreciation } \
\text { methods (net of } \$ 4,000 \text { tax) }
\end{array} & 13,500 \
\hline
\end{array}$ Compute the amounts that should be reported on the income statement as:
(1)Income from continuing operations.
(2)Income before extraordinary items and cumulative effect of changes in accounting principles.
(3)Net income.

Accepted Answer

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Question 6

The following are summaries from the income statements and balance sheets of Red Shoe, Inc.and Blue Shoe, Inc.
 \(\begin{array}{c}
 \text { RED SHOE, INC. } \
 \text { Consolidated Balance Sheets } \
 \text { (in millions) } \
\begin{array}{|l|r|r|}
\hline& \text { May } 31\
 \hline \quad\quad\quad\quad\quad\text { \quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad } & \quad\quad2014 & \quad2013 \
\hline
\end{array}\

\begin{array}{|l|r|r|}
\hline \text { Current assets: }\
\hline \text { Cash and cash equivalents } & \$ 634.0 & \$ 575.5 \
\hline \text { Accounts receivable, net of allowance } & 2,101.1 & 1,804.1 \
\hline \text { Inventories } & 1,514.9 & 1,373.8 \
\hline \text { Other current assets } & 429.9 & 401.3 \
\hline \text { Total current assets } & 4,679.9 & 4,154.7 \
\hline \text { Property, plant, and equipment, net } & 1,620.8 & 1614.5 \
\hline \text { Other long-term assets } & \underline{413.2} & \underline{670.8} \
\hline \text { Total assets } & \$ 6.713 .9 & \$ 6.440 .0 \
\hline
\end{array}\
\text { liabilities and Stockholders' Equity }\

\begin{array}{|l|r|r|}
\hline \text { Current liabilities: }\
\hline \text { Current portion of long-term debt } & \$ 205.7 & \$ 55.3 \
\hline \text { Notes payable } & 75.4 & 425.2 \
\hline \text { Accounts payable } & 572.7 & 504.4 \
\hline \text { Accrued liabilities } & 1,054.2 & 765.3 \
\hline \text { Income taxes payable } & \underline{107.2} & \underline{83.0} \
\hline \text { Total current liabilities } & 2,015.2 & 1,833.2 \
\hline \text { Long-term liabilities } & 708.0 & 767.8 \
\hline \text { Total liabilities } & 2,723.2 & 2,601.0\
\hline \text { Stockholders' equity: }\
\hline \text { Common stock } & 2.8 & 2.8 \
\hline \text { Contributed capital in excess of par value } & 589.0 & 538.7 \
\hline \text { Unearned stock compensation } & (0.6) & (5.1) \
\hline \text { Accumulated other comprehensive loss } & (239.7) & (192.4) \
\hline \text { Retained earnings } & 3,639.2 & 3,495.0 \
\hline \text { Total stockholders' equity } & 3,990.7 & 3,839.0 \
\hline \text { Total liabilities and stockholders' equity } & \$ 6.713 .9 & \$ 6.440 .0 \
\hline
\end{array}
\end{array}\) $\begin{array}{c}
\text { RED SHOE, INC. } \
\text { Consolidated Statement of Income } \
\text { May 31, 2014 } \
\text { (in millions) } \
\begin{array}{|l|r|}
\hline \text { Revenues } & \$ 10,697.0 \
\hline \text { Cost of sales } & 6,313.6 \
\hline \text { Gross profit } & 4,383.4 \
\hline \text { Operating expenses } & 3,137.6 \
\hline \text { Operating income } & 1,245.8 \
\hline \text { Interest expense } & 42.9 \
\hline \text { Other revenues and expenses } & \underline{79.9} \
\hline \text { Income before tax } & 1,123.0 \
\hline \text { Income taxes } & 382.9 \
\hline \text { Income before effect of accounting change } & 740.1 \
\hline \begin{array}{l}
\text { Cumulative effect of accounting change, net } \
\text { of tax }
\end{array} & \underline{266.1} \
\hline \text { Net income } & \$ 474.0\
\hline
\end{array}
\end{array}$
 \(\begin{array}{c}
 \text { BLUE SHOE, INC. } \
 \text { Consolidated Balance Sheets } \
 \text { (in millions) } \
\begin{array}{|l|r|r|}
\hline& \text { May } 31\
 \hline \quad\quad\quad\quad\quad\text { \quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad } & \quad\quad2014 & \quad2013 \
\hline
\end{array}\

\begin{array}{|l|r|r|}
\hline \text { Current assets: }\
\hline \text { Cash and cash equivalents } & \$ 34.5 & \$ 22.2 \
\hline \text { Accounts receivable, net of allowance } & 15.5 & 14.7 \
\hline \text { Inventories } & 27.2 & 28.4 \
\hline \text { Other current assets } & \underline{3.5} & \underline{4.2} \
\hline \text { Total current assets } & 80.7 & 69.5 \
\hline \text { Property, plant, and equipment, net } & 5.7 & 7.0 \
\hline \text { Other long-term assets } & 1.1 & 1.5 \
\hline \text { Total assets } & \$ 87.5 & \$ 78.0 \
\hline
\end{array}\
\text { liabilities and Stockholders' Equity }\

\begin{array}{|l|r|r|}
\hline \text { Current liabilities: }\
\hline \text { Accounts payable } & \$ 8.5 & \$ 6.6 \
\hline \text { Accrued liabilities } & 7.8 & 5.6 \
\hline \text { Total current liabilities } & 16.3 & 12.2 \
\hline \text { Long-term liabilities } & 2.5 & 2.6 \
\hline \text { Total liabilities } & \underline{18.8} & \underline{14.8} \
\hline \text { Stockholders' equity: } & & \
\hline \text { Common stock } & 2.3 & 2.3 \
\hline \text { Contributed capital in excess of par value } & 17.8 & 17.4 \
\hline \text { Unearned stock compensation } & (0.1) & (0.5) \
\hline \text { Accumulated other comprehensive loss } & (0.9) & (1.3) \
\hline \text { Treasury stock } & (6.3) & (5.4) \
\hline \text { Retained earnings } & \underline{55.9} & \underline{50.7} \
\hline \text { Total stockholders' equity } & \underline{68.7} & \underline{63.2} \
\hline \text { Total liabilities and stockholders' equity } & \$ 87.5 & \$ 78.0 \
\hline
\end{array}
\end{array}\) $\begin{array}{c}
\text { BLUE SHOE, INC. } \
\text { Consolidated Statement of Income } \
\text { January 3, 2014 } \
\text { (in millions) } \
\begin{array}{|l|r|}
\hline \text { Revenues } & \$ 133.5 \
\hline \text { Cost of sales } & 87.3 \
\hline \text { Gross profit } & 46.2 \
\hline \text { Operating expenses } & 37.3 \
\hline \text { Operating income } & 8.9 \
\hline \text { Interest expense } & (0.1) \
\hline \text { Other revenues and expenses } & 0.3 \
\hline \text { Income before tax } & 9.1 \
\hline \text { Income taxes } & 3.9 \
\hline \text { Net income } & \$ 5.2\
\hline
\end{array}
\end{array}$
 (1)For both companies compute the following ratios for 2014:
(a)Current ratio
(b)Acid-test ratio
(c)Accounts receivable turnover
(d)Inventory turnover
(e)Days' sales in inventory
(f)Days' sales uncollected
Which company do you consider to be the better short-term credit risk? Explain.
(2)For both companies compute the following ratios for 2014:
(a)Profit margin ratio
(b)Return on total assets
(c)Return on common stockholders' equity
Which company do you consider to have better profitability ratios?

Accepted Answer

The answer of The following are summaries from the income...

Question 7

Use the following information from the current year financial statements of a company to calculate the ratios below:
(a)Current ratio.
(b)Accounts receivable turnover.(Assume the prior year's accounts receivable balance was $100,000.)
(c)Days' sales uncollected.
(d)Inventory turnover.(Assume the prior year's inventory was $50,200.)
(e)Times interest earned ratio.
(f)Return on common stockholders' equity.(Assume the prior year's common stock balance was $480,000 and the retained earnings balance was $128,000.)
(g)Earnings per share (assuming the corporation has a simple capital structure, with only common stock outstanding).
(h)Price earnings ratio.(Assume the company's stock is selling for $26 per share.)
(i)Divided yield ratio.(Assume that the company paid $1.25 per share in cash dividends.)
$\begin{array}{l}
\text { Income statement data: }\
\begin{array}{|l|r|}
\hline \text { Sales (all on credit) } & \$ 1,075,000 \
\hline \text { Cost of goods sold } & 575,000 \
\hline \text { Gross profit on sales } & \$ 500,000 \
\hline \text { Operating expenses } & \underline{305,000} \
\hline \text { Operating income } & \$ 195,000 \
\hline \text { Interest expense } & 20,400 \
\hline \text { Income before taxes } & \$ 174,600 \
\hline \text { Income taxes } & 74,000 \
\hline \text { Net income } & \$ 100,600 \
\hline
\end{array}
\end{array}$
 $\begin{array}{l}

\begin{array}{|l|r|}
\hline \text { Balance sheet data: }\
\hline \text { Cash } & \$ 38,400 \
\hline \text { Accounts receivable } & 120,000 \
\hline \text { Inventory } & 56,700 \
\hline \text { Prepaid Expenses } & 24,000 \
\hline \text { Total current assets } & \$ 239,100 \
\hline \text { Total plant assets } & 708,900 \
\hline \text { Total assets } & \$ 948,000 \
\hline \text { Accounts payable } & \$ 91,200 \
\hline \text { Interest payable } & 4,800 \
\hline \text { Long-term liabilities } & 204,000 \
\hline \text { Total liabilities } & \$ 300,000 \
\hline \text { Common stock, } \$ 10 \text { par } & 480,000 \
\hline \text { Retained earnings } & 168,000 \
\hline \text { Total liabilities and equity } & \$ 948,000 \
\hline
\end{array}
\end{array}$

Accepted Answer

The answer of Use the following information from the current...

Question 8

The 2014 income statement for Golden Company is shown below:
$\begin{array}{c}
 \text {GOLDEN COMPANY  } \
 \text { Income Statements } \
 \text { For the Year Ended December 31, 2014 } \
\begin{array}{|l|r|}
\hline\
\hline \text { Sales } & \$ 720,000 \
\hline \text { Cost of goods sold } & 450,000 \
\hline \text { Gross profit } & \$ 270,000 \
\hline \text { Operating expense } & 168,500 \
\hline \text { Income from operations } & \$ 101,500 \
\hline \text { Interest expense } & 22,300 \
\hline \text { Income before taxes } & \$ 79,200 \
\hline \text { Income taxes } & 28,000 \
\hline \text { Net income } & 51,200 \
\hline
\end{array}
\end{array}$
 Calculate the times interest earned ratio for 2014.

Accepted Answer

The answer of The 2014 income statement for Golden Company...

Question 9

A company has a current ratio of 1.92, total liabilities of $193,849, long-term notes payable of $85,791, and a quick ratio of .96.What are total current assets for the company?

Accepted Answer

1.92 = Current assets/($193,849 - $85,791)
Current assets = $207,471

Question 10

A company paid cash dividends on its preferred stock of $40,000 in the current year when its net income was $120,000 and its average common stockholders' equity was $640,000.What is the company's return on common stockholders' equity?

Accepted Answer

The answer of A company paid cash dividends on its...

Question 11

Information from a manufacturing company's current year income statement follows:
 $\begin{array}{|l|r|}
\hline \text { Sales } & \$ 800,000 \
\hline \text { Cost of goods sold } & 455,000 \
\hline \text { Gross profit } & \$ 345,000 \
\hline \text { Operating expenses } & 265,000 \
\hline \text { Operating income } & \$ 80,000 \
\hline \text { Interest expense } & \underline{32,000} \
\hline \text { Income before taxes } & \$ 48,000 \
\hline \text { Income taxes expense } & \underline{12,400 }\
\hline \text { Net income } & \underline{\$ 35,600} \
\hline
\end{array}$ Calculate the company's times interest earned.

Accepted Answer

The answer of Information from a manufacturing company's current year...

Question 12

Comparative calendar-year financial data for a company are shown below:
 $$\begin{array} { | l | r | r | } 
\hline & { 2014 } & 2013 \
\hline \text { Sales } & \$ 720,000 & \$ 607,500 \
\hline \text { Cost of goods sold } & 450,000 & 382,700 \
\hline \text { Operatirg experses } & 168,500 & 134,900 \
\hline \text { Net iricome } & 51,200 & 51,700 \
\hline & & \
\hline & \text { Decerrber 31, } & \text { Decerrber 31, } \
\hline & 2014 & 2013 \
\hline \text { Accourts receivable (net } & \$ 157,500 & \$ 162,500 \
\hline \text { Irventory } & 139,500 & 110,500 \
\hline \text { Total assets } & 1,012,500 & 944,800 \
\hline
\end{array}$$ Calculate:
(1)Accounts receivable turnover for 2014.
(2)Days' sales uncollected for 2014.
(3)Inventory turnover for 2014.
(4)Days' sales in inventory for 2014.

Accepted Answer

The answer of Comparative calendar-year financial data for a company...

Question 13

Use the financial data shown below to calculate the following ratios for the current year:
(a)Current ratio
(b)Acid-test ratio
(c)Accounts receivable turnover
(d)Days' sales uncollected
(e)Inventory turnover
(f)Days' sales in inventory
 $$\begin{array}{l}

\begin{array} { | l | r | r | } 
\hline \text { Income statenernt data }\
\hline \text { Sales } & \$ 650,000 & \
\hline \text { Cost of goods sold } & 425,000 & \
\hline \text { Income before taxes } & 78,000 & \
\hline \text { Net incorne } & 54,600 & \
\hline & & \
\hline &\begin{array} { c } 
\text { Ending } \
\text { Balances }
\end{array} & \begin{array} { c } 
\text { Begirning } \
\text { Balances }
\end{array} \
\hline \text { Cash } & \$ 19,500 & \$ 15,000 \
\hline \text { Accounts receivable (net) } & 65,000 & 60,000 \
\hline \text { Irventory } & 71,500 & 64,500 \
\hline \text { Plart and equipment (net) } & \underline { 195,000 } & \underline { 183,900 } \
\hline \text { Total assets } & \$ 351,000 & \$ 323,400 \
\hline & & \
\hline \text { Current liabilities } & \$ 62,400 & \$ 52,700 \
\hline \text { Lone-temn notes payable } & 97,500 & 100,000 \
\hline
\end{array}
\end{array}$$

Accepted Answer

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Question 14

A company has a current ratio of 3.4, total liabilities of $350,240 and long-term notes payable of $120,000.What are total current assets for the company?

Accepted Answer

The answer of A company has a current ratio of...

Question 15

The following selected company information was reported:
 $$\begin{array} { | l | r | } 
\hline \text { Accourits receivable, begirning-year } & \$ 170,000 \
\hline \text { Accourts receivable, year-end } & 190,000 \
\hline \text { Merchardise irventory, begirning-year } & 80,000 \
\hline \text { Merchardise irventory, year-end } & 60,000 \
\hline \text { Cost of goods sold } & 580,000 \
\hline \text { Credit sales } & 1,000,000 \
\hline
\end{array}$$ Calculate the following company ratios:
(a)Accounts receivable turnover
(b)Inventory turnover
(c)Days' sales uncollected

Accepted Answer

The answer of The following selected company information was reported:
...

Question 16

The current year-end balance sheet data for a company are shown below:
 $\begin{array}{|l|r|}
\hline \text { Assets: } \
\hline \text { Cash } & \$ 18,000 \
\hline \text { Marketable securities } & 45,000 \
\hline \text { Accounts receivable (net) } & 157,500 \
\hline \text { Merchandise inventory } & 139,500 \
\hline \text { Long-term investments } & 135,000 \
\hline \text { Plant assets (net) } & \underline { 517,500} \
\hline \text { Total assets } & \underline { \$ 1,012,500} \
\hline\
\hline \text { Liabilities and equity: }\
\hline \text { Accounts payable } & \$ 168,700 \
\hline \text { Accrued liabilities } & 90,000 \
\hline \text { Notes payable (secured by plant assets) } & 234,800 \
\hline \text { Common stock (\$12par) } & 180,000 \
\hline \text { Contributed capital in excess of par } & 135,000 \
\hline \text { Retained earnings } & 204,000 \
\hline \text { Total liabilities and equity } & \underline { \$ 1,012,500} \
\hline
\end{array}$ Calculate this company's:
(1)Working capital
(2)Acid-test ratio

Accepted Answer

The answer of The current year-end balance sheet data for...

Question 17

The following information is from Omega Corporation's balance sheets as of December 31, 2013 and 2014 and its income statement for 2014:
 $\begin{array}{|l|r|r|}
\hline &2014 & 2013 \
\hline \text { Assets: }&& \
\hline \text { Cash } & \$ 18,000 & \$ 22,000 \
\hline \text { Marketable securities } & 25,000 & 0 \
\hline \text { Accounts receivable } & 38,000 & 42,000 \
\hline \text { Inventory } & 61,000 & 52,000 \
\hline \text { Prepaid insurance } & 6,000 & 9,000 \
\hline \text { Long-term investments } & 49,000 & 20,000 \
\hline \text { Plant assets, net } & 218,000 & 225,000 \
\hline \text { Total assets } & \$ 415,000 & \$ 370,000 \
\hline\
\hline \text { Net income } & \$ 62,250 \
\hline \text { Sales (all on credit) } & 305,000 \
\hline \text { Cost of goods sold } & 123,000 \
\hline \text { Interest expense } & 15,600 \
\hline \text { Income tax expense } & 27,000 \
\hline
\end{array}$ From the above information, calculate the following ratios for 2014:
(a)Inventory turnover.
(b)Accounts receivable turnover.
(c)Return on total assets.
(d)Times interest earned.
(e)Total asset turnover.

Accepted Answer

The answer of The following information is from Omega Corporation's...

Question 18

A company reported net income of $78,000 and had 15,000 common shares outstanding throughout the current year.At year-end, the price per share of the company's stock was $49.40.What is the company's year-end price-earnings ratio?

Accepted Answer

The answer of A company reported net income of $78,000...

Question 19

Selected current year company information follows:
 $$\begin{array} {| l | r| } 
\hline \text { Net incorne } & \$ 325,000 \
\hline \text { Net sales } & 4,700,000 \
\hline \text { Total liabilities, begirring-year } & 550,000 \
\hline \text { Total liabilities, end-of-year } & 530,000 \
\hline \text { Total stockholders' equity, begirring-year } & 760,000 \
\hline \text { Total stockholders' equity, end-of-year } & 745,000 \
\hline
\end{array}$$ Calculate the following company ratios:
(a)Profit margin.
(b)Total asset turnover.
(c)Return on total assets.
(d)Return on common stockholders' equity (assume the company has no preferred stock).

Accepted Answer

The answer of Selected current year company information follows:
 \[\begin{array}...

Question 20

A corporation reports the following year-end balance sheet data:
 $$\begin{array} { | l | r | l | r | } 
\hline \text { Cash } & \$ 40,000 & \text { Current liabilities } & \$ 64,000 \
\hline \text { Accourts receivable } & 35,000 & \text { Lone-term liabilities } & 72,000 \
\hline \text { Irvventory } & 60,000 & \text { Corrmon stock } & 100,000 \
\hline \text { Equiprnent } &  \underline { 150,000} & \text { Retaired earnings } &  \underline { 49,000} \
\hline \text { Total assets } &  \underline { \$ 285,000} & \text { Total liabilities and equity } &  \underline { \$ 285,000} \
\hline
\end{array}$$ Calculate the corporation's current ratio and its acid-test ratio.

Accepted Answer

The answer of A corporation reports the following year-end balance...

Quiz 13: Analyzing Financial Statements

Explain where the following item should appear in the financial statements of a corporation: One of the company's plants was destroyed by an earthquake.The area has never reported an earthquake.The amount of the loss, net of tax, was $850,000.

A company has a current ratio of 1.92, total liabilities of $193,849, long-term notes payable of $85,791, and a quick ratio of .96.What are total current assets for the company?

A company paid cash dividends on its preferred stock of $40,000 in the current year when its net income was $120,000 and its average common stockholders' equity was $640,000.What is the company's return on common stockholders' equity?

A company has a current ratio of 3.4, total liabilities of $350,240 and long-term notes payable of $120,000.What are total current assets for the company?

A company reported net income of $78,000 and had 15,000 common shares outstanding throughout the current year.At year-end, the price per share of the company's stock was $49.40.What is the company's year-end price-earnings ratio?