Creek Enterprises' 2014 operations follows: Using the firm's 2015 income statement presented in Problem 3-18, develop the
Question:
Common-Size Income Statement for the Year Ended December 31, 2014 Sales revenue ($35,000,000) Less: Cost of goods sold 100.0% Gross profits Less: Operating expenses Selling expense General and administrative expenses 12.7% 6.3 0.6 Depreciation expense Total operating expense Less: Interest expense Less: Taxes (rate-40%) Less: Preferred stock dividends Operating profits Net profits before taxes Net profits after taxes Earnings available for common stockholders 10.9% 9.4% 5.6% 5% 0.1 -
Step by Step Answer:
Creek Enterprises CommonSize Income Statement for the Years Ended December 31 2014 and 2015 20...View the full answer
Principles of Managerial Finance
ISBN: 978-0133507690
14th edition
Authors: Lawrence J. Gitman, Chad J. Zutter
Related Video
Depreciation of non-current assets is the process of allocating the cost of the asset over its useful life. The cost of the asset includes the purchase price, any additional costs incurred to bring the asset to its current condition and location, and any other costs that are directly attributable to the asset. The useful life of the asset is the period over which the asset is expected to be used by the company. To calculate the depreciation, companies use different methods such as straight-line, declining-balance, sum-of-the-years\'-digits, units-of-production, and group depreciation. The chosen method will depend on the type of asset, the company\'s accounting policies, and the accounting standards that are applicable. The straight-line method allocates an equal amount of the asset\'s cost over its useful life, while the declining-balance method calculates depreciation at a fixed rate, typically double the straight-line rate, but the amount of depreciation decreases over time. The sum-of-the-years\'-digits method is similar to the declining-balance method, but the rate of depreciation is calculated using a fraction that is based on the useful life of the asset. It\'s important to note that the depreciation expense will be recorded on the company\'s income statement and the accumulated depreciation will be recorded on the company\'s balance sheet. This will decrease the value of the asset on the balance sheet over time.
Students also viewed these Finance questions
-
A common-size income statement for Creek Enterprises 2011 operations follows. Using the firms 2012 income statement presented in Problem 318, develop the 2012 common-size income statement and compare...
-
A common-size income statement for Aluminum Industries 2011 operations follows. Using the firms 2012 income statement presented in Problem 2-4, develop the 2012 common-size income statement (see...
-
A common-size income statement for Creek Enterprises 2018 operations follows. Using the firms 2019 income statement presented in Problem 316, develop the 2019 common-size income statement and compare...
-
Write a critical review paper on the topic of financial management in the broad sense.
-
Mexican companies traditionally guarded their information and were secretive in their financial reporting. What evidence is there that Mexican-companies are becoming less secretive?
-
John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2020, John worked as a computer technician at a local university earning a salary of $152,000, and...
-
What factors should be considered by the auditor in analyzing occurrences found in the sample?
-
Flowmaster Forge Inc. is a designer and manufacturer of industrial air-handling equipment that is a wholly owned subsidiary of Howden Industrial Inc. Howden is interested in selling Flowmaster to an...
-
1. This short CNN video provides the facts and significant details of Malcolm X influence and his death. In an essay, express your impressions and the key details of the biography that captured your...
-
1. Smith, an unemployed engineer who recently received certification as an engineerintern from the State Board of Registration for Engineers and Land Surveyors, was seeking employment with a...
-
In early 2013, Pepsi reported revenues of $65.64 billion with earnings available for common stockholders of $6.12 billion. Pepsi's total assets at the time were $74.64 billion. Meanwhile, one of...
-
Complete ratio analysis, recognizing significant differences Home Health, Inc., has come to Jane Ross for a yearly financial checkup. As a first step, Jane has prepared a complete set of ratios for...
-
Discuss possible local extrema and absolute extrema on the graph of f. Assume that a > 0. f(x) = ax + bx + c
-
Consider the following two causes of a 1-second network delay (assume ACKs return instantaneously): one intermediate router with a 1-second outbound per-packet bandwidth delay and no competing...
-
How do routers determine that an incoming IP packet is to be multicast?
-
Use an OpenPGP implementation such as GnuPG to do the following. Note that no email is involvedyou are working exclusively with files on a single machine. (a) Generate a publicprivate key pair. (b)...
-
Suppose two people want to play poker over the network. To deal the cards, they need a mechanism for fairly choosing a random number x between them; each party stands to lose if the other party can...
-
What are the peculiarities of CBA approach adopted by the EIB?
-
A block is released from rest and slides down an incline. The coefficient of sliding friction is 0.38, and the angle of inclination is 60.0. (a) Use energy considerations to find how fast the block...
-
What is the maximum volume of 0.25 M sodium hypochlorite solution (NaOCl, laundry bleach) that can be prepared by dilution of 1.00 L of 0.80 M NaOCl?
-
Douglas Keel, a financial analyst for Orange Industries, wishes to estimate the rate of return for two similar-risk investments, X and Y. Douglass research indicates that the immediate past returns...
-
For each of the investments shown in the following table, calculate the rate of return earned over the unspecified timeperiod. Cash flow Beginning-of End-of pcriod valuc S 100 118,000 Investment...
-
Sharon Smith, the financial manager for Barnett Corporation, wishes to evaluate three prospective investments: X, Y, and Z. Sharon will evaluate each of these investments to decide whether they are...
-
Diaz Company issued $91,000 face value of bonds on January 1, Year 1. The bonds had a 9 percent stated rate of interest and a ten- year term. Interest is paid in cash annually, beginning December 31,...
-
Manvir had to make payments of $1,125 every 6 months to settle a $22,000 loan that he received at 4.52% compounded semi-annually. a. How long did it take to settle the loan?
-
If I invest a single amount of $14,000 in an account earning 8% p.a. compounding quarterly for 5 years, how much interest will I have earned in those 5 years?
Study smarter with the SolutionInn App