(a) Use the data in Problem and Case 4.11. Calculate the two liquidity ratios for Creative Advertising...
Question:
(b) What can you conclude from these ratios?
In problem
Transcribed Image Text:
Creative Advertising Limited Income Statement for the year ended December 31, 2010 400,000 210,000 190,000 75,000 s 115,000 Sales Cost of goods sold Gross profit Expenses (excluding interest) EBIT Interest expense EBT Income tax expense (40%) Net income Preferred dividends Net income available to common shareholders 2009 350,000 185,000 s 165,000 55,000 s 110,000 20,000 $ 90,000 36,000 S 54,000 2,000 $ 52,000 $ 95,000 38,000 $ 57,000 2.000 S 55,000 Creative Advertising Limited Statement of Retained Earnings for the year ended December 31 Opening retained earnings Net income available to common shareholders Dividends to common shareholders Closing retained earnings 2010 35,000 55,000 10,000 $ 80,000 2009 $ (7,000) 52,000 10,000 35,000 Creative Advertising Limited Balance Sheet as at December 31, 2010 2009 Assets Current assets Cash Accounts receivable Inventory Total current assets Property, plant, and equipment Intangible assets Total assets 25,000 50,000 50,000 125,000 500,000 50,000 $675,000 15,000 40,000 45,000 100,000 400,000 35,000 $535,000
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 68% (22 reviews)
Creative Advertising Limited a The liquidity ratios for ...View the full answer
Answered By
Qurat Ul Ain
Successful writing is about matching great style with top content. As an experienced freelance writer specialising in article writing and ghostwriting, I can provide you with that perfect combination, adapted to suit your needs.
I have written articles on subjects including history, management, and finance. Much of my work is ghost-writing, so I am used to adapting to someone else's preferred style and tone. I have post-graduate qualifications in history, teaching, and social science, as well as a management diploma, and so am well equipped to research and write in these areas.
4.80+
265+ Reviews
421+ Question Solved
Related Book For
Financial Management for Decision Makers
ISBN: 978-0138011604
2nd Canadian edition
Authors: Peter Atrill, Paul Hurley
Question Posted:
Students also viewed these Finance questions
-
(a) Use the data in Problem and Case 4.11. Calculate the leverage ratio and the times interest earned ratio for Creative Advertising Limited for 2010. Treat the preferred shares the same as long-term...
-
(a) Use the data in Problem and Case 4.11. Calculate five investment ratios, including the dividend cover ratio, for Creative Advertising Limited for 2010, given that there was an average of 50,000...
-
(a) Use the data in Problem and Case 4.11. Redo Problems and Cases 4.11 to 4.15 for 2009. Where an average figure is needed, assume the opening amount and closing amounts are the same. In problem...
-
A 16 lb weight is attached to a spring with a spring constant equal to 2 lb/ft. Neglect damping. The weight is released from rest at 3 ft below the equilibrium position. At t = 2r sec, it is struck...
-
How would you attempt to assess whether the technology used by an industry in a developing country was inappropriate?
-
The log-mean temperature difference can be a negative quantity if one is boiling or condensing.
-
Potential flow against a flat plate (Fig. P6.51a) can be described with the stream function \[ \psi=A x y \] where \(A\) is a constant. This type of flow is commonly called a stagnation point flow...
-
Here are some numbers that you can use to sharpen your computational skills for sample size determination. Crest Toothpaste is reviewing plans for its annual survey of toothpaste purchasers. With...
-
Determine the missing manufacturing cost data for Sunland Company as presented below. (Assume all raw materials used were direct materials.) Case A Case B Case C Direct materials used (a) $87,500...
-
1. A cart on wheels weighs 2400 N. The coefficient of rolling friction between the wheels and floor is 0.16. What force is needed to keep the cart rolling uniformly? 2. A wooden crate weighs 780 lb....
-
Use the data in Problem and Case 4.11. The notes to the financial statements indicated that 80% of the sales for Creative Advertising Limited were credit sales. In problem Inventory purchases, 90% of...
-
Use your answers to Problems and Cases 4.11 to 4.16 to summarize the results for all the ratios for 2009 and 2010. Discuss the results of your ratio analysis. Recommend any action you think Creative...
-
Given two sets A and B represented as sorted sequences, describe an efficient algorithm for computing AB, which is the set of elements that are in A or B, but not in both.
-
If the period of a sound wave is 10s, what is its frequency? (assume its speed is 343m/s) . What is the wavelength?
-
Selected financial data for Skysong Inc. and Concord Ltd. (in $ thousands) a Statement of Income Total revenue Cost of sales Gross profit Operating expenses. Profit from operations Interest expense...
-
Discuss the terms multitasking , multiprocessing , and multithreading . Give an example of each to illustrate your thoughts?
-
What leadership practices can be implemented to help prevent or mitigate these challenges? Which aspects of cross-cultural leadership do you think would be the most effective when applied to criminal...
-
Which of the following statements with regard to the ITA 54 definition of a principal residence is correct? Choose the correct answer. A. The definition of principal residence excludes land,...
-
In October 2005, Blatt was diagnosed with Gender Dysphoria, also known as Gender Identity Disorder, which she argues substantially limits one or more of her major life activities, including, but not...
-
If a test has high reliability. O the test measures what the authors of the test claim it measures O people who take the same test twice get approximately the same scores both times O scores on the...
-
Should managers take changes in the total market value of the shares (that is, share price number of shares issued) over time as an indicator of shareholder value created (or lost)? Why?
-
If the net present value of future cash flows generated by the business represents the value of the business as a whole, how can we derive that part of the value of the business that is available to...
-
Devonian plc has the following long-term capital structure as at 30 November Year 4: The business has no long-term loans. In the year to 30 November Year 4, the operating profit (profit before...
-
How is decision-making in organizations best supported by Management Accounting (a descriptive nature) and how should it be supported by Management Accounting (a prescriptive nature)? Is there a gap...
-
Discuss the thermodynamic principles governing the separation of azeotropic mixtures using advanced distillation techniques such as pressure swing distillation, extractive distillation, and hybrid...
-
respond to the discussion In the IMA article, Activity-Based Costing (ABC) is explained as a cost allocation technique that traces indirect costs (often referred to as "overhead") to specific cost...
Study smarter with the SolutionInn App