(1) Company has income from continuing operations of $266,000 for the year ended December 31, 2020. It also has the following items (before considering income taxes).

1.An unrealized loss of $76,000 on available-for-sale securities.

2.A gain of $35,000 on the discontinuance of a division (comprised of a $12,000 loss from operations and a $47,000 gain on disposal).

Assume all items are subject to income taxes at a 15% tax rate.

Please help with statement of comprehensive income, beginning with income from continuing operations. (8 total options to fill)

(2) Suppose the comparative balance sheets of company are presented here. Company May 31 ($in millions)

Assets:  2020 and 2019

Current assets ($9,191; $9,100)

Property, plant, and equipment (net) ($2,163; $2,100)

Other assets ($1,568; $1,600)

Total assets ($12,922; $12,800)

Liabilities and Stockholders’ Equity

Current liabilities ($3,201; $3,300)

Long-term liabilities ($1,235; $1,300)

Stockholders’ equity ($8,486; $8,200)

Total liabilities and stockholders’ equity ($12,922; $12,800)

(a) Please help with horizontal analysis of the balance sheet data for company, using 2019 as a base. (Show the amount of increase or decrease as well.)

2020:2019:Inc/Decrease:% Change from 2019:

Assets: $9,191$9,100??

Current assets$2,163$2,100??

Property, plant, and equipment (net)$1,568$1,600??

Other assets$12,922$12,800??

Total assets

Liabilities and Stockholders’ Equity:

Current liabilities$3,201$3,300??

Long-term liabilities$1,235$1,300??

Stockholders’ equity$8,486$8,200??

Total liabilities and stockholders’ equity$12,922$12,800??

(b) Please help with vertical analysis of the balance sheet data for Company for 2020.

$(in millions):Percent:

Assets:

Current assets$9,191?

Property, plant, and equipment (net)$2,163?

Other assets$1,568?

Total assets$12,922?

Liabilities and Stockholder’s Equity:

Current liabilities$3,201?

Long-term liabilities$1,235?

Stockholder’s equity$8,486?

Total liabilities and stockholder’s equity$12,922?

(3)  Here are the comparative income statements of Company.

20202019

Net Sales$775,000$651,000

Cost of Goods Sold$604,500$524,706

Gross Profit$170,500$126,294

Operating Expenses$106,175$59,892

Net Income$64,325$66,402

(a)  Please help with horizontal analysis of the income statement data for Company, using 2019 as a base. (Show the amounts of increase or decrease.)

2020 2019AmountPercent

Net Sales $775,000$651,000??

Cost of Goods Sold$604,500$524,706??

Gross Profit $170,500$126,294??

Operating Expenses$106,175$59,892??

Net Income$64,325 $66,402??

(b) Please help with Do a vertical analysis of the income statement data for Company for both years.

2020 2019

Amount % Amount %

Net Sales $775,000?$651,000 ?

Cost of Goods Sold$604,500?$524,706?

Gross Profit $170,500?$126,294 ?

Operating Expenses$106,175?$59,892 ?

Net Income $64,325 ?$66,402 ?

(4) The comparative statements of Company are presented here.

20202019

Net sales$1,810,600$1,746,200

Cost of goods sold$1,012,200$984,000

Gross profit$798,400$762,200

Sell/admin exp$515,200$479,600

Income from operations$283,200$282,600

Other expenses/losses

Interest expense$17,300$13,300

Income before taxes$265,900$269,300

Income tax expense$81,100$76,300

Net income$184,800$193,000

Assets 20202019

Current assets

Cash$59,500$63,100

Debt investments $68,200$49,800

Accounts receivable$117,100$102,100

Inventory$124,000$114,400

Total current assets$368,800$329,400

Plant assets (net)$598,600$519,300

Total assets$967,400$848,700

Liabilities and Stockholders’ Equity

Current liabilities

Accounts payable$159,200$144,800

Income taxes payable $43,800$41,200

Total current liabilities $203,000$186,000

Bonds payable$220,000$200,000

Total liabilities$423,000$386,000

Stockholders’ equity

Common stock ($5 par)$278,300$299,200

Retained earnings$ 266,100$163,500

Total stockholders’ equity$544,400$462,700

Total liabilities and stockholders’ equity$967,400$848,700

All sales were on account. Net cash provided by operating activities for 2020 was $225,000. Capital expenditures were $141,000, and cash dividends were $82,200.

Compute the following ratios for 2020. (Round Earnings per share, Current ratio and Asset turnover to 2 decimal places, e.g. 1.65 or 1.65:1, and all other answers to 1 decimal place, e.g. 6.8 or 6.8%. Use 365 days for calculation.)

(a) $?

(b) %?

(c) %?

(d) ?:1

(e) times?

(f) days?

(g) times?

(h) days?

(i) time?

(j) time?

(k) %?

(l) $?

(5)  Condensed balance sheet and income statement data for Company are presented here.

202020192018

Cash$ 30,800$ 17,600$ 18,700

Accounts receivable $50,500$44,200$47,100

Other current assets$89,600$94,900$63,900

Investment$55,300$71,000$45,100

Plant and equipment $500,500$370,000$358,500

$726,700$597,700$533,300

Current liabilities$85,500$79,800$69,400

Long-term debt$144,300$84,100$50,300

Common stock, $10 $348,000$316,000$304,000

Retained earnings$148,900$117,800$109,600

$726,700$597,700$533,300

20202019

Sales revenue$738,000$605,500

Less: Sales returns and allowances$39,100$29,900

Net sales$698,900$575,600

Cost of goods sold$425,600$367,000

Gross profit$273,300$208,600

Operating expenses (including income taxes)$182,443$151,040

Net income$90,857$57,560

Additional information:

1.The market price of Company’s common stock was $7.00, $7.50, and $8.50 for 2018, 2019, and 2020, respectively.

2.You must compute dividends paid. All dividends were paid in cash.

(a)

Compute the following ratios for 2019 and 2020.

20192020

(1)  Profit Margin%?%?

(2)  Gross Profit Rate%?%?

(3)  Asset Turnovertimes?times?

(4)  Earnings/share$?$?

(5)  Price-earnings ratiotimes?times?

(6)  Payout ratio%?%?

(7)  Debts to assets ratio%?%?

Answer rating: 100% (QA)

ANSWER 2 a 2b 3 a 3 b 1 Income from Continuing Operations Less Unrealised Loss Add Gain on discontin... View the full answer