The income statement and balance sheet are the primary reports that a firm constructs for use...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The income statement and balance sheet are the primary reports that a firm constructs for use by management and for distribution to stockholders, regulatory bodies, and the general public. They are the primary sources of historical financial information about the firm. Dayton Products Inc. is a moderate-sized manufacturer. The company's man- agement has asked you to perform a detailed financial statement analysis of the firm. The income statements for the years ending December 31, 2019 and 2018, respectively, are presented in the following table. Annual Income Statements (Values in Millions) Sales Cost of goods sold Selling, general, and administrative expenses Other tax expense Depreciation and amortization Other income (add to EBIT to arrive at EBT) Interest expense Income tax rate Dividends paid per share Basic EPS from total operations For the year ended December 31, 2019 December 31, 2018 $178,909 109,701 12,356 33,572 12,103 3,147 398 21% $1.15 $1.64 $187,510 111,631 12,900 33,377 7,944 3,323 293 21% $0.91 $2.87 You also have the following balance sheet information as of December 31, 2019 and 2018, respectively. Cash Receivables Inventories Annual Balance Sheets (Values in Millions) December 31, 2019 $ 9,090 21,163 8,068 1,831 204,960 110,020- 19,413 13,792 4,093 15,290 6,655 16,484 21,733 76,458 Other current assets Property, plant, and equipment, gross Accumulated depreciation and depletion Other noncurrent assets Accounts payable Short-term debt payable Other current liabilities Long-term debt payable Deferred income taxes Other noncurrent liabilities. Retained earnings Total common shares outstanding 6.7 billion December 31, 2018 $ 6,547 19,549 7,904 1,681 187,519 97,917 17,891 22,862 3,703 3,549 7,099 16,359 16,441 73,161 TILLER 6.8 billion TO DO a. Create a spreadsheet similar to Table 3.1 to model the following: (1) A multiple-step comparative income statement for Dayton Inc. for the peri- ods ending December 31, 2019 and 2018. You must calculate the cost of goods sold for the year 2019. (2) A common-size income statement for Dayton Inc. covering the years 2019 and 2018. b. Create a spreadsheet similar to Table 3.2 to model the following: (1) A detailed, comparative balance sheet for Dayton Inc. for the years ended. December 31, 2019 and 2018. (2) A common-size balance sheet for Dayton Inc. covering the years 2019 and 2018. c. Create a spreadsheet similar to Table 3.10 to perform the following analysis: (1) Create a table that reflects both 2019 and 2018 operating ratios for Dayton Inc., segmented into (a) liquidity, (b) activity, (c) debt, (d) profitability, and (e) market. Assume that the current market price for the stock is $90. (2) Compare the 2019 ratios to the 2018 ratios. Indicate whether the results "outperformed the prior year" or "underperformed relative to the prior year." The income statement and balance sheet are the primary reports that a firm constructs for use by management and for distribution to stockholders, regulatory bodies, and the general public. They are the primary sources of historical financial information about the firm. Dayton Products Inc. is a moderate-sized manufacturer. The company's man- agement has asked you to perform a detailed financial statement analysis of the firm. The income statements for the years ending December 31, 2019 and 2018, respectively, are presented in the following table. Annual Income Statements (Values in Millions) Sales Cost of goods sold Selling, general, and administrative expenses Other tax expense Depreciation and amortization Other income (add to EBIT to arrive at EBT) Interest expense Income tax rate Dividends paid per share Basic EPS from total operations For the year ended December 31, 2019 December 31, 2018 $178,909 109,701 12,356 33,572 12,103 3,147 398 21% $1.15 $1.64 $187,510 111,631 12,900 33,377 7,944 3,323 293 21% $0.91 $2.87 You also have the following balance sheet information as of December 31, 2019 and 2018, respectively. Cash Receivables Inventories Annual Balance Sheets (Values in Millions) December 31, 2019 $ 9,090 21,163 8,068 1,831 204,960 110,020- 19,413 13,792 4,093 15,290 6,655 16,484 21,733 76,458 Other current assets Property, plant, and equipment, gross Accumulated depreciation and depletion Other noncurrent assets Accounts payable Short-term debt payable Other current liabilities Long-term debt payable Deferred income taxes Other noncurrent liabilities. Retained earnings Total common shares outstanding 6.7 billion December 31, 2018 $ 6,547 19,549 7,904 1,681 187,519 97,917 17,891 22,862 3,703 3,549 7,099 16,359 16,441 73,161 TILLER 6.8 billion TO DO a. Create a spreadsheet similar to Table 3.1 to model the following: (1) A multiple-step comparative income statement for Dayton Inc. for the peri- ods ending December 31, 2019 and 2018. You must calculate the cost of goods sold for the year 2019. (2) A common-size income statement for Dayton Inc. covering the years 2019 and 2018. b. Create a spreadsheet similar to Table 3.2 to model the following: (1) A detailed, comparative balance sheet for Dayton Inc. for the years ended. December 31, 2019 and 2018. (2) A common-size balance sheet for Dayton Inc. covering the years 2019 and 2018. c. Create a spreadsheet similar to Table 3.10 to perform the following analysis: (1) Create a table that reflects both 2019 and 2018 operating ratios for Dayton Inc., segmented into (a) liquidity, (b) activity, (c) debt, (d) profitability, and (e) market. Assume that the current market price for the stock is $90. (2) Compare the 2019 ratios to the 2018 ratios. Indicate whether the results "outperformed the prior year" or "underperformed relative to the prior year."
Expert Answer:
Answer rating: 100% (QA)
Dayton Products Inc Multistep Income Stat 1 Comparative 2 Common size For the year ended For the year ended 31Dec19 31Dec18 31Dec19 31Dec18 Sales 1789... View the full answer
Related Book For
Understanding financial statements
ISBN: 978-0136086246
9th Edition
Authors: Lyn M. Fraser, Aileen Ormiston
Posted Date:
Students also viewed these accounting questions
-
Presented here are an incomplete income statement and balance sheet for Vieux Corporation. Additional information: 1. The gross profit margin is 40%. 2. The profit margin is 15%. 3. The receivables...
-
Presented here are an incomplete income statement and balance sheet for Vieux Corporation. VIEUX CORPORATION Income Statement Year ended December 31, 2014 Net sales ..........................
-
The following is Folex Company's income statement and balance sheet (in millions): The following additional information is available: i) Operating expenses include $35 million of depreciation. ii)...
-
Requests are not usually uniformly distributed. For example, a cylinder containing the file system FAT or in odes can be expected to be accessed more frequently than a cylinder that only contains...
-
To what extent have increases in U.S. real GDP resulted from more labor inputs? From higher labor productivity? Rearrange the following contributors to the growth of productivity in order of their...
-
With n = 50 guesses and p = 0.2 for a correct answer, find P(exactly 12 correct answers). If the requirements of np 5 and nq 5 are both satisfied, estimate the indicated probability by using the...
-
Use the data in Exercise 25 in Section 13.1 for the following. a. Compute a point estimate for the mean vertical expansion at locations where the horizontal expansion is 25. b. Construct a 99%...
-
The cash records of Dawes Company show the following four situations. 1. The June 30 bank reconciliation indicated that deposits in transit total $920. During July, the general ledger account Cash...
-
10. You operate an inland water transport service and hypothesize that your average costs per cargo ton-mile of operation (AVCOST) depend upon the average length of haul (AVH) and route density...
-
5 Bernard L. Madoff, through BLMIS, operated a Ponzi scheme inducing investors to open discretionary trading accounts with BLMIS for the ostensible purpose of buying and selling securities. No...
-
Joni Tamarisk Inc. has the following amounts reported in its general ledger at the end of the current year. Organization costs $22,800 Trademarks 13,700 Discount on bonds payable 35,800 Deposits with...
-
POLITICAL DONATION TAX CREDIT (not indexed) = 75% first $400, 50% next $350 and 1/3 next $525... ($650 max credit overall) EDUCATION-RELATED CREDITS (not indexed) (a) TUITION CREDIT = 15% x eligible...
-
A natural monopoly packages Alaskan moss, a unique health product that has no substitutes. The graph illustrates the demand curve for this health product. Price and cost (cents per bag) 60- 50- 40-...
-
Need to prepare goods and services tax/ Harmonized sales tax ( GST/ HST) Return working copy Account Number 1050 1100 1300 1500 2000 2300 2310 3490 4000 4100 5000 6000 6010 6050 6100 6200 6500 6600...
-
During January, Marigold Company requisitions raw materials for production as follows: Job 1 $950, Job 2 $1,460, Job 3 $710, and general factory use $610. During January, time tickets show that the...
-
Satyam's computer was an IT service and its cost needed to be accurately calculated which include salaries and related expenses of technical associates, communication costs, etc. Revenue and the...
-
What is the output of this code? class A { protected int i; private int j; } class B extends A{ public B(){ } super.j = super.i + 1; } private void someMethod () { System.out.println(super.i+""+...
-
Using the theoretical sampling strategy, how many samples of size 4 (n = 4) can be drawn from a population of size: (a) N = 5? (b) N = 8? (c) N = 16? (d) N = 50?
-
Why is the statement of cash flows a useful document?
-
The Lazy 0 Ranch just purchased equipment costing $60,000. The equipment is expected to last five years and have no salvage value . (a) Calculate the depreciation expense using the straight-line...
-
Explain the importance of understanding inventory valuation methods in determining the quality of the profit numbers.
-
Derive the equation of motion for the system in Figure 5.27 for generalized coordinate \(x\) using (a) Lagrange's equation, and (b) Hamilton's principle. k mmm M. r. IG x m Figure 5.27:...
-
Consider again the system of Figure 2.52, reproduced in Figure 5.29. A disk of mass \(m\) and mass moment of inertia \(I_{G}\) is supported by a massless spring and a rope. Derive the equation of...
-
Derive the equations of motion for the system in Figure 5.28 for generalized coordinates \(\theta_{1}\) and \(\theta_{2}\) using (a) Lagrange's equation and (b) Hamilton's principle. m. L. IG eeeee...
Study smarter with the SolutionInn App