Question

Hyrkas Corporation's most recent balance sheet and income statement appear below:

Balance Sheet
December 31, Year 2 and Year 1
(in thousands of dollars)
	Year 2			Year 1
Assets
Current assets:
Cash	$	220		$	330
Accounts receivable, net		360			380
Inventory		330			300
Prepaid expenses		20			20
Total current assets		930			1,030
Plant and equipment, net		1,180			1,300
Total assets	$	2,110		$	2,330
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	300		$	330
Accrued liabilities		50			50
Notes payable, short term		40			40
Total current liabilities		390			420
Bonds payable		290			500
Total liabilities		680			920
Stockholders’ equity:
Common stock, $2 par value		200			200
Additional paid-in capital		330			330
Retained earnings		900			880
Total stockholders’ equity		1,430			1,410
Total liabilities & stockholders’ equity	$	2,110		$	2,330

Income Statement
For the Year Ended December 31, Year 2
(in thousands of dollars)
Sales (all on account)	$	1,560
Cost of goods sold		990
Gross margin		570
Selling and administrative expense		475
Net operating income		95
Interest expense		20
Net income before taxes		75
Income taxes (30%)		23
Net income	$	52

Dividends on common stock during Year 2 totaled $32 thousand. The market price of common stock at the end of Year 2 was $14.00 per share.

Required:

Compute the following for Year 2:

Need these calculations please?

a. Gross margin percentage. (Round your answer to 1 decimal place.)

b. Earnings per share. (Round your answer to 2 decimal places.)

c. Price-earnings ratio. (Do not round intermediate calculations. Round your answer to 1 decimal place.)

d. Dividend payout ratio. (Do not round intermediate calculations. Round your "Percentage" answer to 1 decimal place.)

e. Dividend yield ratio. (Round your "Percentage" answer to 2 decimal places.)

f. Return on total assets. (Do not round intermediate calculations. Round your "Percentage" answer to 2 decimal places.)

g. Return on equity. (Round your "Percentage" answer to 2 decimal places.)

h. Book value per share. (Round your answer to 2 decimal places.)

i. Working capital. (Input your answer in thousands of dollars.)

j. Current ratio. (Round your answer to 2 decimal places.)

k. Acid-test (quick) ratio. (Round your answer to 2 decimal places.)

l. Accounts receivable turnover. (Round your answer to 2 decimal places.)

m. Average collection period. (Use 365 days in a year. Do not round intermediate calculations. Round your answer to 1 decimal place.)

n. Inventory turnover. (Round your answer to 2 decimal places.)

o. Average sale period. (Use 365 days in a year. Do not round intermediate calculations. Round your answer to 1 decimal place.)

p. Times interest earned ratio. (Round your answer to 2 decimal places.)

q. Debt-to-equity ratio. (Round your answer to 2 decimal places.)

Answer 1

a.	Gross margin percentage=Gross margin/Sales=570/1560=0.3654=36.5%
b.	Earnings per share=Net income/Number of common shares
	Number of common shares=Common stock/Par value=200000/2=100000 shares
	Earnings per share=52000/100000=$ 0.52
c.	Price-earnings ratio=Price per share/Earnings per share=14/0.52=26.9
d.	Dividend payout ratio=Dividend per share/Earnings per share
	Dividend per share=Dividend/Number of common shares=32000/100000=0.32
	Dividend payout ratio=0.32/0.52=0.6154=61.5%
e.	Dividend yield ratio=Dividend per share/Price per share=0.32/14=0.0229=2.29%
f.	Return on total assets=Net income/Avergae total assets
	Average total assets=(Beg. Bal of total assets+End. Bal of total assets)/2=(2330+2110)/2=$ 2220
	Return on total assets=52/2220=0.02342=2.34%
g.	Return on equity=Net income/Average stockholde's equity
	Average stockholder's equity=(Beg. Bal of stockholder's equity+End. Bal of stockholder's equity)/2=(1410+1430)/2=$ 1420
	Return on equity=52/1420=0.03662=3.66%
h.	Book value per share=Total stockholder's equity/Number of common shares=1430000/100000=14.30
i.	Working capital=Current assets-Current liabilities=930-390=$ 540
j.	Current ratio=Current assets/Current liabilties=930/390=2.38
k.	Acid-test ratio=(Current assets-Inventory-Prepaid expenses)/Current liabilities=(930-330-20)/390=1.49
l.	Accounts receivable turnover=Net credit sales/Average accounts receivable
	Net credit sales=Sales=$ 1560		(Since all sales are on account)
	Average accounts receivable=(Beginning accounts receivable+Ending accounts receivable)/2=(380+360)/2=$ 370
	Accounts receivable turnover=1560/370=4.22
m.	Average collection period=365/Accounts receivable turnover=365/4.22=86.5 days
n.	Inventory turnover=Cost of goods sold/Average inventory
	Average inventory=(Beginning inventory+Ending inventory)/2=(300+330)/2=$ 315
	Inventory turnover=990/315=3.14
o.	Average sale period=365/Inventory turnover=365/3.14=116.2 days
p.	Times interest earned ratio=Earnings before interest and taxes (EBIT)/Interest expense
	Here, EBIT=Net operating income=$ 95
	Times interest earned ratio=95/20=4.75
q.	Debt to equity ratio=Debt/Stockholder's equity
	Here, Debt=Bonds payable=$ 290
	Debt to equity ratio=290/1430=0.20