Question

The next 6 questions are based on the following information for Wagner Company for the years 2012, 2011, and 2010:

2012 2011 2010

Total revenues $910,000 $620,000 $540,000

Total expenses $780,000 $530,000 $450,000

Total assets $600,000 $300,000 $270,000

Total liabilities $320,000 $180,000 $140,000

Total owners’ equity $ ? $ ? $ ?

1. The percent increase in total revenues from 2010 to 2012 is (round to nearest whole percent)

A. 85%

B. 14%

C. 69%

D. 44%

E. None of the above.

2. The net profit margin percent for 2012 is (round to nearest whole percent)

A. 47%

B. 33%

C. 50%

D. 14%

E. None of the above.

3. The percent of liabilities to total liabilities and owner's equity at the end of 2012 is (round to nearest whole percent)

A. 47%

B. 53%

C. 56%

D. 31%

E. None of the above.

4. Total asset turnover based on average assets for 2012 is (round to one decimal place)

A. 2.5 times.

B. 1.5 times.

C. 2.0 times

D. 1.7 times.

E. None of the above.

5. The year the company had the highest percent of net income to total revenues was:

A. 2010

B. 2011

C. 2012

6. The year the company had the lowest risk in terms of a liability percent was:

A. 2010

B. 2011

C. 2012

Answer 1

Q1.
C. 69%
Increase in rvenue (910000-540000):				370000
Revenue of 2010				540000
% increase				68.52%
Q2.
D. 14%
Net income (910000-780000)				130000
Divide: Revenue				910000
Net Margin percent				14.28%
Q3.
B. 53%
Liabilities of 2012				320000
Total liab and equity (i.e. total assets)				600000
% of liabilities to total liab and equity				53.33%
Q4.
C . 2.0 times
Revenue for 2012				910000
Average total assets (600000+300000)/2				450000
Assets turnover ratio				2.02
Q5.
A. 2010
		2012	2011	2010
Net income		130000	90000	90000
Sales		910000	620000	540000
Net income percent		14.29%	14.52%	16.67%
Q6.
A. 2010
		2012	2011	2010
Liabilities		320000	180000	140000
Divide: Total assets		600000	300000	270000
Liabilities % to total assets		53.33%	60.00%	51.85%