Question

Measures of liquidity,  Solvency and  Profitability

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall Inc. common stock was $ 64 on December 31, 20Y2.

Marshall Inc.
Comparative Retained Earnings Statement
For the Years Ended December 31, 20Y2 and 20Y1
			20Y2		20Y1
Retained earnings, January 1			$ 1,265,700		$ 1,079,900
Net income			304,000		221,200
Total			$ 1,498,900		$ 1,301,100
Dividends
	On preferred stock		$ 9,800		$ 9,800
	On common stock		25,600		25,600
		Total dividends	$ 35,400		$ 35,400
Retained earnings, December 31			$ 1,534,300		$ 1,265,700

Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
	20Y2		20Y1
Sales	$ 1,714,770		$ 1,579,930
Cost of goods sold	633,640		582,950
Gross profit	$ 1,081,130		$ 996,980
Selling expenses	$ 353,220		$ 445,350
Administrative expenses	300,890		261,550
Total operating expenses	654,110		706,900
Income from operations	$ 427,020		$ 290,080
Other income	22,480		18,520
	$ 449,500		$ 308,600
Other expense (interest)	104,000		57,600
Income before income tax	$ 345,500		$ 251,000
Income tax expense	41,500		29,800
Net income	$ 304,000		$ 221,200

Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
			Dec. 31, 20Y2		Dec. 31, 20Y1
Assets
Current assets
	Cash		$ 312,690		$ 342,660
	Marketable securities		473,250		567,850
	Accounts receivable (net)		306,600		284,700
	Inventories		233,600		175,200
	Prepaid expenses		59,156		68,530
		Total current assets	$ 1,385,296		$ 1,438,940
Long-term investments			766,444		549,671
Property, plant, and equipment (net)			1,690,000		1,521,000
Total assets			$ 3,841,740		$ 3,509,611
Liabilities
Current liabilities			$ 407,440		$ 923,911
Long-term liabilities
	Mortgage note payable, 8 %		$ 580,000		$ 0
	Bonds payable, 8 %		720,000		720,000
		Total long-term liabilities	$ 1,300,000		$ 720,000
Total liabilities			$ 1,707,440		$ 1,643,911
Stockholders' Equity
Preferred $ 0.70 stock, $ 20 par			$ 280,000		$ 280,000
Common stock, $ 10 par			320,000		320,000
Retained earnings			1,534,300		1,265,700
	Total stockholders' equity		$ 2,134,300		$ 1,865,700
Total liabilities and stockholders' equity			$ 3,841,740		$ 3,509,611

Determine the following measures for 20Y2, rounding to one decimal place, except for dollar amounts, which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.

1. Working capital	$
2. Current ratio
3. Quick ratio
4. Accounts receivable turnover
5. Number of days' sales in receivables		days
6. Inventory turnover
7. Number of days' sales in inventory		days
8. Ratio of fixed assets to long-term liabilities
9. Ratio of liabilities to stockholders' equity
10. Times interest earned
11. Asset turnover
12. Return on total assets		%
13. Return on stockholders’ equity		%
14. Return on common stockholders’ equity		%
15. Earnings per share on common stock	$
16. Price-earnings ratio
17. Dividends per share of common stock	$
18. Dividend yield		%

Answer 1