Question

Measures of liquidity, Solvency, and Profitability

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 58 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			$3,362,100		$2,825,200
Net income			717,600		578,700
Total			$4,079,700		$3,403,900
Dividends:
	On preferred stock		$9,800		$9,800
	On common stock		32,000		32,000
		Total dividends	$41,800		$41,800
Retained earnings, December 31			$4,037,900		$3,362,100

Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
	20Y2		20Y1
Sales	$4,232,540		$3,899,650
Cost of goods sold	1,664,400		1,531,250
Gross profit	$2,568,140		$2,368,400
Selling expenses	$812,490		$1,003,410
Administrative expenses	692,130		589,300
Total operating expenses	$1,504,620		$1,592,710
Income from operations	$1,063,520		$775,690
Other revenue	55,980		49,510
	$1,119,500		$825,200
Other expense (interest)	304,000		167,200
Income before income tax	$815,500		$658,000
Income tax expense	97,900		79,300
Net income	$717,600		$578,700

Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
			20Y2		20Y1
Assets
Current assets
	Cash		$727,650		$686,960
	Marketable securities		1,101,310		1,138,380
	Accounts receivable (net)		839,500		788,400
	Inventories		627,800		481,800
	Prepaid expenses		137,659		137,390
		Total current assets	$3,433,919		$3,232,930
Long-term investments			2,148,091		206,267
Property, plant, and equipment (net)			4,940,000		4,446,000
Total assets			$10,522,010		$7,885,197
Liabilities
Current liabilities			$1,184,110		$933,097
Long-term liabilities:
	Mortgage note payable, 8%		$1,710,000		$0
	Bonds payable, 8%		2,090,000		2,090,000
		Total long-term liabilities	$3,800,000		$2,090,000
Total liabilities			$4,984,110		$3,023,097
Stockholders' Equity
Preferred $0.70 stock, $50 par			$700,000		$700,000
Common stock, $10 par			800,000		800,000
Retained earnings			4,037,900		3,362,100
Total stockholders' equity			$5,537,900		$4,862,100
Total liabilities and stockholders' equity			$10,522,010		$7,885,197

Required:

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		%

I have the answers for 1-5, I just need help with 6-18.

Answer 1

1) Working capital= Current assets-Current liabilities

= $1156864-361520= $795344

2) Current ratio= Current assets/Current liabilities

= $1156864/361520= 3.2

3) Quick assets= $265980+402560+248200= $916740

Quick ratio= Quick assets/Current liabilities

= $916740/361520= 2.5

4) Average account receivable= $(248200+233600)/2= $240900

Accounts receivable turnover= Net sales/Average account receivable

= $1421310/240900= 5.9

5) Number of days' sales in receivables= 365/Accounts receivable turnover

= 365/5.9= 61.9 days

6) Average inventory= $(189800+146000)/2= $167900

Inventory turnover ratio= Cost of goods sold/Average inventory

= $486910/167900= 2.9

7) Number of days' sales in inventory= 365/Inventory turnover ratio

= 365/2.9= 125.9 days

8) Ratio of fixed assets to long term liabilities= Total fixed assets/Long term liabilities

= $1100000/1000000= 1.1

9) Ratio of liabilities to shareholders' equity= Total liabilities/Shareholders' equity

= $1361520/1701900= 0.8

10) Time interest earned= (Income before income tax+Interest expense)/Interest expense

= $(254500+80000)/80000= 4.2

11) Average total assets= $(3063420+2365151)/2= $2714285.5

Asset turnover= Net sales/Average total assets

= $1421310/2714285.5= 0.5

12) Return on total assets= Net income*100/Average total assets

= $224000*100/2714285.5= 8.3%

13) Average stockholders' equity= $(1701900+1498100)/2= $1600000

Return on stockholders' equity= Net income*100/Average stockholders' equity

= $224000*100/1600000= 14%

14) Average common stockholders' equity= $(250000+1231900+250000+1028100)/2= $1380000

Return on common stockholders' equity= (Net income-Preferred dividend)*100/Average common stockholders' equity

= $(224000-7700)*100/1380000= 15.7%

15) Earning per share on common stock= (Net income-Preferred dividend)/Weighted average shares outstanding

= $(224000-7700)*100/25000= $8.7

16) Price-earning ratio= Market price per share/Earning price per share

= $54/8.7= 6.2

17) Dividend per share of common stock= Dividend on common stock/Common shares outstanding

= $12500/25000= $0.5

18) Dividend yield ratio= Dividend per share*100/Market price per share

= $0.5*100/54= 0.9%