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In: Accounting
Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed Assets to Long-Term Liabilities Recent balance...
Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed Assets to Long-Term Liabilities
Recent balance sheet information for two companies in the food industry, Santa Fe Company and Madrid Company, is as follows (in thousands):
| Santa Fe | Madrid | |||
| Net property, plant, and equipment | $743,280 | $574,700 | ||
| Current liabilities | 331,320 | 466,878 | ||
| Long-term debt | 687,534 | 413,784 | ||
| Other long-term liabilities | 241,566 | 160,916 | ||
| Stockholders' equity | 300,100 | 226,430 | ||
a. Determine the ratio of liabilities to stockholders' equity for both companies. Round to one decimal place.
| Santa Fe | |
| Madrid |
b. Determine the ratio of fixed assets to long-term liabilities for both companies. Round to one decimal place.
| Santa Fe | |
| Madrid |
c. Although uses more debt, it has creditor protection and borrowing capacity.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed Assets to Long-Term Liabilities Recent balance...
Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed
Assets to Long-Term Liabilities
Recent balance sheet information for two companies in the food
industry, Santa Fe Company and Madrid Company, is as follows (in
thousands):
Santa Fe
Madrid
Net property, plant, and equipment
$634,720
$816,800
Current liabilities
257,307
599,208
Long-term debt
587,116
588,096
Other long-term liabilities
206,284
228,704
Stockholders' equity
256,270
321,820
a. Determine the ratio of liabilities to
stockholders' equity for both companies. Round to one decimal
place....
Determine the company’s (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to stockholders’ equity. Round to one decimal place.
The following information was taken from Sigmund Company’s balance sheet:Fixed assets (net) $1,050,000Long-term liabilities 750,000Total liabilities 850,000Total stockholders’ equity 500,000Determine the company’s (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to stockholders’ equity. Round to one decimal place.
Determine the company’s (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to total stockholders’ equity. Round to one decimal place.
The following information was taken from Acme Company’s balance sheet:Fixed assets (net) $1,400,000Long-term liabilities 400,000Total liabilities 560,000Total stockholders’ equity 1,400,000Determine the company’s (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to total stockholders’ equity. Round to one decimal place.
Comparative Balance Sheet of “Alpha- Beta” Assets 2018 2017 Liabilities & Stockholders’ Equity 2018 2017 Fixed...
Comparative Balance Sheet of “Alpha- Beta”
Assets
2018
2017
Liabilities &
Stockholders’ Equity
2018
2017
Fixed Assets
Property, Plant and
Equipment
Accumulated
depreciation
Net Property, Plant and
Equipment
Other Assets
Total Fixed Assets
Current Assets
Cash and Cash
Equivalents
Accounts receivables
Inventory
Prepaid Expenses
Total Current Assets
Total Assets
3,250,000
(425,000)
2,825,000
725,000
3,550,000
300,000
900,000
1,100,000
100,000
2,400,000
5,950,000
2,100,000
(250,000)
1,850,000
550,000
2,400,000
300,000
750,000
800,000
100,000
1,950,000
4,350,000
Shareholders’ Equity
Common Stock
Retained earnings
Total Stockholders’
Equity...
Determine the following 2021 balance sheet items: 1. Current assets 2. Shareholders’ equity 3. Long-term assets 4. Long-term liabilities
The current asset section of the Excalibur Tire Company’s balance sheet consists of cash, marketable securities, accounts receivable, and inventory. On December 31, 2021, the balance sheet revealed the following:
Inventory ................................$ 840,000
Total assets .........................$ 2,800,000
Current ratio ...................................2.25
Acid-test ratio ...................................1.2
Debt to equity ratio .........................1.8
Required:
Determine the following 2021 balance sheet items:
1. Current assets
2. Shareholders’ equity
3. Long-term assets
4. Long-term liabilities
Ruskin has the following balance sheet: Current assets $30,000,000, Current liabilities $10,000,000, Fixed assets 60,000,000, Long-term...
Ruskin has the following balance sheet:
Current assets $30,000,000, Current liabilities $10,000,000,
Fixed assets 60,000,000, Long-term debt 25,000,000, Common stock (1
million shares) 1,000,000, Retained earnings 39,000,000, Preferred
Stock 15,000,000, Total assets $90,000,000, Total claims
$90,000,000.
The current liabilities consist entirely of notes payable to
banks, and the interest rate on this debt is 10%, the same as the
rate on new bank loans. These bank loans are not used for seasonal
financing but instead are part of the company’s...
Ratio Analysis: Balance Sheet (Millions of $) Assets Liabilities and Equity Cash and securities $ 1,554.0...
Ratio Analysis:
Balance Sheet (Millions of $)
Assets
Liabilities and Equity
Cash and securities
$ 1,554.0
Accounts payable
$ 7,980.0
Accounts receivable
9660.00
Notes payable
5880.00
Inventories
13,440.0
Accruals
4,620.0
Total current assets
24654.00
Total current liabilities
18480.00
Net plant and equipment
17,346.0
Long-term bonds
10,920.0
Total assets
42000.00
Total debt
29400.00
Common stock
3360.00
Retained earnings
9,240.0
Total common equity
12600.00
Total liabilities and equity
42000.00
Income Statement (Millions of $)
Other data:
Sales
58800.00
Shares outstanding (millions)
175.00...
The following table presents the long-term liabilities and stockholders’ equity of Information Control Corp. one year...
The following table presents the long-term liabilities and
stockholders’ equity of Information Control Corp. one year
ago:
Long-term debt
$
65,900,000
Preferred stock
4,090,000
Common stock ($1 par value)
15,900,000
Capital surplus
45,900,000
Accumulated retained
earnings
135,900,000
During the past year, the company issued 10.9 million shares of new
stock at a total price of $59.8 million, and issued $35.9 million
in new long-term debt. The company generated $10.8 million in net
income and paid $2.9 million in dividends....
The following table presents the long-term liabilities and stockholders’ equity of Information Control Corp. one year...
The following table presents the long-term liabilities and
stockholders’ equity of Information Control Corp. one year ago:
Long-term debt $ 66,600,000 Preferred stock 4,160,000 Common stock
($1 par value) 16,600,000 Capital surplus 46,600,000 Accumulated
retained earnings 136,600,000 During the past year, the company
issued 11.6 million shares of new stock at a total price of $61.2
million, and issued $36.6 million in new long-term debt. The
company generated $12.2 million in net income and paid $3.6 million
in dividends. Prepare...
1. Provide a flowchart of the cycle for Auditing the Financing/Investing Process: Long-Term Liabilities, Stockholders' Equity,...
1. Provide a flowchart of the cycle for Auditing the
Financing/Investing Process: Long-Term Liabilities, Stockholders'
Equity, and Income Statement Accounts. Prepare an audit program.
Describe the cycle and include any risks involved with this
cycle.
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