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KORBIN COMPANY Comparative Income Statements For Years Ended December 31, 2015, 2014, and 2013 2015 2014...

KORBIN COMPANY
Comparative Income Statements
For Years Ended December 31, 2015, 2014, and 2013
2015 2014 2013
  Sales $ 450,688 $ 345,264 $ 239,600
  Cost of goods sold 271,314 216,826 153,344
  Gross profit 179,374 128,438 86,256
  Selling expenses 63,998 47,646 31,627
  Administrative expenses 40,562 30,383 19,887
  Total expenses 104,560 78,029 51,514
  Income before taxes 74,814 50,409 34,742
  Income taxes 13,915 10,334 7,053
  Net income $ 60,899 $ 40,075 $ 27,689
KORBIN COMPANY
Comparative Balance Sheets
December 31, 2015, 2014, and 2013
2015 2014 2013
  Assets
  Current assets $ 48,375 $ 37,847 $ 50,593
  Long-term investments 0 900 3,080
  Plant assets, net 88,471 94,135 56,420
  Total assets $ 136,846 $ 132,882 $ 110,093
  Liabilities and Equity
  Current liabilities $ 19,980 $ 19,799 $ 19,266
  Common stock 72,000 72,000 54,000
  Other paid-in capital 9,000 9,000 6,000
  Retained earnings 35,866 32,083 30,827
  Total liabilities and equity $ 136,846 $ 132,882 $ 110,093
Required:
a. Complete the below table to calculate each year's current ratio.
b.

Complete the below table to calculate income statement data in common-size percents. (Round your percentage answers to 2 decimal places.)

c.

Complete the below table to calculate the balance sheet data in trend percents with 2013 as the base year. (Round your percentage answers to 2 decimal places.)

Solutions

Expert Solution

  • All working forms part of the answer
  • Requirement ‘a’

Current Assets

/

Current Liabilities

=

Current Ratio

2013

$                                         50,593.00

/

$            19,266.00

=

2.63

2014

$                                         37,847.00

/

$            19,799.00

=

1.91

2015

$                                         48,375.00

/

$            19,980.00

=

2.42

  • Requirement ‘b’

KORBIN COMPANY

Comparative Income Statements

For Years Ended December 31, 2015, 2014, and 2013

2015

2014

2013

  Sales

$                                     4,50,688.00

100.00%

$        3,45,264.00

100.00%

$       2,39,600.00

100.00%

  Cost of goods sold

$                                     2,71,314.00

60.20%

$        2,16,826.00

62.80%

$       1,53,344.00

64.00%

  Gross profit

$                                     1,79,374.00

39.80%

$        1,28,438.00

37.20%

$          86,256.00

36.00%

  Selling expenses

$                                         63,998.00

14.20%

$            47,646.00

13.80%

$          31,627.00

13.20%

  Administrative expenses

$                                         40,562.00

9.00%

$            30,383.00

8.80%

$          19,887.00

8.30%

  Total expenses

$                                     1,04,560.00

23.20%

$            78,029.00

22.60%

$          51,514.00

21.50%

  Income before taxes

$                                         74,814.00

16.60%

$            50,409.00

14.60%

$          34,742.00

14.50%

  Income taxes

$                                         13,915.00

3.09%

$            10,334.00

2.99%

$             7,053.00

2.94%

  Net income

$                                         60,899.00

13.51%

$            40,075.00

11.61%

$          27,689.00

11.56%

  • Requirement ‘c’

KORBIN COMPANY

Comparative Balance Sheets

December 31, 2015, 2014, and 2013

2015

2014

2013

Amount

Increase (Decrease) over 2013

Increase (Decrease) in % over 2013

Amount

Increase (Decrease) over 2013

Increase (Decrease) in % over 2013

  Assets

  Current assets

$                                         48,375.00

$                     (2,218.00)

-4.38%

$                 37,847.00

$        (12,746.00)

-25.19%

$          50,593.00

  Long-term investments

$                                                        -  

$                     (3,080.00)

-6.09%

$                       900.00

$          (2,180.00)

-4.31%

$             3,080.00

  Plant assets, net

$                                         88,471.00

$                     32,051.00

63.35%

$                 94,135.00

$          37,715.00

74.55%

$          56,420.00

  Total assets

$                                     1,36,846.00

$                     26,753.00

52.88%

$             1,32,882.00

$          22,789.00

45.04%

$       1,10,093.00

  Liabilities and Equity

  Current liabilities

$                                         19,980.00

$                           714.00

1.41%

$                 19,799.00

$                533.00

1.05%

$          19,266.00

  Common stock

$                                         72,000.00

$                     18,000.00

35.58%

$                 72,000.00

$          18,000.00

35.58%

$          54,000.00

  Other paid-in capital

$                                           9,000.00

$                       3,000.00

5.93%

$                   9,000.00

$             3,000.00

5.93%

$             6,000.00

  Retained earnings

$                                         35,866.00

$                       5,039.00

9.96%

$                 32,083.00

$             1,256.00

2.48%

$          30,827.00

  Total liabilities and equity

$                                     1,36,846.00

$                     26,753.00

52.88%

$             1,32,882.00

$          22,789.00

45.04%

$       1,10,093.00


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