Question

In: Accounting

The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...

The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 6,500 Accounts receivable, net 35,000 Merchandise inventory 70,000 Prepaid expenses 3,500 Total current assets 115,000 Property and equipment, net 185,000 Total assets $ 300,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 50,000 Bonds payable, 10% 80,000 Total liabilities 130,000 Stockholders’ equity: Common stock, $5 par value 30,000 Retained earnings 140,000 Total stockholders’ equity 170,000 Total liabilities and stockholders’ equity $ 300,000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales $ 420,000 Cost of goods sold 292,500 Gross margin 127,500 Selling and administrative expenses 89,500 Net operating income 38,000 Interest expense 8,000 Net income before taxes 30,000 Income taxes (30%) 9,000 Net income $ 21,000 Account balances at the beginning of the year were: accounts receivable, $25,000; and inventory, $60,000. All sales were on account. Assets at the beginning of the year totaled $280,000, and the stockholders’ equity totaled $161,600. Required: Compute the following: 1. Gross margin percentage. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) 2. Net profit margin percentage. (Round your answer to the nearest whole percentage place (i.e., 0.1234 should be entered as 12%).) 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 4. Return on equity. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 5. Was financial leverage positive or negative for the year?

Solutions

Expert Solution


Related Solutions

The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31   Assets   Current assets:      Cash $ 19,000      Accounts receivable, net 230,000      Merchandise inventory 350,000      Prepaid expenses 11,000   Total current assets 610,000   Property and equipment, net 820,000   Total assets $ 1,430,000   Liabilities and Stockholders' Equity   Liabilities:      Current liabilities $ 260,000      Bonds payable, 11% 380,000   Total liabilities 640,000   Stockholders’ equity:      Common stock, $5 par value $ 200,000      Retained earnings 590,000   Total stockholders’ equity 790,000   Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 21,000 Accounts receivable, net 210,000 Merchandise inventory 350,000 Prepaid expenses 9,000 Total current assets 590,000 Property and equipment, net 860,000 Total assets $ 1,450,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 200,000 Bonds payable, 10% 310,000 Total liabilities 510,000 Stockholders’ equity: Common stock, $10 per value $ 120,000 Retained earnings 820,000 Total stockholders’ equity 940,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31   Assets   Current assets:      Cash $ 19,000      Accounts receivable, net 200,000      Merchandise inventory 330,000      Prepaid expenses 8,000   Total current assets 557,000   Property and equipment, net 880,000   Total assets $ 1,437,000   Liabilities and Stockholders' Equity   Liabilities:      Current liabilities $ 290,000      Bonds payable, 12% 360,000   Total liabilities 650,000   Stockholders’ equity:      Common stock, $5 par value $ 120,000      Retained earnings 667,000   Total stockholders’ equity 787,000   Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 19,000 Accounts receivable, net 190,000 Merchandise inventory 400,000 Prepaid expenses 10,000 Total current assets 619,000 Property and equipment, net 840,000 Total assets $ 1,459,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 260,000 Bonds payable, 12% 360,000 Total liabilities 620,000 Stockholders’ equity: Common stock, $5 per value $ 200,000 Retained earnings 639,000 Total stockholders’ equity 839,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 21,000 Accounts receivable, net 190,000 Merchandise inventory 360,000 Prepaid expenses 7,000 Total current assets 578,000 Property and equipment, net 890,000 Total assets $ 1,468,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 230,000 Bonds payable, 8% 400,000 Total liabilities 630,000 Stockholders’ equity: Common stock, $5 per value $ 160,000 Retained earnings 678,000 Total stockholders’ equity 838,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 20,000 Accounts receivable, net 230,000 Merchandise inventory 340,000 Prepaid expenses 7,000 Total current assets 597,000 Property and equipment, net 820,000 Total assets $ 1,417,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 240,000 Bonds payable, 10% 380,000 Total liabilities 620,000 Stockholders’ equity: Common stock, $5 per value $ 200,000 Retained earnings 597,000 Total stockholders’ equity 797,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 22,000 Accounts receivable, net 220,000 Merchandise inventory 350,000 Prepaid expenses 9,000 Total current assets 601,000 Property and equipment, net 830,000 Total assets $ 1,431,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 240,000 Bonds payable, 9% 330,000 Total liabilities 570,000 Stockholders’ equity: Common stock, $5 par value $ 100,000 Retained earnings 761,000 Total stockholders’ equity 861,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 22,000 Accounts receivable, net 220,000 Merchandise inventory 300,000 Prepaid expenses 9,000 Total current assets 551,000 Property and equipment, net 870,000 Total assets $ 1,421,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 290,000 Bonds payable, 8% 380,000 Total liabilities 670,000 Stockholders’ equity: Common stock, $5 par value $ 140,000 Retained earnings 611,000 Total stockholders’ equity 751,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 23,000 Accounts receivable, net 200,000 Merchandise inventory 370,000 Prepaid expenses 7,000 Total current assets 600,000 Property and equipment, net 840,000 Total assets $ 1,440,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 240,000 Bonds payable, 8% 380,000 Total liabilities 620,000 Stockholders’ equity: Common stock, $5 par value $ 160,000 Retained earnings 660,000 Total stockholders’ equity 820,000 Total liabilities...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December...
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash $ 18,000 Accounts receivable, net 250,000 Merchandise inventory 330,000 Prepaid expenses 8,000 Total current assets 606,000 Property and equipment, net 880,000 Total assets $ 1,486,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 260,000 Bonds payable, 8% 340,000 Total liabilities 600,000 Stockholders’ equity: Common stock, $5 per value $ 140,000 Retained earnings 746,000 Total stockholders’ equity 886,000 Total liabilities...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT