Question

The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall Inc. common stock was $ 61 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			$ 1,314,800		$ 1,112,500
Net income			276,000		227,900
Total			$ 1,590,800		$ 1,340,400
Dividends
	On preferred stock		$ 9,100		$ 9,100
	On common stock		16,500		16,500
		Total dividends	$ 25,600		$ 25,600
Retained earnings, December 31			$ 1,565,200		$ 1,314,800

Marshall Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
	20Y2		20Y1
Sales	$ 1,737,400		$ 1,600,750
Cost of goods sold	635,100		584,290
Gross profit	$ 1,102,300		$ 1,016,460
Selling expenses	$ 372,810		$ 447,670
Administrative expenses	317,570		262,910
Total operating expenses	690,380		710,580
Income from operations	$ 411,920		$ 305,880
Other income	21,680		19,520
	$ 433,600		$ 325,400
Other expense (interest)	120,000		66,400
Income before income tax	$ 313,600		$ 259,000
Income tax expense	37,600		31,100
Net income	$ 276,000		$ 227,900

Marshall Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
			Dec. 31, 20Y2		Dec. 31, 20Y1
Assets
Current assets
	Cash		$ 232,130		$ 282,580
	Marketable securities		351,330		468,270
	Accounts receivable (net)		321,200		299,300
	Inventories		248,200		189,800
	Prepaid expenses		43,912		56,520
		Total current assets	$ 1,196,772		$ 1,296,470
Long-term investments			1,191,108		380,650
Property, plant, and equipment (net)			1,650,000		1,485,000
Total assets			$ 4,037,880		$ 3,162,120
Liabilities
Current liabilities			$ 412,680		$ 457,320
Long-term liabilities
	Mortgage note payable, 8 %		$ 670,000		$ 0
	Bonds payable, 8 %		830,000		830,000
		Total long-term liabilities	$ 1,500,000		$ 830,000
Total liabilities			$ 1,912,680		$ 1,287,320
Stockholders' Equity
Preferred $ 0.70 stock, $ 20 par			$ 260,000		$ 260,000
Common stock, $ 10 par			300,000		300,000
Retained earnings			1,565,200		1,314,800
	Total stockholders' equity		$ 2,125,200		$ 1,874,800
Total liabilities and stockholders' equity			$ 4,037,880		$ 3,162,120

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		%

Answer 1

1. Ratio Analysis -