The following financial statements apply to Thornton Company:
| Year 4 | Year 3 | ||||||
| Revenues | |||||||
| Net sales | $ | 210,100 | $ | 175,600 | |||
| Other revenues | 8,600 | 6,600 | |||||
| Total revenues | 218,700 | 182,200 | |||||
| Expenses | |||||||
| Cost of goods sold | 125,900 | 102,500 | |||||
| Selling expenses | 19,900 | 17,900 | |||||
| General and administrative expenses | 10,100 | 9,100 | |||||
| Interest expense | 1,500 | 1,500 | |||||
| Income tax expense | 19,300 | 17,300 | |||||
| Total expenses | 176,700 | 148,300 | |||||
| Net income | $ | 42,000 | $ | 33,900 | |||
| Assets | |||||||
| Current assets | |||||||
| Cash | $ | 5,400 | $ | 6,400 | |||
| Marketable securities | 1,200 | 1,200 | |||||
| Accounts receivable | 36,300 | 31,500 | |||||
| Inventories | 101,800 | 95,000 | |||||
| Prepaid expenses | 3,700 | 2,700 | |||||
| Total current assets | 148,400 | 136,800 | |||||
| Plant and equipment (net) | 106,500 | 106,500 | |||||
| Intangibles | 21,100 | 0 | |||||
| Total assets | $ | 276,000 | $ | 243,300 | |||
| Liabilities and Stockholders’ Equity | |||||||
| Liabilities | |||||||
| Current liabilities | |||||||
| Accounts payable | $ | 38,500 | $ | 55,500 | |||
| Other | 15,800 | 16,600 | |||||
| Total current liabilities | 54,300 | 72,100 | |||||
| Bonds payable | 65,600 | 66,600 | |||||
| Total liabilities | 119,900 | 138,700 | |||||
| Stockholders’ equity | |||||||
| Common stock (43,000 shares) | 113,000 | 113,000 | |||||
| Retained earnings | 43,100 | (8,400 | ) | ||||
| Total stockholders’ equity | 156,100 | 104,600 | |||||
| Total liabilities and stockholders’ equity | $ | 276,000 | $ | 243,300 | |||
Required
Calculate the following ratios for Year 3 and Year 4. Since Year 2
numbers are not presented do not use averages when calculating the
ratios for Year 3. Instead, use the number presented on the Year 3
balance sheet.
a. Net margin. (Round your answers to 2
decimal places.)
b. Return on investment. (Round your
answers to 2 decimal places.)
c. Return on equity. (Round your answers
to 2 decimal places.)
d. Earnings per share. (Round your answers
to 2 decimal places.)
e. Price-earnings ratio (market prices at the end
of Year 3 and Year 4 were $5.95 and $4.94, respectively).
(Round your intermediate calculations and final answers to
2 decimal places.)
f. Book value per share of common stock.
(Round your answers to 2 decimal places.)
g. Times interest earned. Exclude extraordinary
income in the calculation as they cannot be expected to recur and,
therefore, will not be available to satisfy future interest
payments. (Round your answers to 2 decimal
places.)
h. Working capital.
i. Current ratio. (Round your answers to 2
decimal places.)
j. Quick (acid-test) ratio. (Round your
answers to 2 decimal places.)
k. Accounts receivable turnover. (Round
your answers to 2 decimal places.)
l. Inventory turnover. (Round your answers
to 2 decimal places.)
m. Debt-to-equity ratio. (Round your
answers to 2 decimal places.)
n. Debt-to-assets ratio. (Round your
answers to the nearest whole percent.)
In: Accounting
A 43-year-old woman presented to her family physician with a two-year history of fatigue, diarrhea, and constant dull abdominal discomfort. Stools were described as normal in frequency and intermittently loose in consistency. The patient, a marine biologist with an extensive travel history, noticed that her symptoms began after a busy year of fieldwork in Iceland, Denmark, and the Arctic, during which she began regularly consuming raw sushi and sashimi. Serum vitamin B12 was 157 pmol/ L, compared to a level of 435 pmol/ L two years ago.
Questions:
12.Which organism can cause this type of disease onset? Describe how a person may be infected by this organism?
13.Explain how the decrease of Vitamin B12 is related histologically.
14.How is the vitamin B12 deficiency and macrocytosis related?
A 62-year-old alcoholic presents to the emergency room with 8 hours of severe abdominal pain and vomiting. Physical examination discloses exquisite abdominal tenderness. Serum levels of amylase and lipase are elevated.
QUESTIONS:
These laboratory data indicate that this patient has suffered injury to which of the following internal organs?
.What would be the likely diagnosis of the patient?
The organ being describe function as both an exocrine and endocrine gland. The endocrine function is located in clusters found within the organ and is called as what?
In: Anatomy and Physiology
Jorgensen High Tech Inc. is a calendar-year, accrual-method taxpayer. At the end of year 1, Jorgensen accrued and deducted the following bonuses for certain employees for financial accounting purposes.
$60,400 for Ken.
$45,300 for Jayne.
$30,200 for Jill.
$15,100 for Justin.
How much of the accrued bonuses can Jorgensen deduct in year 1 under the following alternative scenarios?
b. Jorgensen paid the bonuses to the employees on April 1 of year 2.
c. Jorgensen paid the bonuses to employees on
March 1 of year 2, and there is a requirement that the employee
must remain employed with Jorgensen on the payment date to receive
the bonus.
d. Jorgensen paid the bonuses to employees on
March 1 of year 2, and there is a requirement that the employee
must remain employed with Jorgensen on the payment date to receive
the bonus; if not, the forfeited bonus is reallocated to the other
employees.
In: Accounting
Comparative financial statement data for Carmono Company follow:
| This Year | Last Year | ||||
| Assets | |||||
| Cash | $ | 5.00 | $ | 9.00 | |
| Accounts receivable | 40.00 | 33.00 | |||
| Inventory | 80.00 | 66.20 | |||
| Total current assets | 125.00 | 108.20 | |||
| Property, plant, and equipment | 216.00 | 184.00 | |||
| Less accumulated depreciation | 41.60 | 31.20 | |||
| Net property, plant, and equipment | 174.40 | 152.80 | |||
| Total assets | $ | 299.40 | $ | 261.00 | |
| Liabilities and Stockholders’ Equity | |||||
| Accounts payable | $ | 48.00 | $ | 41.00 | |
| Common stock | 98.00 | 76.00 | |||
| Retained earnings | 153.40 | 144.00 | |||
| Total liabilities and stockholders’ equity | $ | 299.40 | $ | 261.00 | |
For this year, the company reported net income as follows:
| Sales | $ | 600.00 |
| Cost of goods sold | 360.00 | |
| Gross margin | 240.00 | |
| Selling and administrative expenses | 220.00 | |
| Net income | $ | 20.00 |
This year Carmono declared and paid a cash dividend. There were no sales of property, plant, and equipment during this year. The company did not repurchase any of its own stock this year.
Required:
1. Using the indirect method, prepare a statement of cash flows for this year.
2. Compute Carmono’s free cash flow for this year.
In: Accounting
The following accounts and corresponding balances were drawn from Rooney Company’s Year 2 and Year 1 year-end balance sheets.
| Account Title | Year 2 | Year 1 | ||||
| Accounts receivable | $ | 74,300 | $ | 79,700 | ||
| Prepaid rent | 630 | 1,020 | ||||
| Utilities payable | 1,640 | 850 | ||||
| Other operating expenses payable | 32,100 | 35,600 | ||||
The Year 2 income statement is shown as follows.
| Income Statement | |||
| Sales | $ | 292,000 | |
| Rent expense | (22,900 | ) | |
| Utilities expense | (34,700 | ) | |
| Other operating expenses | (167,400 | ) | |
| Net Income | $ | 67,000 | |
Required
Prepare the operating activities section of the statement of cash flows using the direct method.
Prepare the operating activities section of the statement of cash flows using the indirect method.
Prepare the operating activities section of the statement of cash flows using the direct method. (Cash outflows should be indicated with minus sign.)
|
|||||||||||||||||
Prepare the operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)
|
|||||||||||||||||||||||
In: Accounting
On January 1, the first day of its fiscal year, Chin Company issued $10,000,000 of five-year, 7% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 8%, resulting in Chin Company receiving cash of $9,594,415.
Required:
| A. | Journalize the entries to
record the following (refer to the Chart of Accounts for exact
wording of account titles):
|
||||||
| B. | Determine the amount of the bond interest expense for the first year. | ||||||
| C. | Explain why the company was able to issue the bonds for only $9,594,415 rather than for the face amount of $10,000,000. |
In: Accounting
Suppose the 1-year effective annual interest rate is 4.6% and the 2-year effective rate is 3.2%. Compute the fixed rate in a 2-year amortizing interest rate swap based on $440,000 of notional principal in the first year and $240,000 in the second year.
Please show steps
a. 4.11%
b. 3.91%
c. 4.69%
d. 3.22%
e. 3.63%
In: Finance
Suppose you just bought a 15-year annuity of $7,700 per year at the current interest rate of 11 percent per year. What is the value of your annuity today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Present value $ ?
What happens to the value of your investment if interest rates suddenly drop to 6 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Present value $?
What if interest rates suddenly rise to 16 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Present Value $ ?
In: Finance
PROJECT CASH FLOW
Colsen Communications is trying to estimate the first-year cash flow (at Year 1) for a proposed project. The financial staff has collected the following information on the project:
| Sales revenues | $10 million |
| Operating costs (excluding depreciation) | 7 million |
| Depreciation | 2 million |
| Interest expense | 2 million |
The company has a 40% tax rate, and its WACC is 12%.
Write out your answers completely. For example, 13 million should be entered as 13,000,000.
In: Finance
17.
Mr. Thomas has $210 income this year and $180 income next year. The market interest rate is 5% per year. Mr. Thomas also has an investment opportunity in which he can invest $70 this year and receive $90 next year. Suppose Mr. Thomas consumes $90 this year and invests in the project. What will be his consumption next year?
$300
$358
$300
$322
In: Finance