1.Kingbird, Inc. has the following Income Statement (in millions):
KINGBIRD, INC.
Income Statement
For the Year Ended December 31, 2023
Net Sales
$164
Cost of Goods Sold
94
Gross Profit
70
Operating Expenses
50
Net Income
$ 20
Using vertical analysis, what percentage is assigned to net sales?
74%
100%
174%
Can’t be computed
2. Marin Inc. has the following income statement (in millions):
MARIN INC.
Income Statement
For the Year Ended December 31, 2023
Net Sales
$400
Cost of Goods Sold
256
Gross Profit
144
Operating Expenses
68
Net Income
$ 76
Using vertical analysis, what percentage is assigned to net income?
19%
30%
100%
81%
3. Given the following data for the Sunland Company:
Current liabilities
$590
Long-term debt
480
Common stock
891
Retained earnings
739
Total liabilities & stockholders’ equity
$2700
How would common stock appear on a common size balance sheet?
33%
25%
35%
85%
4. Blue Spruce Corp. had a balance in the Accounts Receivable account of $788000 at the beginning of the year and a balance of $842000 at the end of the year. Net credit sales during the year amounted to $5705000. The average collection period of the accounts receivable in terms of days was
53.7 days.
41.5 days.
104.3 days.
52.1 days.
5. Bramble Corp. had net credit sales of $13010000 and cost of goods sold of $10512000 for the year. The average inventory for the year amounted to $2190000. The inventory turnover for the year is
5.9 times.
1.1 times.
4.8 times.
1.2 times.
6. Metlock, Inc. had net credit sales of $9022000 and cost of goods sold of $5322000 for the year. The average inventory for the year amounted to $1341000. The average days in inventory during the year was approximately
92 days.
73 days.
54 days.
68 days.
7. Pina Colada Corp. had net income of $1615000 and paid dividends to common stockholders of $403750 in 2022. The weighted average number of shares outstanding in 2022 was 468350 shares. Pina Colada Corp. common stock is selling for $30 per share on the NASDAQ. Pina Colada Corp. price-earnings ratio is
3.4 times.
4.0 times.
8.7 times.
8.0 times.
8. Tamarisk, Inc. had net income of $1623000 and paid dividends to common stockholders of $405750 in 2022. The weighted average number of shares outstanding in 2022 was 1038720 shares. Tamarisk, Inc.’s common stock is selling for $40 per share on the NASDAQ. Tamarisk, Inc.’s payout ratio for 2022 is
25%.
$4 per share.
16%.
4%.
9. Wildhorse Co. reported the following on its income statement:
Income before income taxes
$803000
Income tax expense
134000
Net income
$669000
An analysis of the income statement revealed that interest expense was $73000. Wildhorse Co.’s times interest earned was
12 times.
7 times.
14 times.
11 times.
10. The current assets of Nash’s Trading Post, LLC are $299000. The current liabilities are $130000. The current ratio expressed as a proportion is
$130000 ÷ $299000.
0.43:1.
2.30:1.
230%.
11. The following information pertains to Novak Corp. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
Assets
Cash and short-term investments
$ 53200
Accounts receivable (net)
39400
Inventory
31700
Property, plant and equipment
219000
Total Assets
$343300
Liabilities and Stockholders’ Equity
Current liabilities
$ 52100
Long-term liabilities
81200
Stockholders’ equity—common
210000
Total Liabilities and Stockholders’ Equity
$343300
Income Statement
Sales revenue
$113000
Cost of goods sold
69600
Gross profit
43400
Operating expenses
24500
Net income
$ 18900
Number of shares of common stock
9100
Market price of common stock
$23
Dividends per share on common stock
1.4
Cash provided by operations
$50000
What is the return on assets for this company?
5.5%
12.6%
9.0%
14.6%
12. The following information pertains to Tamarisk, Inc. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
Assets
Cash and short-term investments
$ 54200
Accounts receivable (net)
30000
Inventory
29700
Property, plant and equipment
216000
Total Assets
$329900
Liabilities and Stockholders’ Equity
Current liabilities
$ 50900
Long-term liabilities
85700
Stockholders’ equity—common
193300
Total Liabilities and Stockholders’ Equity
$329900
Income Statement
Sales revenue
$115000
Cost of goods sold
73500
Gross profit
41500
Operating expenses
17500
Net income
$ 24000
Number of shares of common stock
14200
Market price of common stock
$28
Dividends per share on common stock
5.8
Cash provided by operations
$40000
What is the return on common stockholders’ equity for this company?
12.4%
15.2%
18.0%
21.5%
13. The following information is available for Swifty Corporation:
2022
2021
Accounts receivable
$ 363000
$ 350000
Inventory
284000
345000
Net credit sales
3315450
2615000
Cost of goods sold
1822000
859000
Net income
325000
182000
The accounts receivable turnover for 2022 is
4.7 times.
9.5 times.
9.3 times.
9.1 times.
14. The following amounts were taken from the financial statements of Nash’s Trading Post, LLC:
2022
2021
Total assets
$801000
$1010000
Net sales
720000
651000
Gross profit
352000
321000
Net income
90550
110000
Weighted average number of
common shares outstanding
85000
80000
Market price of common stock
$40
$30
The return on assets for 2022 is
5%.
9%.
11%.
10%.
15. Novak’s by the Tracks has the following partial balance sheet:
NOVAK’S BY THE TRACKS
Balance Sheet (partial)
Stockholders’ equity:
Common stock
$6024000
Retained earnings
2024000
Total paid-in capital and retained earnings
8048000
Accumulated other comprehensive income
804800
Total stockholders’ equity:
$8852800
What effect will the accumulated other comprehensive income have on comprehensive income?
Increase of $804800 in comprehensive income.
Decrease of $8048000 in comprehensive income.
Increase of $8852800 in comprehensive income.
No effect on comprehensive income.
16. Carla Vista Co. reported net sales of $410000, $451000, and $557600 in the years 2021, 2022, and 2023, respectively. If 2021 is the base year, what is the trend percentage for 2023?
136%
74%
124%
110%
17. Assume the following cost of goods sold data for a company:
2023
$1351680
2022
1223000
2021
1024000
If 2021 is the base year, what is the percentage increase in cost of goods sold from 2021 to 2023?
19%
32%
11%
132%
18. If Year 1 cost of goods sold equals $820, Year 2 cost of goods sold equals $950, and Year 3 cost of goods sold equals $600, the percentage to be assigned for Year 1 in a trend analysis, assuming that Year 1 is the base year, is
137%.
73%.
100%.
116%.
19. If Year 1 sales equal $890, Year 2 sales equal $1246, and Year 3 sales equal $1160, the percentage to be assigned for Year 2 in a trend analysis, assuming that Year 1 is the base year, is
130%.
71%.
93%.
140%.
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