Presented below is a condensed version of the comparative balance sheets for Son

Question

Presented below is a condensed version of the comparative balance sheets for Sondergaard Corporation for the last two years at December 31.

Additional information:

Investments were sold at a loss (not extraordinary) of $8,897; no equipment was sold; cash dividends paid were $63,550; and net income was $203,360.

(a) Prepare a statement of cash flows for 2012 for Sondergaard Corporation. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

2012
2011 Cash
$199,547

$99,138
Accounts receivable
228,780

235,135
Investments
66,092

94,054
Equipment
378,758

305,040
Less: Accumulated depreciation%u2014equipment
(134,726 )
(113,119 ) Current liabilities
170,314

191,921
Capital stock
203,360

203,360
Retained earnings
364,777

224,967

Explanation / Answer

(a) Current ratio = 35,500/12,370 = 2.87:1 (b) Acid-test ratio = 25,500/12,370 = 2.06:1 (c) Receivables turnover = 100,000/22,300 = 4.48 times (d) Inventory turnover = 60,000/8,500 = 7.06 times (e) Profit margin = 15,000/100,000 = 15% (f) Asset turnover = 100,000/115,300 = 0.87 times (g) Return on assets = 15,000/115,300 = 13.01% (h) Return on common stockholders

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