e Chegg Study I Guided SWX e Dive In Company was s Final Exam xM Final Exam Unti
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e Chegg Study I Guided SWX e Dive In Company was s Final Exam xM Final Exam Untitled document-Go - ezto.mheducation.com/hm.tpx The financial statements for Thor and Gunnar companies are summarized here Thor Gunnar Company Company Balance Sheet Cash Accounts Receivable, Net $ 32,000 74,000 148,000 764,000 193,000 $ 33,200 25,000 24,000 186,000 65,400 Equipment, Net Other Assets Total Assets $1,211,000 $333,600 Current Liabilities Note Payable (long-term) (12% interest rate) Common Stock (par $20) Additional Paid-in Capital Retained Earnings $162,000 260,000 669,000 67,000 53,000 $ 12,000 60,000 249,000 4,000 8,600 Total Liabilities and Stockholders' Equity $1,211,000 $333,600 Income Statement Sales Revenue Cost of Goods Sold Other Expenses $1,111,000 669,000 333,000 $327,000 177,000 111,000 Net Income $109,000 39,000 Other Data Per share price at end of year Selected Data from Previous Year Accounts Receivable, Net $ 13.00 $ 30.00 $ 62,800 $ 24,200 +1 4:49.0Explanation / Answer
(Value in $) 1 Net Profit Margin Net Profit after Taxes and Dividends Net Revenue where, Net Profits Sales less COGS,Operating Expeneses, Taxes, Dividends Net Revenue Total Income from Sales,Direct Incomes less Returns,allowances In the given question, data is readily available-: Thor Company Gunnar Company Net Profit- given after all necessary adjustments 1,09,000.00 39,000.00 Net Revenue 11,11,000.00 3,27,000.00 Net Profit Margin 1,09,000.00 39,000.00 11,11,000.00 3,27,000.00 Ratio(in percentage) 9.81 11.93 2 Gross Profit Margin Gross Profit Net Revenue where, Gross Profits Sales less Cost of Goods Sold Net Revenue Total Income from Sales,Direct Incomes less Returns,allowances Gross Profit Calculation Sales 11,11,000.00 3,27,000.00 Less-: Returns,other adj etc. 0.00 0.00 Net Revenue 11,11,000.00 3,27,000.00 Less-: Cost of Goods Sold 6,69,000.00 1,77,000.00 Gross Profit 4,42,000.00 1,50,000.00 Thor Company Gunnar Company Gross Profit Margin 4,42,000.00 1,50,000.00 11,11,000.00 3,27,000.00 Ratio(in percentage) 39.78 45.87 3 Fixed Asset Turnover Net Revenue Net Property,Pant and Equipment where, Net Revenue Total Income from Sales,Direct Incomes less Returns,allowances Net Property,Plant and Equipment Includes Property,Plant and Equipment less Depreciation Sales 11,11,000.00 3,27,000.00 Less-: Returns,other adj etc. 0.00 0.00 Net Revenue 11,11,000.00 3,27,000.00 Net Property,Plant and Equipment 7,64,000.00 1,86,000.00 (Given exclusively in the ques)-Assuming Other Assets to be Current) Fixed Asset Turnover(Times) 1.45 1.76 4 Return on Equity Earnings attributable to Eq. Sh. Shareholders Equity Earnings att. To ESH Net Income after taxes and Pref. Sh. Dividends Shareholders Equity Total Equity Share Capital + Retained Earnings Thor Company Gunnar Company Earnings att. To ESH Net Income(net of Taxes) 1,09,000.00 39,000.00 Less-:Pref Dividends 0.00 0.00 1,09,000.00 39,000.00 Shareholders Equity Common Stock 6,69,000.00 2,49,000.00 Addl. Paid in Capital 67,000.00 4,000.00 Retained Earnings 53,000.00 8,600.00 7,89,000.00 2,61,600.00 Return on Equity(in percentage) 1,09,000.00 39,000.00 7,89,000.00 2,61,600.00 13.81 14.91 5 Earning per Share Earning attributable to ESH Total Equity Shares Thor Company Gunnar Company Earnings att. To ESH Net Income(net of Taxes) 1,09,000.00 39,000.00 Less-:Pref Dividends 0.00 0.00 1,09,000.00 39,000.00 Total no. of Shares Common Stock 6,69,000.00 2,49,000.00 Addl. Paid in Capital 67,000.00 4,000.00 Total Equity Capital 7,36,000.00 2,53,000.00 Equity Capital 7,36,000.00 2,53,000.00 par value of Shares($20) 20 20 Total No. of Shares 36800 12650 Earning per Shares 1,09,000.00 39,000.00 36800 12650 EPS(in $) 2.96 3.08 6 Price Earning Ratio Market Price per Share Earning per Share Thor Company Gunnar Company Market Price per Share(given in ques)- 13 30 EPS(in $)-Calculated previously 2.96 3.08 Price Earning Ratio( Times) 4.39 9.74 7 Receivables Turnover Ratio Net Revenue Average Debtors Thor Company Gunnar Company Sales 11,11,000.00 3,27,000.00 Less-: Returns,other adj etc. 0.00 0.00 Net Revenue 11,11,000.00 3,27,000.00 Average Debtors Year end Debtors- Assumed to be average as per the questions directions) 74,000.00 25,000.00 Receivables Turnover Ratio 11,11,000.00 3,27,000.00 74,000.00 25,000.00 (Value in Times) 15.01 13.08 Days to Collect Total days in a year (Average collection period) Receivable Turnover Ratio Average Days 365.00 365.00 15.01 13.08 Days 24.31 27.91 8 Inventory Turnover Ratio Cost of Goods Sold Average Inventory Cost of Goods Sold Opening Stock +Purchases+ Expenses attributable to expenses-Closing Stock Thor Company Gunnar Company Cost of Goods Sold (Already calculated in the Ques) 6,69,000.00 1,77,000.00 Average Inventory Year end Inventory- Assumed to be average as per the questions directions) 1,48,000.00 24,000.00 Inventory Turnover Ratio 6,69,000.00 1,77,000.00 1,48,000.00 24,000.00 Ratio(Value in Times) 4.52 7.38 Days to Sell Total days in a year (Average payment period) Inventory Turnover Ratio Average Days 365.00 365.00 4.52 7.38 No. Of Days 80.75 49.49 9 Current Ratio Current Assets Current Liabilities Current Assets Cash+Debtors+Inventory+Other Assets convertible into cash within a year Current Liability Creditors+ Short Term Loans redemable within an Year+Bills payable Thor Company Gunnar Company Current Assets Cash 32,000.00 33,200.00 Accounts Receivable 74,000.00 25,000.00 Inventory 1,48,000.00 24,000.00 Other Assets(Assumed to be Current) 1,93,000.00 65,400.00 4,47,000.00 1,47,600.00 Current Liability 1,62,000.00 12,000.00 (given in the ques) Ratio 4,47,000.00 1,47,600.00 1,62,000.00 12,000.00 Value in Times 2.76 12.30 10 Debt to Assets Ratio Total Debts Total Assets Thor Company Gunnar Company Total Debts Current Liability 1,62,000.00 12,000.00 Notes payable 2,60,000.00 60,000.00 4,22,000.00 72,000.00 Total Assets 12,11,000.00 3,33,600.00 (Total of the Assets side of the Balance Sheet given in the Ques) Ratio 4,22,000.00 72,000.00 12,11,000.00 3,33,600.00 Value in Times 0.35 0.22
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