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8. Make an investment analysis for 1998 by computing: a. Equity Ratio b. Creditors Equity to Total Assets c. Book Value Per Share on Common Stock

8. Make an investment analysis for 1998 by computing: a. Equity Ratio b. Creditors Equity to Total Assets c. Book Value Per Share on Common Stock

Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 9.6E
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FINANCIAL STATEMENT ANALYSIS AND RATIO ANALYSIS The following are the balance sheet and income statement data of PRT Company: December 31 Balance Sheet Accounts 1997 1998 Cash P30,000 P52,000 Marketable Securities 170,000 200,000 Accounts Receivable, net 100,000 200,000 Inventories 150,000 100,000 Machinery and Equipment, net 340,000 300,000 110,000 Land and Building, net Goodwill 80,000 100,000 80,000 18,000 Deferred Charges 20,000 Notes Payable, Trade 20,000 30,000 122,000 158,000 Accounts Payable, Trade Expenses Payable 12,000 8,000 500,000 450,000 100,000 100,000 Long-term Notes-Due 2008 15% Preferred Stock, P100 par Common Stock, P10 par Retained Earnings 200,000 200,000 50,000 100,000 1998 Income Statement Accounts Sales Sales Returns and Allowances P1,050,000 50,000 100,000 Inventory, December 31, 1998 Inventory, December 31, 1997 150,000 Purchases Selling Expenses Administrative Expenses (including depreciation of P25,000) 550,000 80,000 120,000 50,000 52,500 Interest on Long-term Notes Income Taxes, 35% Additional Information: 1. Dividends paid on preferred stock 15,000 2. Dividends paid on common stock 32,500 18 3. Market price per share of common stock 8. Make an investment analysis for 1998 by computing: a. Equity Ratio b. Creditors Equity to Total Assets c. Book Value Per Share on Common Stock 8
Transcribed Image Text:FINANCIAL STATEMENT ANALYSIS AND RATIO ANALYSIS The following are the balance sheet and income statement data of PRT Company: December 31 Balance Sheet Accounts 1997 1998 Cash P30,000 P52,000 Marketable Securities 170,000 200,000 Accounts Receivable, net 100,000 200,000 Inventories 150,000 100,000 Machinery and Equipment, net 340,000 300,000 110,000 Land and Building, net Goodwill 80,000 100,000 80,000 18,000 Deferred Charges 20,000 Notes Payable, Trade 20,000 30,000 122,000 158,000 Accounts Payable, Trade Expenses Payable 12,000 8,000 500,000 450,000 100,000 100,000 Long-term Notes-Due 2008 15% Preferred Stock, P100 par Common Stock, P10 par Retained Earnings 200,000 200,000 50,000 100,000 1998 Income Statement Accounts Sales Sales Returns and Allowances P1,050,000 50,000 100,000 Inventory, December 31, 1998 Inventory, December 31, 1997 150,000 Purchases Selling Expenses Administrative Expenses (including depreciation of P25,000) 550,000 80,000 120,000 50,000 52,500 Interest on Long-term Notes Income Taxes, 35% Additional Information: 1. Dividends paid on preferred stock 15,000 2. Dividends paid on common stock 32,500 18 3. Market price per share of common stock 8. Make an investment analysis for 1998 by computing: a. Equity Ratio b. Creditors Equity to Total Assets c. Book Value Per Share on Common Stock 8
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