Based upon the given financial statement, would you provide a credit line to this company? Support your decision by reference to your work in parts (1) through (4). KPC's CorporationVertical Analysis Income StatementFor this year and last yearThis YearAmountPercent680,000100.0%410,00060.3%270,00039.75190,00027.9%80,00011.8%1.0%73,00010.7%22,0003.2%51,0007.5%KPC's CorporationVertical Analysis Balance SheetFor this year and last yearThis YearAmountPercent50,0008.8%80,00014.0%180,00031.6%310,000 34.4%300,00052.6%0.0%-40.000570,000 100.0%100,00017.5%70,00012.3%80,00014.0%250.00043.9%130,00022.8%190.00033.3%320,00056.1%570,000 100.0%Net SalesCost of goods soldGross profitOperating expensesOperating incomeInterest expenseProfit before taxesTaxesNet incomeASSETSCashAccounts receivableInventoriesTotal Current AssetsPlant & equipmentLess accumulated depreciationTotal AssetsLIABILITIES AND EQUITYAccounts payableAccrued liabilitiesMortgage payableTotal LiabilitiesStockholder's EquityCommon stockRetained earningsTotal Stockholder's EquityTotal Liabilities and Equity7,000Last YearAmount600,000330,000270,000192,00078,0002,00076,00022,80053,200Last YearAmount40,00060,000110,000210.000260,000-20.000450,000150,00050,000200,00090,000160.000250,000450,000Percent100.0%55.0%45.0%32.0%13.0%0.3%12.7%3.8%8.9%Percent8.9%13.3%24.4%46.7%57.8%-4.4%100.0%33.3%11.1%0.0%44.4%20.0%35.6%55.65100.0%= KPC CorporationCash Flow Statement Indirect MethodFor the year ended December 31, This yearParticularsCash flow from Operating ActivityAdjustments to reconcile net income toDepreciation on Fixed assetsoperating profit before working capital changesIncrease Accounts receivableIncrease InventoriesDecrease Accounts PayableIncrease Accrued Liabilitiescash generation from Operating ActivityCash flow from investing activitiesPurchase of Plant & EquipmentCash generation from investing ActivitiesCash flow fron Financing activitiesIssue of common stockIssue Mortgage PayableDividend PaidCash generation from financing ActivitiesNet Increase in cash and cash equivalentBeginning Cash BalanceEnding Cash BalanceA1 Particulars2 Efficiency ratios3 Total assets turnover ratio4 Accounts receivables ratio5 Accounts payable ratio6 Inventory turnover ratio7Days sales in Inventory ratio=360/B689 Liquidity ratios10 Current ratio11 Quick ratio12 Cash ratio1314 Leverage ratios15 Debt equity ratio16 Debt ratio1718 Profitability ratios19 Gross Profit margin20 Net Profit margin21 Operating profit margin22 Return on assetsNet income$51,00020,00071,000(20,000)(70,000)(50,000)20,000(49,000)(40,000.00)(40,000)40,00080,000(21,000)BсCurrent Year Previous Year-680000/570000-600000/450000-680000/80000=600000/60000-410000/100000-330000/150000-410000/180000 -330000/110000=360/C6=310000/170000=210000/200000=130000/170000-100000/200000-50000/170000-40000/200000=250000/320000-200000/250000=250000/570000-200000/450000=270000/680000 -270000/600000-51000/680000 -53200/600000-80000/680000 -53200/78000-51000/570000-53200/450000$(49,000)(40,000)99,00010,00040,00050,000

Name: Based upon the given financial statement, would you provide a credit
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Description: Based upon the given financial statement, would you provide a credit line to this company? Support your decision by reference to your work in parts (1) through (4). KPC's CorporationVertical Analysis Income StatementFor this year and last yearThis Y

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Based upon the given financial statement, would you provide a credit line to this company? Support your decision by reference to your work in parts (1) through (4)

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter11: The Corporate Income Tax

Section: Chapter Questions

Problem 5P: Fisafolia Corporation has gross income from operations of $210,000 and operating expenses of...

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