the following information was drawn from the balance sheets of the kansas and montana companies: current assets: kansas-54,000 montana- 76,000 current liabilites: kansas-27000 montana-30400 a. compute the current ration for each company. b. which company has the greater likelihood of being able to pay its bills? c. assume that both companies have the same amount of total assets. Speculate as to which company would produce the higher return on assets ratio?

the following information was drawn from the balance sheets of the kansas and montana companies: current assets: kansas-54,000 montana- 76,000 current liabilites: kansas-27000 montana-30400 a. compute the current ration for each company. b. which company has the greater likelihood of being able to pay its bills? c. assume that both companies have the same amount of total assets. Speculate as to which company would produce the higher return on assets ratio?

Name: the following information was drawn from the balance sheets of the kan
Uploaded: 2022-11-18T00:26:54.000Z
Channel: Bartleby
Description: the following information was drawn from the balance sheets of the kansas and montana companies:current assets: kansas-54,000 montana- 76,000current liabilites: kansas-27000 montana-30400a. compute the current ration for each company.b. which company

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 32BEB

See similar textbooks

Similar questions

Grammatico Company has just completed its third year of operations. The income statement is as follows: Selected information from the balance sheet is as follows: Required: Note: Round answers to two decimal places. 1. Compute the times-interest-earned ratio. 2. Compute the debt ratio. 3. CONCEPTUAL CONNECTION Assume that the lower quartile, median, and upper quartile values for debt and times-interest-earned ratios in Grammaticos industry are as follows: How does Grammatico compare with the industrial norms? Does it have too much debt?
[The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. BarcoCompany KyanCompany BarcoCompany KyanCompany Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 770,000 $ 914,200 Cash $ 21,000 $ 34,000 Cost of goods sold 587,100 642,500 Accounts receivable, net 34,400 59,400 Interest expense 9,100 17,000 Merchandise inventory 84,940 132,500 Income tax expense 14,800 25,238 Prepaid expenses 5,400 7,350 Net income 159,000 229,462 Plant assets, net 310,000 307,400 Basic earnings per share 3.79 5.08 Total assets $ 455,740 $ 540,650 Cash dividends per share 3.82 4.01 Liabilities and Equity Beginning-of-year balance sheet data Current…
The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. BarcoCompany KyanCompany BarcoCompany KyanCompany Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 770,000 $ 914,200 Cash $ 21,000 $ 34,000 Cost of goods sold 587,100 642,500 Accounts receivable, net 34,400 59,400 Interest expense 9,100 17,000 Merchandise inventory 84,940 132,500 Income tax expense 14,800 25,238 Prepaid expenses 5,400 7,350 Net income 159,000 229,462 Plant assets, net 310,000 307,400 Basic earnings per share 3.79 5.08 Total assets $ 455,740 $ 540,650 Cash dividends per share 3.82 4.01 Liabilities and Equity Beginning-of-year balance sheet data Current…
Using the income statement for Times Mirror and Glass Co., compute the following ratios: TIMES MIRROR AND GLASS COMPANY Sales $ 244,000 Cost of goods sold 135,000 Gross profit $ 109,000 Selling and administrative expense 47,900 Lease expense 18,200 Operating profit* $ 42,900 Interest expense 8,300 Earnings before taxes $ 34,600 Taxes (30%) 13,840 Earnings after taxes $ 20,760 *Equals income before interest and taxes. The total assets for this company equal $240,000. Set up the equation for the Du Pont system of ratio analysis. Compute the profit margin ratio?
Use the information provided from Sapphire Ltd to calculate the ratios for 2022 (expressed to two decimal places) that would reflect each of the following:1. The profit of the company relative to sales after deducting the cost of sales.2. The ability of the company to profitably utilize its capital, which includes both debt and equity.3. The proportion of the total assets that are financed by total debt.4. The ability of the company to repay its short-term debts under distress conditions, on the assumption that inventories would have no value at all.5. The portion of the company's profit that is allocated to each outstanding ordinary share.6. An indication of the percentage of profit that has been put back into the company.
There are two companies in the market. Company A in 2022 has generated a revenue of $74,452,000 with a cost $74,132,000. Company B in 2022 has generated a revenue of $12,148,000 with a cost $11,988,000. According to their financial reports, the value of the assets owned by the company A is $40,000,000, including $20,000,000 liabilities. The value of the assets owned by the company B is $30,000,000, including $20,000,000 liabilities. 1) Calculate ROA, ROE, profit margin and asset turnover for company A. 2) Calculate ROA and ROE for company B and decide which company has a better financial performance.
Select financial information for Beta Corp. for the fiscal years ending December 20X4 and 20X5 is as follows: please find the attached image 1 and 2 5. Beta Corp. has calculated the following asset management ratios: Asset management 20X5 20X4A/R turnover 3.3 5.1Inventory turnover 1.4 1.2 Based on the above ratios, which of the following statements is true? a) Beta was more efficient in collecting its credit sales from customers in 20X5 than in the prior year. It was also more efficient in turning inventory into sales than in the prior year.b) Beta was less efficient in collecting its credit sales from customers in 20X5 than in the prior year. It was also less efficient in turning inventory into sales than in the prior year.c) Beta was less efficient in collecting its credit sales from customers in 20X5 than in the prior year. However, it was more efficient in turning inventory into sales than in the prior year.d) Beta was more efficient in…
From the following information for BlueInks Corporation, compute the rate of return on assets. Hint: The numerator is income before interest expense and taxes. Net income $40,878 Total assets at beginning of year $250,100 Total assets at end of year $158,680 a. 15% b. 25% c. 16% d. 20%
Presented below is the 2021 income statement and comparative balance sheet information for Tiger Enterprises. TIGER ENTERPRISES Income Statement For the Year Ended December 31, 2021 ($ in thousands) Sales revenue $ 7,840 Operating expenses: Cost of goods sold $ 3,500 Depreciation expense 380 Insurance expense 240 General and administrative expense 1,940 Total operating expenses 6,060 Income before income taxes 1,780 Income tax expense (740 ) Net income $ 1,040 Balance Sheet Information ($ in thousands) Dec. 31,2021 Dec. 31, 2020 Assets: Cash $ 440 $ 340 Accounts receivable 890 970 Inventory 780 740 Prepaid insurance 120 90 Equipment 2,800 2,500…
Halliburton and Schlumberger compete in the oil field services sector. Refer to the following 2018 financial data for the two companies to answer the requirements. $ millions HAL SLB Total revenue $21,596 $29,534 Pretax net nonoperating expense 588 383 Net income 1,740 2,286 Average operating assets 24,529 71,228 Average operating liabilities 5,299 14,849 Marginal tax rate 22% 19% Return on equity 18.56% 5.86% a. Compute return on net operating assets (RNOA) for each company.b. Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company.Do not round until your final answer. Round answers to two decimal places (percentage example: 0.12345 = 12.35%). HAL SLB RNOA Answer Answer NOPM Answer Answer NOAT Answer Answer
The table below contains data on Fincorp Inc. The balance sheet items correspond to values at year-end 2018 and 2019, while the income statement items correspond to revenues or expenses during the year ending in either 2018 or 2019. All values are in thousands of dollars. 2018 2019 Revenue $ 3,900 $ 4,000 Cost of goods sold 1,200 1,300 Depreciation 470 490 Inventories 330 400 Administrative expenses 470 520 Interest expense 180 180 Federal and state taxes* 480 500 Accounts payable 350 410 Accounts receivable 370 445 Net fixed assets† 5,000 5,850 Long-term debt 2,300 5,100 Notes payable 790 520 Dividends paid 490 490 Cash and marketable securities 2,525 410 * Taxes are paid in their entirety in the year that the tax obligation is incurred. † Net fixed assets are fixed assets net of accumulated depreciation since the asset was…
Presented below are the 2021 income statement and comparative balance sheets for Santana Industries. SANTANA INDUSTRIES Income Statement For the Year Ended December 31, 2021 ($ in thousands) Sales revenue $ 16,250 Service revenue 5,400 Total revenue $ 21,650 Operating expenses: Cost of goods sold 8,200 Selling expense 3,400 General and administrative expense 2,500 Total operating expenses 14,100 Operating income 7,550 Interest expense 250 Income before income taxes 7,300 Income tax expense 2,600 Net income $ 4,700 Balance Sheet Information ($ in thousands) Dec. 31, 2021 Dec. 31, 2020 Assets: Cash $ 9,300 $ 3,100 Accounts receivable 4,500 3,200 Inventory 6,000 4,000 Prepaid rent 250 500 Equipment 16,500 14,000 Less: Accumulated depreciation (6,100 ) (5,500 ) Total assets $ 30,450 $ 19,300 Liabilities and Shareholders’ Equity: Accounts payable $ 3,400 $ 2,100 Interest payable 200 0 Deferred revenue 1,000 700 Income taxes payable 650 1,000 Notes payable (due 12/31/2023) 7,000 0 Common…