The following is a summary of information presented on the financial statements of a company on 31 December 2020. Account 2020 2019 Current assets $68,000 $52,000 Accounts receivable 84,000 80,000 Inventory 52,000 41,000 Current liabilities 76,000 49,000 Non-current liabilities 32,000 55,000 Share capital 51,000 42,000 Retained earnings 45,000 27,000 Sales revenue $526,000$501,000 Cost of sales 402,000 400,000 Gross profit $124,000$101,000 Selling expenses 47,000 51,000 Profit before income tax $77,000 $50,000 Income tax expense 24,000 $16,900 Profit $53,000 $33,100 What would a horizontal analysis report show with respect to Current liabilities? Select one: O a. a 35.53% increase in Current Liabilities O b. Current Liabilities are 37.25% of total capital. O c. a 55.1% increase in Current Liabilities O d. a current ratio of 0.89

The following is a summary of information presented on the financial statements of a company on 31 December 2020. Account 2020 2019 Current assets $68,000 $52,000 Accounts receivable 84,000 80,000 Inventory 52,000 41,000 Current liabilities 76,000 49,000 Non-current liabilities 32,000 55,000 Share capital 51,000 42,000 Retained earnings 45,000 27,000 Sales revenue $526,000$501,000 Cost of sales 402,000 400,000 Gross profit $124,000$101,000 Selling expenses 47,000 51,000 Profit before income tax $77,000 $50,000 Income tax expense 24,000 $16,900 Profit $53,000 $33,100 What would a horizontal analysis report show with respect to Current liabilities? Select one: O a. a 35.53% increase in Current Liabilities O b. Current Liabilities are 37.25% of total capital. O c. a 55.1% increase in Current Liabilities O d. a current ratio of 0.89

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 10MC

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Leverage Cook Corporation issued financial statements at December 31, 2019, that include the following information: Balance sheet at December 31,2019 Assets $8,000,000 Liabilities $1,200,000 Stockholders' equity (300,000 shares) $6,800,000 Income statement for 2019: Income from operations $1,200,000 Less: Interest expense (100,000) Income before taxes $1,100,000 Less: Income taxes expense (0,30) (330,000) Net income $ 770,000 The levels of assets, liabilities, stockholders' equity, and operating income have been stable in recent years; however, Cook Corporation is planning a 51,800,000 expansion program that will increase income from operations by $350,000 to $1,550,000, Cook is planning to sell 8.5% notes at par to finance the expansion. Required: What earnings per share does Cook report before the expansion?
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