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Wahlberg Company Income Statement For the Years Ended December 31     2020   2019 Net sales   $ 1,810,000     $ 1,745,000   Cost of goods sold   1,005,000     970,000   Gross profit   805,000     775,000   Selling and administrative expenses   511,000     472,000   Income from operations   294,000     303,000   Other expenses and losses                Interest expense   17,000     13,000   Income before income taxes   277,000     290,000   Income tax expense   77,500     76,000   Net income   $  199,500     $  214,000

Wahlberg Company Income Statement For the Years Ended December 31     2020   2019 Net sales   $ 1,810,000     $ 1,745,000   Cost of goods sold   1,005,000     970,000   Gross profit   805,000     775,000   Selling and administrative expenses   511,000     472,000   Income from operations   294,000     303,000   Other expenses and losses                Interest expense   17,000     13,000   Income before income taxes   277,000     290,000   Income tax expense   77,500     76,000   Net income   $  199,500     $  214,000

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter5: Accounting For Retail Businesses
Section: Chapter Questions
Problem 41E: Cost of goods sold and related items The following data were extracted from the accounting records...
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The comparative statements of Wahlberg Company are presented here.

Wahlberg Company
Income Statement
For the Years Ended December 31
   
2020
  
2019
Net sales
   $ 1,810,000     $ 1,745,000  
Cost of goods sold
   1,005,000     970,000  
Gross profit
   805,000     775,000  
Selling and administrative expenses
   511,000     472,000  
Income from operations
   294,000     303,000  
Other expenses and losses
            
   Interest expense
   17,000     13,000  
Income before income taxes
   277,000     290,000  
Income tax expense
   77,500     76,000  
Net income
   $  199,500     $  214,000
Stockholders' equity Common stock ($5 par) 275,000 295,000 Retained earnings 264,000 162,000 Total stockholders' equity 539,000 457,000 Total liabilities and stockholders' equity $960,000 $ 842,000 All sales were on account. Net cash provided by operating activities for 2020 was $ 257,000. Capital expenditures were $ 123,000, and cash dividends were $ 97,500. Compute the following ratios for 2020. (Round Earnings per share, Current ratio and Asset turnover to 2 decimal places, e.g. 1.65 or 1.65:1, and all other answers to 1 decimal place, eg. 6.8 or 6.8%. Use 365 days for calculation.) (a) Earnings per share 3.6 (b) Return on common stockholders' equity 28.9 (c) Return on assets 22.1 (d) Current ratio 1.82 :1 (e) Accounts receivable turnover 16.68 times (f) Average collection period 21.9 days (g) Inventory turnover times 8.5 (h) Days in inventory 42.9 days (1) Times interest earned 17.3 times Asset turnover 2 times (k) Debt to assets ratio 43.9 (1) Free cash flow 36500 %24
Transcribed Image Text:Stockholders' equity Common stock ($5 par) 275,000 295,000 Retained earnings 264,000 162,000 Total stockholders' equity 539,000 457,000 Total liabilities and stockholders' equity $960,000 $ 842,000 All sales were on account. Net cash provided by operating activities for 2020 was $ 257,000. Capital expenditures were $ 123,000, and cash dividends were $ 97,500. Compute the following ratios for 2020. (Round Earnings per share, Current ratio and Asset turnover to 2 decimal places, e.g. 1.65 or 1.65:1, and all other answers to 1 decimal place, eg. 6.8 or 6.8%. Use 365 days for calculation.) (a) Earnings per share 3.6 (b) Return on common stockholders' equity 28.9 (c) Return on assets 22.1 (d) Current ratio 1.82 :1 (e) Accounts receivable turnover 16.68 times (f) Average collection period 21.9 days (g) Inventory turnover times 8.5 (h) Days in inventory 42.9 days (1) Times interest earned 17.3 times Asset turnover 2 times (k) Debt to assets ratio 43.9 (1) Free cash flow 36500 %24
The comparative statements of Wahlberg Company are presented here. Wahlberg Company Income Statement For the Years Ended December 31 2020 2019 Net sales $1810,000 $1.745,000 Cost of goods sold 1,005.000 970,000 Gross profit 805,000 775,000 Selling and administrative expenses 511,000 472,000 Income from operations 294,000 303,000 Other expenses and losses Interest expense 17,000 13,000 Income before income taxes 277,000 290,000 Income tax expense 77,500 76,000 Net income $ 199.500 $ 214,000 Wahlberg Company Balance Sheets December 31 Assets 2020 2019 Current assets Cash $59.000 $63,000 Debt investments (short-term) 68,000 49,000 Accounts receivable 116,000 101,000 Inventory 122,000 114,000 Total current assets 365,000 327,000 Plant assets (net) 595,000 515,000 Total assets $ 960,000 $842,000 Liabilities and Stockholders' Equity Current liabilities Accounts payable $ 159.000 $ 144,000 Income taxes payable 42,000 41,000 Total current liabilities 201,000 185,000 Bonds payable 220,000 200,000 Total liabilities 421,000 385,000 Stockholders' equity
Transcribed Image Text:The comparative statements of Wahlberg Company are presented here. Wahlberg Company Income Statement For the Years Ended December 31 2020 2019 Net sales $1810,000 $1.745,000 Cost of goods sold 1,005.000 970,000 Gross profit 805,000 775,000 Selling and administrative expenses 511,000 472,000 Income from operations 294,000 303,000 Other expenses and losses Interest expense 17,000 13,000 Income before income taxes 277,000 290,000 Income tax expense 77,500 76,000 Net income $ 199.500 $ 214,000 Wahlberg Company Balance Sheets December 31 Assets 2020 2019 Current assets Cash $59.000 $63,000 Debt investments (short-term) 68,000 49,000 Accounts receivable 116,000 101,000 Inventory 122,000 114,000 Total current assets 365,000 327,000 Plant assets (net) 595,000 515,000 Total assets $ 960,000 $842,000 Liabilities and Stockholders' Equity Current liabilities Accounts payable $ 159.000 $ 144,000 Income taxes payable 42,000 41,000 Total current liabilities 201,000 185,000 Bonds payable 220,000 200,000 Total liabilities 421,000 385,000 Stockholders' equity
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