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Financial Accounting (5th Edition) (What's New in Accounting)
5th Edition
ISBN: 9780134727790
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Question
Chapter 12, Problem 29BE
To determine
Identify whether the stock increased or decreased in attractiveness during the past two years using four ratios.
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OBJECTIVE: To enable learners to utilize financial ratios as a mechanism to evaluate the firm's financial
performance and identify areas for making decisions for improvement
REQUIREMENT: Financial Statement Analysis
Question
Refer to the following financial statements of Delima Corporation for 2019 and 2020:
Delima Corporation
Income Statements
For the year ended 31 December (in millions)
2020
$13,198
7,750
2019
$12,397
7,108
Net sales
Cost of goods sold
Gross profit
Selling and administrative expenses
Income from operations
5,448
5,289
3,472
3,299
1,976
1,990
Interest expense
233
248
Other (income) expense, net
11
1,732
503
1,229
Income before income taxes
1,742
Income tax expense
502
Net income
1,240
Delima Corporation
Balance Sheets
31 December (in millions)
2020
2019
Assets
Current assets
Cash
$460
$444
Accounts receivables (net)
1,188
1,132
1,190
1,056
225
2,915
3,128
Inventories
Other current assets
247
Total current assets
3,027
3,281
Property (net)
5,593
$11,901
Other assets…
(Learning Objectives 2, 3, 4: Reconstruct transactions from the financial statements)Parker Networking Solutions began operations on January 1, 2018, and immediately issuedits stock, receiving cash. Parker’s balance sheet at December 31, 2018, reported the followingstockholders’ equity:Common stock, $1 par...................... $ 59,000Additional paid-in capital.................. 473,500Retained earnings.............................. 40,000Treasury stock, 300 shares................ (3,600)Total stockholders’ equity............ $568,900During 2018, Parkera. issued stock for $9 per share.b. purchased 800 shares of treasury stock, paying $12 per share.c. resold some of the treasury stock.d. declared and paid cash dividends.
Using Excel to Calculate Equity Balances
PROBLEM
Pasta Creations issued additional shares of common shares,
reported net income, and declared dividends during the
year. Information concerning its equity is provided here.
Beginning of year common shares
Beginning of year retained earnings
Additional common shares issued
Net income reported
Dividends declared
$ 98,000
476,000
52,000
78,000
16,000
Student Work Area
Required: Provide input into cells shaded in yellow in this
template. Input the required mathematical formulas or functions
with cell references to the Problem area or work area as
a. Calculate the ending balances of (1) common shares, (2)
retained earnings, and (3) total shareholders' equity.
Common shares
Retained earnings
Total shareholders' equity
b. Calculate the same amounts if the company had reported a
net loss rather than net income and had not declared any
dividends.
Net loss amount
Common shares
Retained earnings
Total shareholders' equity
$
72,000
Chapter 12 Solutions
Financial Accounting (5th Edition) (What's New in Accounting)
Ch. 12 - Prob. 1DQCh. 12 - Which amount is the base amount for vertical...Ch. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - How would you expect a recession to affect asset...Ch. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 1SCCh. 12 - Prob. 2SCCh. 12 - Prob. 3SCCh. 12 - Prob. 4SCCh. 12 - Prob. 5SCCh. 12 - Prob. 6SCCh. 12 - Prob. 7SCCh. 12 - Prob. 8SCCh. 12 - Prob. 9SCCh. 12 - Prob. 10SCCh. 12 - Prob. 11SCCh. 12 - Prob. 12SCCh. 12 - Prob. 1SECh. 12 - Prob. 2SECh. 12 - Prob. 3SECh. 12 - Prob. 4SECh. 12 - Prob. 5SECh. 12 - Prob. 6SECh. 12 - Prob. 7SECh. 12 - Prob. 8SECh. 12 - Prob. 9SECh. 12 - Prob. 10SECh. 12 - Horizontal analysis(Learning Objective 2)15-20 min...Ch. 12 - Prob. 12AECh. 12 - Horizontal analysis(Learning Objective 2)15-20...Ch. 12 - Prob. 14AECh. 12 - Prob. 15AECh. 12 - Prob. 16AECh. 12 - Prob. 17AECh. 12 - Horizontal analysis(Learning Objective 2)15-20...Ch. 12 - Prob. 26BECh. 12 - Prob. 27BECh. 12 - Prob. 28BECh. 12 - Prob. 29BECh. 12 - Prob. 30BECh. 12 - Trend percentages and return on assets (Learning...Ch. 12 - Common-size financial statements and profitability...Ch. 12 - Current ratio, debt ratio, EPS (Learning Objective...Ch. 12 - Calculating various ratios for analysis (Learning...Ch. 12 - Prob. 35APCh. 12 - Prob. 36APCh. 12 - Trend percentages and return on assets (Learning...Ch. 12 - Common-size financial statements and profitability...Ch. 12 - Prob. 39BPCh. 12 - Calculating various ratios for analysis(Learning...Ch. 12 - Calculating various ratios for analysis (Learning...Ch. 12 - Prob. 42BPCh. 12 - Prob. 1CECh. 12 - Prob. 1CPCh. 12 - Prob. 1EIACh. 12 - Prob. 2EIACh. 12 - Prob. 1FACh. 12 - Industry Analysis Purpose: To help you understand...Ch. 12 - Prob. 1SBACh. 12 - Prob. 1WC
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