Chapter 5, Problem 20E

Certain financial ratios for The Gap for its most recent year are given below, along with the average ratios for its industry.  Based on those ratios, answer the following.  1) Does The Gap seem to prefer to finance its assets with debt or with equity?  How can you tell?  What percent of its assets are funded with debt?  What percent  of its assets are funded with equity?  2) A supplier to The Gap sells merchandise to The Gap and asks to be paid within 60 days.  While any of The Gap’s financial ratios might be of interest to the supplier, which of the ratios listed below do you think would likely be the most important one to the supplier?  Why?  3) Which of the ratios presented suggest that, compared to its industry, The Gap may have a problem controlling its operating expenses?  How can you tell?  Your answer should clearly indicate that you understand why the ratio that you chose answers this question.  Here is the data for The Gap and its industry. Financial Ratios…

A. Select a publicly-traded company that is traded on U.S. exchange. Locate the annual report for at least the last three fiscal years. Analyze the financial statements for the company and review for large movements in specific accounts from one year to the next. In addition, review the notes to the financial statements as these are an integral part of the financial reporting package. Evaluate the balance sheet to determine if there are large changes in the company's assets, liabilities, or equity accounts. In addition, analyze the income statement and statement of cash flows.B.  At a minimum, calculate the following ratios for two years, the debt-to-equity ratio, current ratio, quick ratio, return on equity, and net profit margin. For each ratio, explain what the ratio tells you about the company.

Company B, a CCPC provides you with the following income data for this fiscal year:       Aggregate Investment Income: $4,000   Active Business Income: $2,000   Canadian Dividends Connected (50% ownership, dividend refund received $1,500): $4,000   Canadian Dividends Non-connected: $3,000       What is Company's B's Taxable Income for this year ?

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 accountant of Crane Shoe has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2022. Rent revenue   £ 23,200 Interest expense   14,400 Unrealized gain on equity securities designated at fair           value through other comprehensive income, net of tax   24,800 Selling expenses   112,000 Income tax   24,480 Administrative expenses   144,800 Cost of goods sold   412,800 Net sales   784,000 Cash dividends declared   12,800 Loss on sale of plant assets   12,000 There were  20,000 ordinary shares outstanding during the year. (a)     Prepare a comprehensive income statement using the combined statement approach. (Round earnings per share to 2 decimal places, e.g. 1.48.) CRANE SHOEStatement of Comprehensive Incomechoose the accounting period   enter an income statement item     £ enter a pound amount enter an income statement item     enter a pound…

The accountant of Crane Shoe has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2022. Rent revenue   £ 23,200 Interest expense   14,400 Unrealized gain on equity securities designated at fair           value through other comprehensive income, net of tax   24,800 Selling expenses   112,000 Income tax   24,480 Administrative expenses   144,800 Cost of goods sold   412,800 Net sales   784,000 Cash dividends declared   12,800 Loss on sale of plant assets   12,000 There were  20,000 ordinary shares outstanding during the year. (a)   New attempt is in progress. Some of the new entries may impact the last attempt grading. Your answer is partially correct. Prepare a comprehensive income statement using the combined statement approach. (Round earnings per share to 2 decimal places, e.g. 1.48.) CRANE SHOEStatement of Comprehensive Incomechoose the accounting…