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Exam 16: Financial Statement Analysis

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Question 21

Multiple Choice

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Kearin Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $8,000. The market price of common stock at the end of Year 2 was $2.02 per share.The company's return on total assets for Year 2 is closest to:

A) 1.38%
B) 2.18%
C) 1.37%
D) 2.19%

E) A) and C)
F) None of the above

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Question 22

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Doonan Corporation has provided the following financial data from its balance sheet and income statement: The market price of common stock at the end of Year 2 was $4.79 per share.The company's return on total assets for Year 2 is closest to:

A) 1.77%
B) 2.46%
C) 1.80%
D) 2.42%

E) A) and D)
F) B) and C)

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Question 23

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Nickolls Corporation has provided the following financial data: The company's acid-test (quick) ratio is closest to:

Mars Corporation has provided the following data for Year 2: The company's total stockholders' equity at the end of Year 2 amounted to $1,095,000 and at the end of Year 1 to $1,060,000. The company's return on equity for Year 2 is closest to:

Symons Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $2,500. The market price of common stock at the end of Year 2 was $2.01 per share.The company's dividend yield ratio for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.)

Freiman Corporation's most recent balance sheet and income statement appear below: The current ratio at the end of Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's equity multiplier at the end of Year 2 is closest to:

All other things the same, purchasing inventory would decrease the inventory turnover ratio.

Dahn Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $1,600. The market price of common stock at the end of Year 2 was $2.37 per share. The company's accounts receivable turnover for Year 2 is closest to:

Hyrkas Corporation's most recent balance sheet and income statement appear below: Dividends on common stock during Year 2 totaled $30 thousand. The market price of common stock at the end of Year 2 was $6.90 per share.Required:Compute the following for Year 2:a. Gross margin percentage.b. Earnings per share.c. Price-earnings ratio.d. Dividend payout ratio.e. Dividend yield ratio.f. Return on total assets.g. Return on equity.h. Book value per share.i. Working capital.j. Current ratio.k. Acid-test (quick) ratio.l. Accounts receivable turnover.m. Average collection period.n. Inventory turnover.o. Average sale period.p. Times interest earned ratio.q. Debt-to-equity ratio.

Medina Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $2,000. The market price of common stock at the end of Year 2 was $1.49 per share.Required:a. What is the company's times interest earned ratio for Year 2?b. What is the company's debt-to-equity ratio at the end of Year 2?c. What is the company's equity multiplier at the end of Year 2?d. What is the company's net profit margin percentage for Year 2?e. What is the company's gross margin percentage for Year 2?f. What is the company's return on total assets for Year 2?g. What is the company's return on equity for Year 2?h. What is the company's earnings per share for Year 2?i. What is the company's price-earnings ratio for Year 2?j. What is the company's dividend payout ratio for Year 2?k. What is the company's dividend yield ratio for Year 2?l. What is the company's book value per share at the end of Year 2?

Zack Company has a current ratio of 2.5. What will be the effect of a purchase of inventory with cash on the acid-test ratio and on working capital?

The formula for the return on equity is: Return on equity = Net income ÷ Average total stockholders' equity.

Data from Keniston Corporation's most recent balance sheet and income statement appear below: The average collection period for this year is closest to: (Round your intermediate calculations to 2 decimal places.)

Dratif Corporation's working capital is $33,000 and its current liabilities are $80,000. The corporation's current ratio is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's times interest earned ratio for Year 2 is closest to:

Arkin Corporation's total current assets are $290,000, its noncurrent assets are $520,000, its total current liabilities are $210,000, its long-term liabilities are $420,000, and its stockholders' equity is $180,000.Required: Compute the company's working capital. Show your work!

Fayer Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $4,500. The market price of common stock at the end of Year 2 was $10.88 per share.The company's equity multiplier at the end of Year 2 is closest to:

Freiman Corporation's most recent balance sheet and income statement appear below: The acid-test (quick) ratio at the end of Year 2 is closest to:

Gambino Corporation has provided the following financial data: Required:a. What is the company's times interest earned ratio for Year 2?b. What is the company's debt-to-equity ratio at the end of Year 2?c. What is the company's equity multiplier at the end of Year 2?