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Practice Quiz 1 Use the following information to answer questions 1 through 5.                              &

Practice Quiz 1

Use the following information to answer questions 1 through 5.

                                                            Balance Sheet

                                         2009        2010                                                                 2009       2010

Cash                             $  3,300  $   2,700            Accounts payable                        $  9,600   $12,900

Accounts receivable             8,100       9,600            Long-term debt                             17,800     23,400

Inventory                         13,500     14,800            Preferred stock                              10,000     10,000

                                                                        Common stock                              12,000     14,000

Net fixed assets                    46,900     47,100            Retained earnings                                      22,400     13,900

Total assets                    $71,800   $74,200            Total liabilities and equity             $71,800   $74,200

                                                      Income Statement, 2010

                                                Net Sales                       $73,500

                                                Costs                               48,600

                                                Depreciation                       6,300

                                                EBIT                               18,600

                                                Interest                              1,700

                                                Taxable income                 16,900

                                                Taxes                               5,800

                                                Net Income                      $11,100

                                                         

                                                          No. of common shares outstanding = 10,000

                                                Preferred dividends paid   =             $    500

1.     What is the amount of the non-cash expenses for 2010?

2.     What is the book value per share for 2010?

3.     What is the change in net working capital for 2010?

4.     What is the earnings per share for 2010?

                     

5.         What is the debt ratio for 2010?

Business   Accounting   
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Homework Answers

Answer #1

1. Non Cash Expense : Depreciation =$6300

Part-2
Book Value per Share = ( Equity- Preferred Stock)/ No. of Common Stock
=((10000+14000+13900)-10000)/10000= $2.79 per Share
Part-3
Change in Net Working Capital for 2010
Ending Working Capital- Beginning Working Capital
=(2700+9600+14800-12900)-(3300+8100+13500-9600)=-$1100
Part-4
Earing per share for 2010= (Net Income- Preference dividend)/Outstanding shares
=(11100-500)/10000=$1.06 per share
Part-5
Debt Ratio for 2010= Total Debt / Total Asset
=(12900+23400)/(2700+9600+14800)=1.34 times
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