Question

Problem 13-2A The comparative statements of Sunland Company are presented here. SUNLAND COMPANY Income Statements For the Years Ended December 31 2017 2016 Net sales $1,894,040 $1,754,000 Cost of goods sold 1,062,040 1,009,500 Gross profit 832,000 744,500 Selling and administrative expenses 503,500 482,500 Income from operations 328,500 262,000 Other expenses and losses Interest expense 24,100 22,100 Income before income taxes 304,400 239,900 Income tax expense 94,100 75,100 Net income $ 210,300 $ 164,800 SUNLAND COMPANY Balance Sheets December 31 Assets 2017 2016 Current assets Cash $ 60,100 $ 64,200 Debt investments (short-term) 74,000 50,000 Accounts receivable 121,300 106,300 Inventory 128,100 117,600 Total current assets 383,500 338,100 Plant assets (net) 664,000 535,300 Total assets $1,047,500 $873,400 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 163,500 $148,900 Income taxes payable 45,600 44,100 Total current liabilities 209,100 193,000 Bonds payable 235,000 215,000 Total liabilities 444,100 408,000 Stockholders’ equity Common stock ($5 par) 290,000 300,000 Retained earnings 313,400 165,400 Total stockholders’ equity 603,400 465,400 Total liabilities and stockholders’ equity $1,047,500 $873,400 All sales were on account. Net cash provided by operating activities for 2017 was $240,000. Capital expenditures were $136,000, and cash dividends were $62,300. Compute the following ratios for 2017. (Round all answers to 2 decimal places, e.g. 1.83 or 1.83%.) (a) Earnings per share $ (b) Return on common stockholders’ equity % (c) Return on assets % (d) Current ratio :1 (e) Accounts receivable turnover times (f) Average collection period days (g) Inventory turnover times (h) Days in inventory days (i) Times interest earned times (j) Asset turnover times (k) Debt to assets ratio % (l) Free cash flow $

Answer 1