Some recent financial statements for Smolira Golf Corp. follow. |
SMOLIRA GOLF CORP. 2014 and 2015 Balance Sheets |
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Assets | Liabilities and Owners’ Equity | |||||||||||||||
2014 | 2015 | 2014 | 2015 | |||||||||||||
Current assets | Current liabilities | |||||||||||||||
Cash | $ | 23,056 | $ | 25,200 | Accounts payable | $ | 24,284 | $ | 28,200 | |||||||
Accounts receivable | 13,548 | 16,300 | Notes payable | 13,000 | 11,900 | |||||||||||
Inventory | 26,982 | 28,200 | Other | 12,671 | 19,900 | |||||||||||
Total | $ | 63,586 | $ | 69,700 | Total | $ | 49,955 | $ | 60,000 | |||||||
Long-term debt | $ | 80,000 | $ | 92,000 | ||||||||||||
Owners’ equity | ||||||||||||||||
Common stock and paid-in surplus | $ | 60,000 | $ | 60,000 | ||||||||||||
Accumulated retained earnings | 209,326 | 222,000 | ||||||||||||||
Fixed assets | ||||||||||||||||
Net plant and equipment | $ | 335,695 | $ | 364,300 | Total | $ | 269,326 | $ | 282,000 | |||||||
Total assets | $ | 399,281 | $ | 434,000 | Total liabilities and owners’ equity | $ | 399,281 | $ | 434,000 | |||||||
SMOLIRA GOLF CORP. 2015 Income Statement |
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Sales | $ | 375,123 | |||||
Cost of goods sold | 258,000 | ||||||
Depreciation | 45,600 | ||||||
Earnings before interest and taxes | $ | 71,523 | |||||
Interest paid | 15,400 | ||||||
Taxable income | $ | 56,123 | |||||
Taxes (40%) | 22,449 | ||||||
Net income | $ | 33,674 | |||||
Dividends | $ | 21,000 | |||||
Retained earnings | 12,674 | ||||||
Find the following financial ratios for Smolira Golf Corp. (use year-end figures rather than average values where appropriate): (Enter your profitability ratio answers as a percent rounded to 2 decimal places, e.g., 32.16. Round the remaining answers to 2 decimal places, e.g., 32.16.) |
Long-term solvency ratios: | 2014 | 2015 | |
g. | Total debt ratio | times | times |
h. | Debt–equity ratio | times | times |
i. | Equity multiplier | times | times |
j. | Times interest earned | times | |
k. | Cash coverage ratio | times | |
Profitability ratios: | |||
I. | Profit margin | % | |
m. | Return on assets | % | |
n. | Return on equity | % | |
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