The comparative statements of Larker Tool Company are presented below. - 10392

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The comparative statements of Larker Tool Company are presented below.

 

 

LARKER TOOL COMPANY

 

Income Statement

 

For the Year Ended December 31

 

 

2013

 

2012

 

Net sales

$1,814,990

 

$1,746,790

 

Cost of goods sold

1,008,390

 

996,800

 

Gross profit

806,600

 

749,990

 

Selling and administrative expense

511,776

 

472,183

 

Income from operations

294,824

 

277,807

 

Other expenses and losses

 

 

 

 

   Interest expense

18,908

 

13,829

 

Income before income taxes

275,916

 

263,978

 

Income tax expense

81,626

 

77,786

 

Net income

$ 194,290

 

$ 186,192

 

 

 

 

 

 

LARKER TOOL COMPANY

 

Balance Sheets

 

December 31

 

Assets

2013

 

2012

 

Current assets

 

 

 

 

   Cash

$ 60,990

 

$ 63,396

 

   Short-term investments

69,283

 

50,889

 

   Accounts receivable (net)

116,248

 

102,452

 

   Inventory

123,980

 

115,289

 

        Total current assets

370,501

 

332,026

 

Plant assets (net)

604,040

 

517,410

 

Total assets

$974,541

 

$849,436

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

Current liabilities

 

 

 

 

   Accounts payable

$159,915

 

$145,143

 

   Income taxes payable

43,966

 

42,442

 

        Total current liabilities

203,881

 

187,585

 

Bonds payable

204,400

 

204,400

 

        Total liabilities

408,281

 

391,985

 

Stockholders' equity

 

 

 

 

   Common stock ($5 par)

283,600

 

302,000

 

   Retained earnings

282,660

 

155,451

 

        Total stockholders' equity

566,260

 

457,451

 

Total liabilities and stockholders' equity

$974,541

 

$849,436

 

All sales were on account. The allowance for doubtful accounts was $3,410 on December 31, 2013, and $2,664 on December 31, 2012.

 

Instructions

 

Compute the following ratios for 2013. (Weighted average common shares in 2013 were 60,000.) (a) Earnings per share. (b) Return on common stockholders' equity. (c) Return on assets. (d) Current. (e) Acid-test. (f) Receivables turnover. (g) Inventory turnover. (h) Times interest earned. (i) Asset turnover. (j) Debt to total assets. (Round earnings per share, current ratio and acid-test ratio to 2 decimal places, e.g. 10.50. Round other answers to 1 decimal place, e.g. 10.5.)

 

 

 

 

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