90.2K

Verified Solution

Link Copied!

Calculate the following ratios for year 2014 (round all ratios to two places behind the decimal):

CAPTAIN JET INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31,2014 Sales Revenue 15,438 CAPTAIN JET INC. Less: Sales Return (50) INCOME STATEMENT Net Sales 15,388 FOR THE YEAR ENDED DECEMBER 31, 2014 Cost of Goods Sold 4,723 Gross Profit Retained Earnings, Beginnin 10,665 19,031 Utilities Expenses Salary and Wages Expenses Rent Expenses Net Income/Loss 1,519 333 Dividends Payment (100) 5,688 Retained Earnings, End of th 313 19,264 Depreciation Expenses 1,781 Interest Expenses Supplies Expenses 788 50 Bad Debt Expenses 163 Total Operating Expenses Earnings before Income Taxes 10,300 364 Income Tax Expenses 31 Earnings after Income Taxes 333 CAPTAIN JET INC. BALANCE SHEET 31-Dec-14 31-Dec-13 Current Assets Cash 10,600 5,150 Accounts Receivable 7,088 6,850 Inventories 5,052 5,000 Prepaid Insurance Prepaid Rent 68 68 500 63 Total Current Assets 23,307 17,130 Non-Current Assets C C Long-term Investments C Investments in equity securities 6,375 6,375 Land held for future development 5,688 5,688 Property, Plant, and Equipment Buildings Less: Accumulated Depreciation C 47,000 48,875 (25,219) (23,438) Intangible Assets C C Capitalized Development Costs 1,000 1,000 Goodwill 9,500 9,500 Other Identifiable Intangible Assets 6,000 6,000 Total Non-Current Assets 52,219 52,125 Total Assets 75,526 69,255 0 Current Liabilities C C Accounts payable Salary and Wages Payable Interest Payable 6,688 4,188 188 C 225 188 Unearned Revenue 1,500 1,500 Income Tax payable Property taxes payable Utilities payable 1,086 1,055 825 825 156 C Total Current Liabilities 10,668 7,755 Non-Current Liabilities 0 C Total Non-Current Liabilities 15,000 13,750 Total Liabilities 25,668 21,505 Stockholders' Equity Common Stock ($10 par, 11,000 and 10,000 shares) Preferred Stock (5 % dividend , $100 par values, 1050 and 1000 Paid-in-capital -Common Stock Paid-in-capital- Preferred Stock Retained Earnings C 0 13,750 12,500 13,125 12,500 3,438 3,438 1,250 1,250 19,264 19,031 Accumulated Other Comprehensive Income Less: Treasury Stock 625 625 (1,594) (1,594) Total Stockholders' Equity Total Liabilities and Stockholders' Equity 49,858 47,750 75,526 69,255 Calculate the following ratios for yeur 2014 (round all ratios to two places behind the decimal): 1Working capital 2 Current ratio 3 Acid test ratio 4 Accounts receivable turnover (use net sales as numerator) 5 Collection period of receivables (use 360 days in each year) 6 Accounts payable turnover ratio 7 Inventory turnover ratio 8 Days to sell inventory 9 Debt-to-Equity ratio 10 Times interest earned 11 RNOA (assume 12 % tax rate) 12 ROCE II II Provide projected Income Statement, Retained Earnings statement and Projected Balance Sheet on the right using the following assumptions: 1 sales growth is 110%; sales return, as a percentage of sales revenue, does not change 2 Gross profit margin is the same as 2014 profit margin 3 Depreciation expense/Prior PPE (gross) 4% 4 Interest expense/Prior year long-term debt 6% 5 All other expenses (insurance, supplies, utilities, bad debt and rent) grow at the same rate as sales growth. 6 Incometax expense/ pre-tax income 12 % A/R turnover is the same as that calculated for year 2014 A/P turnover is the same as that calculated for year 2014 7 8 Inventory turnover is the same as that calculated for year 2014 9 10 There is no change in current assets other than Cash, A/R and inventory 11 Capital expenditure/Sales 7 % 12 Assume no change in long-term assets except for PP&E. change in all liabili excpet for A 1 ssum 14 Assume no change in shareholders' Equity except for Retained Earnings 15 No dividend is paid on common stock and 5% dividend is paid on preferred stock CAPTAIN JET INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2014 Sales Revenue step 1 Less: Sales Return step 2 Net Sales Cost of Goods Sold step 4 Gross Profit step 3 Utilities Expenses Salary and Wages Expenses step 5 step 5 Rent Expenses step 5 Depreciation Expenses step 7 Interest Expenses Supplies Expenses Bad Debt Expenses Total operating Expenses Earnings before Income Taxes step 6 step 5 step 5 Income Tax Expenses step 8 Earnings after Income Taxes CAPTAIN JET INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2014 Retained Earnings, Beginning of the year Net Income/Loss Dividends Payment Retained Earnings, End of the year CAPTAIN JET INC Balance Sheet FOR THE YEAR ENDED DECEMBER 31, 2014 Current Assets Cash LAST STEP FOR THE YEAR ENDED DECEMBER 31, 2014 Current Assets Cash LAST STEP Accounts Receivable Use calculated A/R turnover from "ratios" Step 1 Use calculated inventory turnover from "ratios Inventories step 2 Prepaid Insurance Prepaid Rent step 3 step 3 Total Current Assets Non-Current Assets Long-term Investments Investments in equity securitie step4 Land held for future developm step 4 Property, Plant, and Equipment Buildings Less: Accumulated Depreciatic Intangible Assets Capitalized Development Cost step 5 step 6 step 7 Goodwill step 7 Other Identifiable Intangible A step 7 Total Non-Current Assets Total Assets Current Liabilities Accounts payable Salary and Wages Payable Interest Payable Use calculated A/P turnover from "ratios" step 8 step 9 step 9 Unearned Revenue step 9 Income Tax payable Property taxes payable Utilities payable step 9 step 9 step 9 Total Current Liabilities Non-Current Liabilities Notes payable step 10 Provisions Related to Pensions Bonds Pavable Bonds Payable Total Non-Current Liabilities Total Liabilities Stockholders' Equity step 12 Common Stock Preferred Stock (5% dividend) Paid-in-capital -Common Stock Paid-in-capital - Preferred Stock Retained Earnings Accumulated Other Comprehens step 12 step 12 step 12 step 11 step 12 Less: Treasury Stock step 12 Total Stockholders' Equity Total Liabilities and Stockholders' Equity

Answer & Explanation Solved by verified expert

See Answer