Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

تمرين 27

Financial Statement Analysis
Shown below are selected data from the financial statements of Hamilton Stores, a retail lighting store.

Instructions
a.xplain how the interest expense shown in the income statement could be $80,000, when the interest payment appearing in the statement of cash flows is only $72,000.
b.ompute the following (round to one decimal place):
1.urrent ratio Working capital
2.uick ratio
3.orking capital
4.ebt ratio
c.omment on these measurements and evaluate Hamilton's short-term debt-paying ability.
d.ompute the following ratios (assume that the year-end amounts of total assets and total stockholders' equity also represent the average amounts throughout the year):
1.eturn on assets
2.eturn on equity
e.omment on the company's performance under these measurements.xplain why the return on assets and return on equity are so different.
f.iscuss ( 1 )the apparent safety of long-term creditors' claims and ( 2 ) the prospects for Hamilton Stores continuing its dividend payments at the present level.