Solved

Maynard Company's Balance Sheet and Income Statement Are Provided Below

Question 151

Essay

Maynard Company's balance sheet and income statement are provided below:
 Maynard Company Balance Sheet As of December 31 , Cash $83,500$92,000 Accounts receivable 94,00090,000 Inventory 62,50060,000 Plant and equipment, net 500,000525,000 Land 150,000150,000 Total assets $890,000$917,000 Liabilities and Stockholders’Equity  Accounts payable $73,000$62,000 Notes payable 115,000160,000 Capital stock, no par 440,000400,000 Retained earnings 262,000295,000 Total liabilities and stockholders’ equity $890,000$917,000\begin{array}{c}\text { Maynard Company}\\\text { Balance Sheet}\\\text { As of December 31 ,}\\\begin{array}{lrr}\text { Cash } & \$ 83,500 & \$ 92,000 \\\text { Accounts receivable } & 94,000 & 90,000 \\\text { Inventory } & 62,500 & 60,000 \\\text { Plant and equipment, net } & 500,000 & 525,000 \\\text { Land } &\underline{ 150,000}& \underline{ 150,000} \\\text { Total assets } & \underline{ \$ 890,000} &\underline{ \$ 917,000} \\\text { Liabilities and Stockholders'Equity }\\\text { Accounts payable } & \$ 73,000 & \$ 62,000 \\\text { Notes payable } & 115,000 & 160,000\\\text { Capital stock, no par } & 440,000 & 400,000 \\\text { Retained earnings } &\underline{ 262,000 }& \underline{295,000} \\\text { Total liabilities and stockholders' equity } & \underline{\$ 890,000 }&\underline{ \$ 917,000}\end{array}\end{array}
Maynard Company Income Statement Years Ended December 31 Year 2 Year 1 Sales $549,000$468,150 Less cost of goods sold 360,000289,500 Gross margin 189,000178,650 Less operating expenses 86,50055,450 Income before taxes 102,500123,200 Income taxes 18,50016,600 Net income $84,000$106,600\begin{array}{c}\text {Maynard Company}\\\text { Income Statement }\\\text {Years Ended December 31}\\\begin{array}{lrr}&\text { Year } 2 & \text { Year } 1\\\text { Sales } & \$ 549,000 &\$468,150 \\\text { Less cost of goods sold } & 360,000 & 289,500 \\\text { Gross margin } & 189,000 & 178,650 \\\text { Less operating expenses } & 86,500 & 55,450 \\\text { Income before taxes } & 102,500& 123,200 \\\text { Income taxes } & 18,500& 16,600\\\text { Net income } & \$ 84,000 & \$ 106,600\end{array}\end{array}
The company paid cash dividends of $2.00 per share during Year 2.On December 31,Year 2,the stock was listed on the stock exchange at a price of $78.25 per share.
Required:
Compute the following ratios for Year 2:
(a)Accounts receivable turnover
(b)Average days to collect receivables
(c)Inventory turnover
(d)Average days to sell inventory
(e)Debt to assets ratio
(f)Debt to equity ratio
(g)Net margin
(h)Asset turnover
(i)Return on investment
(j)Dividend yield
Round your answers to one decimal place.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents