Explore BrainMass
Share

Explore BrainMass

    Balance Sheet and Income Statement Analysis

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    The balance sheet and income statement shown below are for Kryloc Inc. You will find that the firm has no amortization charges. It also does not lease any assets and none of its debt must be retired during the next 5 years. The notes payable will be rolled over.

    Balance Sheet (Millions of $)
    Assets 2010
    Cash and securities $ 2,500
    Accounts receivable 11,500
    Inventories 16,000
    Total current assets $30,000
    Net plant and equipment $20,000
    Total assets $50,000

    Liabilities and Equity
    Accounts payable $9,500
    Notes payable 7,000
    Accruals 5,500
    Total current liabilities $22,000
    Long-term bonds $15,000
    Total debt $37,000
    Common stock $2,000
    Retained earnings 11,000
    Total common equity $13,000
    Total liabilities and equity $50,000

    Income Statement (Millions of $) 2010
    Net sales $87,500
    Operating costs except depreciation 81,813
    Depreciation 1,531
    Earnings bef interest and taxes (EBIT) $4,156
    Less interest 1,375
    Earnings before taxes (EBT) $2,781
    Taxes 973
    Net income $1,808

    Other data:
    Shares outstanding (millions) 500.00
    Common dividends $632.73
    Int rate on notes payable & L-T bonds 6.25%
    Federal plus state income tax rate 35%
    Year-end stock price $43.39

    Assignment Questions

    i. What is the firm's current ratio?
    ii. What is the firm's quick ratio?
    iii. What is the firm's "days sales outstanding" (DSO)? Assume a 365-day year for this calculation.
    iv. What is the firm's total assets turnover?
    v. What is the firm's inventory turnover ratio?
    vi. What is the firm's TIE?
    vii. What is the firm's debt/assets ratio?
    viii. What is the firm's ROA?
    ix. What is the firm's ROE?
    x. What is the firm's dividends per share?
    xi. What is the firm's EPS?
    xii. What is the firm's P/E ratio?
    xiii. What is the firm's book value per share?

    © BrainMass Inc. brainmass.com April 3, 2020, 11:58 pm ad1c9bdddf
    https://brainmass.com/business/financial-statements/balance-sheet-income-statement-analysis-526797

    Solution Preview

    Please refer to the attachment.

    Thank you for using BrainMass. Have a great day.

    The balance sheet and income statement shown below are for Kryloc Inc. You will find that the firm has no amortization charges. It also does not lease any assets and none of its debt must be retired during the next 5 years. The notes payable will be rolled over.

    Balance Sheet (Millions of $)
    Assets 2010
    Cash and securities $ 2,500
    Accounts receivable 11,500
    Inventories 16,000
    Total current assets $30,000
    Net plant and equipment $20,000
    Total assets $50,000

    Liabilities and Equity
    Accounts payable $9,500
    Notes payable 7,000 ...

    Solution Summary

    The balance sheet and income statement analysis are examined. Notes with payable roll over are determined.

    $2.19

    ADVERTISEMENT