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    Viewing Solutions Inc. - measures of solvency and profitability

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    Viewing Solutions Inc.
    Comparative Retained Earnings Statements
    For the Year Ended December 31, 2010 and 2009

    Retained earnings, January 1 604,000 306,000
    Add net income for year 428,000 314,000
    Total 1,032,000 620,000
    Deduct dividends:
    On preferred stock 4,000 4,000
    On common stock 12,000 12,000
    Total 16,000 16,000
    Retained earnings, December 31 1,016,000 604,000

    Viewing Solutions Inc
    Comparative Income Statement
    For the Year Ended December 31, 2010 and 2009

    Sales 1,608,000 1,481,600
    Sales return and allowances 5,920 6,000
    New Sales 1,602,080 1,475,000
    Cost of Goods sold 480,200 499,200
    Gross Profit 1,121,880 976,400
    Selling Expenses 324,000 352,000
    Administrative expenses 234,000 211,200
    Total operating expenses 558,000 563,200
    Income from operations 563,880 413,200
    Other Income 24,000 19,200 587,880 432,400
    Other expense (interest) 110,720 80,000
    Income before income tax 447,160 352,400
    Income tax expense 49,160 38,400
    Net Income 428,000 314,000

    Viewing Solutions Inc.
    Comparative Balance Sheet
    December 31, 2010 and 2009

    Current Assets
    Cash 240,000 162,400
    Temporary investments 364,000 328,800
    Account Receivable (net) 260,000 211,200
    Inventories 208,000 66,400
    Prepaid Expenses 44,000 23,200
    Total current assets 1,116,000 2,024,000

    Long term investments 204,800 320,000
    Property, plant and equipment (net) 1,539,200 976,000
    Total assets 2,860,000 2,024,000

    Liabilities

    Current liabilities 360,000 320,000
    Long term liabilities
    Mortgage note payable, 8%, due 2018 384,000
    Bonds payable, 10%, due 2019 800,000 800,000
    Total long term liabilities 1,184,000 1,120,000
    Total liabilities 1,544,000 1,120,000

    Stockholders' equity

    Preferred $2.00 stock, $50 par 100,000 100,000
    Common stock, $5 par 200,000 200,000
    Retained earnings 1,016,000 604,000
    Total stockholders' equity 1,316,000 904,000
    Total liabilities and stockholders' equity 2,860,000 2,024,000

    Determine the following measures for 2010, rounding to one decimal place

    1. Working capital
    2. Current ratio
    3. Quick ratio
    4. Account receivable turnover
    5. Number of days sales in receivables
    6. Inventory turnover
    7. Number of days' sales in inventory
    8. Ratio of fixed assets to long-term liabilities
    9. Ratio of liabilities to stockholders equity
    10. Number of times interests charges earned
    11. Number of times preferred dividends earned
    12. Ratio of net sales to assets
    13. Rate earned on total assets
    14. Rate earned on stockholders equity
    15. Rate earned on common stockholders equity
    16. Earning per share on common stock
    17. Price-earnings ratio
    18. Dividends per share on common stock
    19. Dividend yield

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    https://brainmass.com/business/profitability-index/viewing-solutions-measures-solvency-profitability-413432

    Solution Summary

    A measure of solvency and profitability for Viewing Solutions Inc is examined. Comparative retained earnings statements are provided.

    $2.49

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