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    Acctg 12 Second Seatwork

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    sarahbee
    The document provides the balance sheet and income statement for Pettijohn Inc. for the year 2010. It notes the firm has no amortization charges, does not lease any assets, has no debt that needs to be retired in the next 5 years, and will roll over its notes payable. The balance sheet shows total assets of $42 billion with current assets of $24.7 billion and total liabilities and equity also of $42 billion. The income statement shows net sales of $58.8 billion and net income of $1.1 billion.

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    Acctg 12 Second Seatwork

    Uploaded by

    sarahbee
    168 views6 pages
    The document provides the balance sheet and income statement for Pettijohn Inc. for the year 2010. It notes the firm has no amortization charges, does not lease any assets, has no debt that needs to be retired in the next 5 years, and will roll over its notes payable. The balance sheet shows total assets of $42 billion with current assets of $24.7 billion and total liabilities and equity also of $42 billion. The income statement shows net sales of $58.8 billion and net income of $1.1 billion.

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    Financial Statement Analysis

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    The document provides the balance sheet and income statement for Pettijohn Inc. for the year 2010. It notes the firm has no amortization charges, does not lease any assets, has no debt that needs to be retired in the next 5 years, and will roll over its notes payable. The balance sheet shows total assets of $42 billion with current assets of $24.7 billion and total liabilities and equity also of $42 billion. The income statement shows net sales of $58.8 billion and net income of $1.1 billion.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    168 views6 pages

    Acctg 12 Second Seatwork

    Uploaded by

    sarahbee
    The document provides the balance sheet and income statement for Pettijohn Inc. for the year 2010. It notes the firm has no amortization charges, does not lease any assets, has no debt that needs to be retired in the next 5 years, and will roll over its notes payable. The balance sheet shows total assets of $42 billion with current assets of $24.7 billion and total liabilities and equity also of $42 billion. The income statement shows net sales of $58.8 billion and net income of $1.1 billion.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 6

    The balance sheet and income statement shown below are for Pettijohn Inc.

    Note
    that the firm has no amortization charges, it does not lease any assets, none
    of its debt must be retired during the next 5 years, and the notes payable will
    be rolled[ over.

    Balance Sheet (Millions of $)


    Assets 2010
    Cash and securities $1,554.0
    Accounts receivable 9,660.0
    Inventories 13,440.0
    Total current assets $24,654.0
    Net plant and equipment 17,346.0
    Total assets $42,000.0
    Liabilities and Equity
    Accounts payable $7,980.0
    Notes payable 5,880.0
    Accruals 4,620.0
    Total current liabilities $18,480.0
    Long-term bonds 10,920.0
    Total debt $29,400.0
    Common stock 3,360.0
    Retained earnings 9,240.0
    Total common equity $12,600.0
    Total liabilities and equity $42,000.0
    Income Statement (Millions of $) 2010
    $58,800.0
    Net sales
    0
    Operating costs except depr’n $54,978.0
    Depreciation $1,029.0
    Earnings bef int and taxes (EBIT) $2,793.0
    Less interest 1,050.0
    Earnings before taxes (EBT) $1,743.0
    Taxes $610.1
    Net income $1,133.0
    Other data:
    Shares outstanding (millions) 175.00
    Common dividends $509.83
    Int rate on notes payable & L-T bonds 6.25%
    Federal plus state income tax rate 35%
    Year-end stock price $77.69

    (3.2) Calculating ratios given financial stmts CK Answer: d MEDIUM


    i. What is the firm's current ratio?

    a. 0.97
    b. 1.08
    c. 1.20
    d. 1.33
    e. 1.47

    (3.2) Calculating ratios given financial stmts CK Answer: b MEDIUM


    ii. What is the firm's quick ratio?

    a. 0.49
    b. 0.61
    c. 0.73
    d. 0.87
    e. 1.05

    (3.3) Calculating ratios given financial stmts CK Answer: e MEDIUM


    iii What is the firm's days sales outstanding? Assume a 360-day year for
    . this calculation.

    a. 48.17
    b. 50.71
    c. 53.38
    d. 56.19
    e. 59.14

    (3.3) Calculating ratios given financial stmts CK Answer: c MEDIUM


    iv. What is the firm's total assets turnover?

    a. 0.90
    b. 1.12
    c. 1.40
    d. 1.68
    e. 2.02

    (3.3) Calculating ratios given financial stmts Answer: a MEDIUM


    CK
    v. What is the firm's inventory turnover ratio?

    a. 4.38
    b. 4.59
    c. 4.82
    d. 5.06
    e. 5.32

    (3.4) Calculating ratios given financial stmts Answer: d MEDIUM


    CK
    vi. What is the firm's TIE?

    a. 1.94
    b. 2.15
    c. 2.39
    d. 2.66
    e. 2.93

    (3.4) Calculating ratios given financial stmts Answer: c MEDIUM


    CK
    vii. What is the firm's EBITDA coverage?

    a. 3.29
    b. 3.46
    c. 3.64
    d. 3.82
    e. 4.01

    (3.4) Calculating ratios given financial stmts Answer: e MEDIUM


    CK
    viii What is the firm's debt ratio?
    .

    a. 45.93%
    b. 51.03%
    c. 56.70%
    d. 63.00%
    e. 70.00%

    (3.5) Calculating ratios given financial stmts Answer: a MEDIUM


    CK
    ix. What is the firm's ROA?

    a. 2.70%
    b. 2.97%
    c. 3.26%
    d. 3.59%
    e. 3.95%

    (3.5) Calculating ratios given financial stmts Answer: b MEDIUM


    CK
    x. What is the firm's ROE?

    a. 8.54%
    b. 8.99%
    c. 9.44%
    d. 9.91%
    e. 10.41%

    (3.5) Calculating ratios given financial stmts Answer: c MEDIUM


    CK
    xi. What is the firm's BEP?

    a. 6.00%
    b. 6.32%
    c. 6.65%
    d. 6.98%
    e. 7.33%

    (3.5) Calculating ratios given financial stmts Answer: d MEDIUM


    CK
    xii. What is the firm's profit margin?

    a. 1.40%
    b. 1.56%
    c. 1.73%
    d. 1.93%
    e. 2.12%

    (3.5) Calculating ratios given financial stmts Answer: b MEDIUM


    CK
    xiii What is the firm's dividends per share?
    .

    a. $2.62
    b. $2.91
    c. $3.20
    d. $3.53
    e. $3.88

    (3.5) Calculating ratios given financial stmts Answer: e MEDIUM


    CK
    xiv. What is the firm's cash flow per share?

    a. $10.06
    b. $10.59
    c. $11.15
    d. $11.74
    e. $12.35

    (3.6) Calculating ratios given financial stmts Answer: c MEDIUM


    CK
    xv. What is the firm's EPS?

    a. $5.84
    b. $6.15
    c. $6.47
    d. $6.80
    e. $7.14

    (3.6) Calculating ratios given financial stmts Answer: a MEDIUM


    CK
    xvi. What is the firm's P/E ratio?

    a. 12.0
    b. 12.6
    c. 13.2
    d. 13.9
    e. 14.6

    (3.6) Calculating ratios given financial stmts Answer: d MEDIUM


    CK
    xvii. What is the firm's book value per share?
    a. $61.73
    b. $64.98
    c. $68.40
    d. $72.00
    e. $75.60

    (3.6) Calculating ratios given financial stmts Answer: e MEDIUM


    CK
    xviii What is the firm's market-to-book ratio?
    .

    a. 0.56
    b. 0.66
    c. 0.78
    d. 0.92
    e. 1.08

    (3.8) Calculating ratios given financial stmts Answer: a MEDIUM


    CK
    xix. What is the firm's equity multiplier?

    a. 3.33
    b. 3.50
    c. 3.68
    d. 3.86
    e. 4.05

    i. (3.2) Calculating ratios given financial stmts C K Answer: d MEDIUM

    Current ratio = Current assets/Current liabilities = 1.33

    ii. (3.2) Calculating ratios given financial stmts C K Answer: b MEDIUM

    Quick ratio = (CA – Inventory)/CL = 0.61

    iii. (3.3) Calculating ratios given financial stmts C K Answer: e MEDIUM

    DSO = Accounts receivable/(Sales/360) = 59.14

    iv. (3.3) Calculating ratios given financial stmts C K Answer: c MEDIUM

    Total assets turnover ratio = Sales/Total assets = 1.40

    v. (3.3) Calculating ratios given financial stmts C K Answer: a MEDIUM

    Inventory turnover ratio = Sales/Inventory = 4.38

    vi. (3.4) Calculating ratios given financial stmts C K Answer: d MEDIUM

    TIE = EBIT/Interest charges = 2.66

    vii. (3.4) Calculating ratios given financial stmts C K Answer: c MEDIUM


    EBITDA covg =(EBITDA + lease)/(Int + principal + lease) = 3.64

    viii. (3.4) Calculating ratios given financial stmts C K Answer: e MEDIUM

    Debt ratio = Total debt/Total assets = 70.0%

    ix. (3.5) Calculating ratios given financial stmts C K Answer: a MEDIUM

    ROA = Net income/Total assets = 2.70%

    x. (3.5) Calculating ratios given financial stmts C K Answer: b MEDIUM

    ROE = Net income/Common equity = 8.99%

    xi. (3.5) Calculating ratios given financial stmts C K Answer: c MEDIUM

    BEP = EBIT/Total assets = 6.65%

    xii. (3.5) Calculating ratios given financial stmts C K Answer: d MEDIUM

    Profit margin = Net income/Sales = 1.93%

    xiii. (3.5) Calculating ratios given financial stmts C K Answer: b MEDIUM

    DPS = Common dividends paid/Shares outstanding = $2.91

    xiv. (3.5) Calculating ratios given financial stmts C K Answer: e MEDIUM

    CFPS = (Net income + Depreciation)/Shares outstanding = $12.35

    xv. (3.6) Calculating ratios given financial stmts C K Answer: c MEDIUM

    EPS = Net income/common shares outstanding = $6.47

    xvi. (3.6) Calculating ratios given financial stmts C K Answer: a MEDIUM

    P/E ratio = Price per share/Earnings per share = 12.0

    xvii. (3.6) Calculating ratios given financial stmts C K Answer: d MEDIUM

    BVPS = Common equity/Shares outstanding = $72.00

    xviii. (3.6) Calculating ratios given financial stmts C K Answer

    Market/book ratio (M/B) = Price per share/BVPS = 1.08

    xix. (3.8) Calculating ratios given financial stmts C K Answer: a MEDIUM

    Equity multiplier = Total assets/Common equity = 3.33

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