Compute the return on assets and current ratios

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Reference no: EM131129689

The comparative statements of Lucille Company are presented here.

LUCILLE COMPANY
Income Statements
For the Years Ended December 31

 

2012

2011

Net sales

$1,890,540

$1,750,500

Cost of goods sold

1,058,540

1,006,000

Gross profit

832,000

744,500

Selling and administrative expenses

500,000

479,000

Income from operations

332,000

265,500

Other expenses and losses Interest expense

22,000

20,000

Income before income taxes

310,000

245,500

Income tax expense

92,000

73,000

Net income

$ 218,000

$ 172,500

Compute ratios from balance sheets and income statements. (SO 6), AP

LUCILLE COMPANY
Balance Sheets
31-Dec

Assets

2012

2011

Current assets

 

 

Cash

$60,100

$64,200

Short-term investments

74,000

50,000

Accounts receivable

117,800

102,800

Inventory

126,000

115,500

Total current assets

377,900

332,500

Plant assets (net)

649,000

520,300

Total assets

$1,026,900

$852,800

Liabilities and Stockholders' Equity

 

 

Current liabilities

 

 

Accounts payable

$160,000

$145,400

Income taxes payable

43,500

42,000

Total current liabilities

203,500

187,400

Bonds payable

220,000

200,000

Total liabilities

423,500

387,400

Stockholders' equity

 

 

Common stock ($5 par)

290,000

300,000

Retained earnings

313,400

165,400

Total stockholders' equity

603,400

465,400

Total liabilities and stockholders' equity

$1,026,900

$852,800

All sales were on account. Net cash provided by operating activities for 2012 was $220,000. Capital expenditures were $136,000, and cash dividends were $70,000.

Instructions

Compute the following ratios for 2012.

1. Earnings per share.
2. Return on common stockholders' equity.
3. Return on assets.
4. Current ratio.
5. Receivables turnover.
6. Average collection period.
7. Inventory turnover.
8. Days in inventory.
9. Times interest earned.
10. Asset turnover.
11. Debt to total assets.
12. Current cash debt coverage.
13. Cash debt coverage.
14. Free cash flow.

Reference no: EM131129689

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