chapter13probsetc

# chapter13probsetc - PROBLEM SET C PROBLEM 13-1C Selected...

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PROBLEM SET C PROBLEM 13-1C Selected comparative financial statements of Shipshape Company follow: SHIPSHAPE COMPANY Comparative Income Statement For Years Ended December 31, 2006, 2005, and 2004 2006 2005 2004 Sales \$167,200 \$125,500 \$76,000 Cost of goods sold 71,060 65,260 33,440 Gross profit \$96,140 \$60,240 \$42,560 Selling expenses 12,540 10,291 7,828 Administrative expenses 40,797 26,104 13,528 Total expenses \$53,337 \$36,395 \$21,356 Income before taxes \$42,803 \$23,845 \$21,204 Income taxes 12,841 7,154 6,361 Net income \$29,962 \$16,691 \$14,843 SHIPSHAPE COMPANY Comparative Balance Sheet December 31, 2006, 2005, and 2004 2006 2005 2004 Assets Current assets \$34,420 \$28,888 \$21,789 Long-term investments 0 500 2,550 Plant assets, net 82,000 64,000 50,000 Total assets \$116,420 \$93,388 \$74,339 Liabilities and Equity Current liabilities \$20,010 \$15,340 \$14,300 Common stock 48,000 48,000 40,000 Other contributed capital 10,000 10,000 8,000 Retained earnings 38,410 20,048 12,039 Total liabilities and equity \$116,420 \$93,388 \$74,339 Required 1. Compute each year’s current ratio. 2. Express the income statement data in common-size percents. 3. Express the balance sheet data in trend percents with 2004 as the base year. Analysis Component 4. Comment on any significant relations revealed by the ratios and percents computed.

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PROBLEM 13-2C Selected comparative financial statements of Florencencia Company follow: FLORENCENCIA COMPANY Comparative Income Statement (\$000) For Years Ended December 31, 2006 – 2000 2006 2005 2004 2003 2002 2001 2000 Sales \$1,583 \$1,246 \$1,193 \$1,148 \$1,027 \$946 \$820 Cost of goods sold 1,031 913 758 684 631 600 505 Gross profit \$552 \$333 \$435 \$464 \$396 \$346 \$315 Operating expenses 283 241 223 155 126 124 111 Net income \$ 269 \$92 \$212 \$309 \$270 \$222 \$204 FLORENCENCIA COMPANY Comparative Balance Sheet (\$000) December 31, 2007 – 2001 2006 2005 2004 2003 2002 2001
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