RIVERSIDE SWEETS Balance Sheet June 30, 2018 and 2019 2019 2018 Assets Current Assets: Cash $ 25,000 $ 119,000 Short-term Investments 685,000 650,000 Accounts Receivable 225,000 198,000 Merchandise Inventory 65,000 70,000 Other Current Assets "95,000 191,000 Total Current Assets 1,295,000 1,228,000 Property, Plant, and Equipment, Net 875,000 832,000 Total Assets $ 2,170,000 $ 2,060,000 Liabilities Current Liabilities: Accounts Payable $ 265,000 $ 251,750 Accrued Liabilities 641,000 725,523 Total Current Liabilities 906,000 977,273 Long-term Liabilities Bonds Payable 250,000 150,000 Mortgage Payable 150,000 175,000 Total Long-term Liabilities 400,000 325,000 Total Liabilities 1,306,000 1,302,273 Stockholders' Equity Common Stock, $1 par, 225,000 shares issued and outstanding Paid-In Capital in Excess of Par 225,000 225,000 58,000 58,000 Retained Earnings 581,000 864,000 474,727 Total Stockholders' Equity 757,727 Total Liabilities and Stockholders' Equity $2,170,000 $ 2,060,000 RIVERSIDE SWEETS Income Statement Year Ended June 30, 2019 Net Sales Revenue $ 2,800,000 Cost of Goods Sold 1,551,600 Gross Profit 1,248,400 Operating Expenses 450,540 Operating Income 797,860 Other Income and (Expenses): Interest Expense (15,000) Income Before Income Taxes 782,860 Income Tax Expense 153,529 Net Income $ 629,331

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Using Excel for financial statement analysis

Download an Excel temp/ate for this problem online in MyAccountingLab or at http://www.pearsonhighered.com/Horngren Riverside Sweets, a retail candy store chain, reported the following figures:

Additional financial information:

a. 75% of net sales revenue are on account.

b. Market price of stock is $36 per share on June 30, 2019.

c. Annual dividend for 2019 was $1.50 per share.

d. All short-term investments are cash equivalents.

Requirements

Perform a horizontal analysis on the balance sheet for 2018 and 2019.
Perform a vertical analysis on the income statement.
Compute the following ratios:

a. Working Capital

b. Current Ratio

c. Acid-Test (Quick) Ratio

d. Cash Ratio

e. Accounts Receivable Turnover

f. Days’ Sales in Receivables

g. Inventory Turnover

h. Days’ Sales in Inventory

i. Gross Profit Percentage

j. Debt Ratio

k. Debt to Equity Ratio

l. Times-Interest-Earned Ratio

m. Profit Margin Ratio

n. Rate of Return on Total Assets

o. Asset Turnover Ratio

v. Rate of Return on Common Stockholders’ Equity

q. Earnings per Share (EPS)

r. Price/Earnings Ratio

s. Dividend Yield

t. Dividend Payout

RIVERSIDE SWEETS
Balance Sheet
June 30, 2018 and 2019
2019
2018
Assets
Current Assets:
Cash
$ 25,000
$ 119,000
Short-term Investments
685,000
650,000
Accounts Receivable
225,000
198,000
Merchandise Inventory
65,000
70,000
Other Current Assets
"95,000
191,000
Total Current Assets
1,295,000
1,228,000
Property, Plant, and Equipment, Net
875,000
832,000
Total Assets
$ 2,170,000
$ 2,060,000
Liabilities
Current Liabilities:
Accounts Payable
$ 265,000
$ 251,750
Accrued Liabilities
641,000
725,523
Total Current Liabilities
906,000
977,273
Long-term Liabilities
Bonds Payable
250,000
150,000
Mortgage Payable
150,000
175,000
Total Long-term Liabilities
400,000
325,000
Total Liabilities
1,306,000
1,302,273
Stockholders' Equity
Common Stock, $1 par, 225,000 shares
issued and outstanding
Paid-In Capital in Excess of Par
225,000
225,000
58,000
58,000
Retained Earnings
581,000
864,000
474,727
Total Stockholders' Equity
757,727
Total Liabilities and Stockholders' Equity
$2,170,000
$ 2,060,000

RIVERSIDE SWEETS
Income Statement
Year Ended June 30, 2019
Net Sales Revenue
$ 2,800,000
Cost of Goods Sold
1,551,600
Gross Profit
1,248,400
Operating Expenses
450,540
Operating Income
797,860
Other Income and (Expenses):
Interest Expense
(15,000)
Income Before Income Taxes
782,860
Income Tax Expense
153,529
Net Income
$ 629,331

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