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Comparative financial statement data of Danfield, Inc., follow:

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Comparative financial statement data of Danfield, Inc., follow;Danfield, Inc.;Comparative Income Statement;Years Ended December 31, 2012 and 2011;2015 2014;Net sales 467,000 428,000;Cost of goods sold 237,000 218,000;Gross profit 230,000 210,000;Operating expenses 136,000 134,000;Income from operations 94,000 76,000;Interest expense 9,000 10,000;Income before income tax 85,000 66,000;Income tax expense 24,000 27,000;Net income 61,000 39,000;Danfield, Inc.;Comparative Balance Sheet;Years Ended December 31, 2012 and 2011;2015 2014 2013*;Current assets;Cash 97,000 95,000;Current receivables, net 112,000 118,000 102,000;Inventories 145,000 163,000 203,000;Prepaid expenses 12,000 5,000;Total current assets 366,000 381,000;Property, plant, and equipment, net 211,000 179,000;Total assets 577,000 560,000 598,000;Total current liabilities 225,000 246,000;Long-term liabilities 114,000 97,000;Total liabilities 339,000 343,000;Preferred stock, 3% 108,000 108,000;Common stockholders' equity, no par 130,000 109,000;Total liabilities and stockholders' equity 577,000 560,000;* Selected 2010 amounts;1. Market price of Danfield's common stock: $86.58 at December 31, 2015 and $46.54 at December 31, 2014.;2. Common shares outstanding: 12,000 during 2015 and 10,000 during 2014 and 2013.;3. All sales on credit.;Required;A. Compute the following ratios for 2015 and 2014;1. Current ratio;2. Cash ratio;3. Times-interest-earned ratio;4. Inventory turnover;5. Gross profit percentage;6. Debt to equity ratio;7. Rate of return on common stockholders' equity;8. Earnings per share of common stock;9. Price/earnings ratio;B. Decide (a) whether Danfield?s ability to pay debts and to sell inventory improved or deteriorated during 2015 and (b) whether the investment attractiveness of its common stock appears to have increased or decreased.

 

Paper#76548 | Written in 18-Jul-2015

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