Acc300 Principles of Accounting: P2-6A Sievert Corporation

Acc300 Principles of Accounting
P2-6A
Condensed balance sheet and income statement data for Sievert Corporation are presented here and on the next page.
SIEVERT CORPORATION
Balance Sheets
31-Dec Assets
2012 2011
Cash 28,000 20,000
Receivables (net) 70,000 62,000
Other current assets 90,000 73,000
Long-term investments 62,000 60,000
Plant and equipment (net) 510,000 470,000
Total assets 760,000 685,000
Liabilities and Stockholders’ Equity
Current liabilities 75,000 70,000
Long-term debt 80,000 90,000
Common stock 330,000 300,000
Retained earnings 275,000 225,000
Total liabilities and stockholders’ equity 760,000 685,000

SIEVERT CORPORATION
Income Statements
For the Years Ended December 31 2012 2011
Sales 750,000 680,000
Cost of goods sold 440,000 400,000
Operating expenses (including income taxes) 240,000 220,000
Net income 70,000 60,000

Additional information:
Cash from operating activities 82,000 56,000
Cash used for capital expenditures 45,000 38,000
Dividends paid 20,000 15,000
Average number of shares outstanding 33,000 30,000

Instructions
Compute these values and ratios for 2011 and 2012.
(a) Earnings per share.
(b) Working capital.
(c) Current ratio.
(d) Debt to total assets ratio.
(e) Free cash flow.
(f ) Based on the ratios calculated, discuss briefly the improvement or lack thereof in financial position and operating results from 2011 to 2012 of Sievert Corporation.
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