Solve the below problem:
Q: Lundberg Corporation"s most recent balance sheet and income statement appear below:
Statement of Financial Position
December 31, Year 2 and Year 1
(in thousands of dollars)
Year 2 Year 1
Assets
Current assets:
Cash $ 100 $ 110
Accounts receivable 210 220
Inventory 110 120
Prepaid expenses 10 10
Total current assets 430 460
Plant and equipment, net 900 880
Total assets $ 1,330 $ 1,340
Liabilities and Stockholders" Equity
Current liabilities:
Accounts payable $ 160 $ 170
Accrued liabilities 50 50
Notes payable, short term 100 90
Total current liabilities 310 310
Bonds payable 190 240
Total liabilities 500 550
Stockholders" equity:
Preferred stock, $100 par value, 10% 200 200
Common stock, $1 par value 100 100
Additional paid-in capital--common stock 110 110
Retained earnings 420 380
Total stockholders" equity 830 790
Total liabilities & stockholders" equity $ 1,330 $ 1,340
Income Statement
For the Year Ended December 31, Year 2
(in thousands of dollars)
Sales (all on account) $ 1,330
Cost of goods sold 850
Gross margin 480
Selling and administrative expense 292
Net operating income 188
Interest expense 31
Net income before taxes 157
Income taxes (30%) 47
Net income $ 110
Dividends on common stock during Year 2 totaled $50 thousand. Dividends on preferred stock totaled $20 thousand. The market price of common stock at the end of Year 2 was $9.36 per share.
Required:
Compute the following for Year 2:
a. Gross margin percentage.
b. Earnings per share of common stock.
c. Price-earnings ratio.
d. Dividend payout ratio.
e. Dividend yield ratio.
f. Return on total assets.
g. Return on common stockholders" equity.
h. Book value per share.
i. Working capital.
j. Current ratio.
k. Acid-test ratio.
l. Accounts receivable turnover.
m. Average collection period. (Assume 365 days a year and round your answer to 1 decimal place.)
n. Inventory turnover.
o. Average sale period. (Assume 365 days a year and round your answer to 1 decimal place.)
p. Times interest earned.
q. Debt-to-equity ratio.