321

colspan="5">You must compute dividends paid.  All dividends were paid in cash.
 P13-3A  Perform ratio analysis, and discuss change in financial position and operating results Condensed balance sheet and income statement data for Jernigan Corporation are presented here. JERNIGAN CORPORATION Balance Sheet December31 2014 2013 2012 Cash \$30,000 \$20,000 \$18,000 Accounts receivable (net) 50,000 45,000 48,000 Other current assets 90,000 95,000 64,000 Investments 55,000 70,000 45,000 Plant and equipment (net) 500,000 370,000 358,000 \$725,000 \$600,000 \$533,000 Current liabilities \$85,000 \$80,000 \$70,000 Long-term debt 145,000 85,000 50,000 Common stock, \$10 par 320,000 310,000 300,000 Retained Earnings 175,000 125,000 113,000 \$725,000 \$600,000 \$533,000 JERNIGAN CORPORATION Income Statement For the Year Ended December 31 2014 2013 Sales revenue \$740,000 \$600,000 Less: Sales return and allowances 40,000 30,000 Net sales 700,000 570,000 Cost of goods sold 425,000 350,000 Gross profit 275,000 220,000 Operating expenses (including income taxes) 180,000 150,000 Net income 95,000 70,000 Additional information: 1. The market price of Jernigan's common stock was \$7.00, \$7.50, and \$8.50 for 2012, 2013, and 2014, respectively. 2. Instructions (a) Compute the following ratios for 2013 and 2014. (1)  Profit margin. 5. Price-earnings ratio. (2)  Gross profit rate. 6. Payout ratio. (3)  Asset turnover. 7. Debt to assets ratio. (4)  Earnings pershare. (b) Based on the ratios calculated, discuss briefly the improvement or lack thereof in the financial position and operating results from 2013 to 2014 of Jernigan Corporation. NOTE:  Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" . (a)(1) Profitmargin 2014 2013 Net income Net sales Profit margin ? ? (a)(2) Gross profitrate 2014 2013 Gross profit Net sales Gross profit rate ? ? (a)(3) Assetturnover 2014 2013 Total assets, 2014 Value Total assets, 2013 Value Value Total assets, 2012 Value Average total assets ? ? 2014 2013 Netsales Value Value Average total assets Value Value Asset turnover ? ? (a)(4) Earnings per share 2014 2013 Common shares outstanding, 2014 Value Common shares outstanding,2013 Value Value Common shares outstanding, 2012 Value Average common shares outstanding ? ? 2014 2013 Net income - Pfd. Dividends Value Value Average common shares outstanding Value Value Earnings pershare ? ? (a)(5) Price-earnings ratio 2014 2013 Stock price per share Value Value Earnings per share Value Value Price-earningsratio ? ? (a)(6) Payout ratio 2014 2013 Prior year's retained earnings Value Value Plus: current year net income Value Value Less: current year's retained earnings Value Value Cash dividendsdeclared ? ? 2014 2013 Cash dividends declared (common) Value Value Net income Value Value Payout ratio ? ? (a)(7) Debt to assetsratio 2014 2013 Current Liabilities Value Long-term debt Value Value Total liabilities ? ? Total assets Value Value Debt to assets ratio ? ?

 E13-4   Prepare vertical analysis Operating data for Jacobs Corporation are presented below. 2014 2013 Salesrevenue \$800,000 \$600,000 Cost of goods sold 520,000 408,000 Selling expenses 120,000 72,000 Administrative expenses 60,000 48,000 Income tax expense 30,000 24,000 Netincome 70,000 48,000 Instructions Prepare a schedule showing a vertical analysis for 2014 and 2013. NOTE:  Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?". JACOBS CORPORATION Condensed Income Statement For the Years Ended December31 2014 2013 Amount Percent Amount Percent Sales Revenue ? ? Cost of goods sold ? ? Grossprofit ? ? Selling expenses ? ? Administrative expenses ? ? Total operating expenses ? ? Income before income taxes ? ? ? ? Income taxexpense ? ? Net income ? ?

 E13-3   Prepare horizontal analysis Here is financial information for Spangles,Inc. December 31, 2014 December 31, 2013 Current assets \$106,000 \$90,000 Plant assets (net) 400,000 350,000 Current liabilities 99,000 65,000 Long-termliabilities 122,000 90,000 Common stock, \$1 par 130,000 115,000 Reained earnings 155,000 170,000 Instructions Prepare a schedule showing a horizontal analysis for 2014, using 2013 as the base year. NOTE:  Enter a number in cellsrequesting a value; enter either a number or a formula in cells with a "?" . Increase or (Decrease) 2014 2013 Amount Percentage Assets Currentassets ? Plant assets (net) ? Total assets ? Liabilities Current liabilities ? Long-term liabilities ? Totalliabilities ? Stockholders' equity Common stock, \$1 par ? Retained earnings ? Total stockholders' equity ? Total liabilities and stockholders' equity ?

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