Chapter 13 Homework

Utech Company has income before irregular items of $345,800 for the year ended December 31, 2014. It also has the following items (before considering income taxes): (1) an extraordinary fire loss of $48,900 and (2) a gain of $29,100 from the disposal of a division. Assume all items are subject to income taxes at a 24% tax rate.
Prepare Utech Company’s income statement for 2014, beginning with “Income before irregular items.”

Suppose the comparative balance sheets of Nike, Inc. are presented here.NIKE, INC.Condensed Balance SheetMay 31($ in millions)  2014 2013Assets    Current Assets $9,557 $8,724Property, plant, and equipment (net) 1,827 1,765Other assets 1,513 1,669Total assets $12,897 $12,158Liabilities and Stockholders’ Equity    Current Liabilities $3,176 $3,227Long-term liabilities 1,250 1,279Stockholders’ equity 8,471 7,652Total liabilities and stockholders’ equity $12,897 $12,158(a) Prepare a horizontal analysis of the balance sheet data for Nike, using 2013 as a base. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 1 decimal place, e.g. 12.1%.)NIKE, INC.Condensed Balance SheetMay 31($ in millions)  2014 2013 Increase(Decrease) PercentageChangefrom 2013Assets            Current Assets $9,557 $8,724 $[removed] [removed]%   Property, plant, and equipment (net) 1,827 1,765 [removed] [removed]%   Other assets 1,513 1,669 [removed] [removed]%   Total assets $12,897 $12,158 $[removed] [removed]%Liabilities and Stockholders’ Equity            Current Liabilities $3,176 $3,227 $[removed] [removed]%   Long-term liabilities 1,250 1,279 [removed] [removed]%   Stockholders’ equity 8,471 7,652 [removed] [removed]%   Total liabilities and stockholders’ equity $12,897 $12,158 $[removed] [removed]%(b) Prepare a vertical analysis of the balance sheet data for Nike for 2014.NIKE, INC.Condensed Balance SheetMay 31, 2014  $ (in millions) PercentAssets        Current Assets $9,557 [removed]%   Property, plant, and equipment (net) 1,827 [removed]%   Other assets 1,513 [removed]%Total assets $12,897 [removed]%Liabilities and Stockholders’ Equity        Current Liabilities $3,176 [removed]%   Long-term Liabilities 1,250 [removed]%   Stockholders’ equity 8,471 [removed]%Total liabilities and stockholders’ equity $12,897 [removed]%   Exercise 13-6Here are the comparative income statements of Eudaley Corporation.EUDALEY CORPORATIONComparative Income StatementFor the Years Ended December 31       2014 2013Net sales $623,280 $526,140Cost of goods sold 458,190 399,970Gross Profit 165,090 126,170Operating expenses 74,840 41,110Net income $ 90,250 $ 85,060  Prepare a horizontal analysis of the income statement data for Eudaley Corporation, using 2013 as a base. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 1 decimal place, e.g. 12.1%.)EUDALEY CORPORATIONComparative Income StatementFor the Years Ended December 31     Increase or (Decrease) During 2014 2014 2013 Amount PercentageNet sales$623,280 $526,140 $[removed] [removed]%Cost of goods sold458,190 399,970 [removed] [removed]%Gross Profit165,090 126,170 [removed] [removed]%Operating expenses74,840 41,110 [removed] [removed]%Net income$ 90,250 $ 85,060 $[removed] [removed]%  LINK TO TEXTLINK TO VIDEOPrepare a vertical analysis of the income statement data for Eudaley Corporation for both years. (Round percentages to 1 decimal place, e.g. 12.1%.)EUDALEY CORPORATIONComparative Income StatementsFor the Years Ended December 31 2014 2013 $ Percent $ PercentNet sales$623,280 [removed]% $526,140 [removed]%Cost of goods sold458,190 [removed]% 399,970 [removed]%Gross Profit165,090 [removed]% 126,170 [removed]%Operating expenses74,840 [removed]% 41,110 [removed]%Net income$ 90,250 [removed]% $ 85,060 [removed]%    Exercise 13-11Here is the income statement for Eberle, Inc.EBERLE, INC.Income StatementFor the Year Ended December 31, 2014Sales revenue $441,600Cost of goods sold 207,300Gross profit 234,300Expenses (including $12,500 interest and $23,500 income taxes) 89,900Net income $ 144,400Additional information:1. Common stock outstanding January 1, 2014, was 22,400 shares, and 39,200 shares were outstanding at December 31, 2014.2. The market price of Eberle, Inc., stock was $13 in 2014.3. Cash dividends of $19,000 were paid, $6,800 of which were to preferred stockholders.Compute the following measures for 2014. (Round all answers to 2 decimal places, e.g. 1.83 or 2.51%)(a) Earnings per share $[removed] (b) Price-earnings ratio [removed] times(c) Payout ratio [removed] %(d) Times interest earned [removed] times   Problem 13-5ASuppose selected financial data of Target and Wal-Mart for 2014 are presented here (in millions).  TargetCorporation Wal-MartStores, Inc.  Income Statement Data for YearNet sales $65,038  $410,365 Cost of goods sold 45,990  307,684 Selling and administrative expenses 15,224  75,219 Interest expense 660  1,920 Other income (expense) (71) (380)Income tax expense 1,308  6,733 Net income $ 1,785  $ 18,429          Balance Sheet Data(End of Year)Current assets $17,269  $45,356 Noncurrent assets 25,578  122,848 Total assets $42,847  $168,204 Current liabilities $10,937  $55,219 Long-term debt 18,294  43,370 Total stockholders’ equity 13,616  69,615 Total liabilities and stockholders’ equity $42,847  $168,204          Beginning-of-Year BalancesTotal assets $44,595  $163,195 Total stockholders’ equity 13,924  65,043 Current liabilities 10,224  54,308 Total liabilities 30,671  98,152          Other DataAverage net accounts receivable $7,454  $3,882 Average inventory 6,855  33,975 Net cash provided by operating activities 5,574  26,667 Capital expenditures 1,773  12,167 Dividends 468  4,358 (a) For each company, compute the following ratios. (Round all answers to 2 decimal places, e.g. 1.83 or 12.61%.)    Target Wal-Mart(1) Current ratio. [removed] :1 [removed] :1(2) Accounts receivable turnover. [removed] times [removed] times(3) Average collection period. [removed] days [removed] days(4) Inventory turnover. [removed] times [removed] times(5) Days in inventory. [removed] days [removed] days(6) Profit margin. [removed] % [removed] %(7) Asset turnover. [removed] times [removed] times(8) Return on assets. [removed] % [removed] %(9) Return on common stockholders’ equity. [removed] % [removed] %(10) Debt to assets ratio. [removed] % [removed] %(11) Times interest earned. [removed] times [removed] times(12) Current cash debt coverage. [removed] times [removed] times(13) Cash debt coverage. [removed] times [removed] times(14) Free cash flow. $[removed]  $[removed]