MBA6014 Unit 5 Assignment Problems & Exercises 2015

CP11-2

Finding Financial Information

LO11-1, 11-3, 11-4, 11-6

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Required:
1. How many shares of common stock are authorized at the end of the current year? How many shares are issued and
outstanding at the end of the current year?
shares authorized
shares issued and outstanding
2. Did the company pay dividends during the most recent reporting year? If so, what was the total amount of dividends paid
and how much were they per share?

3. Does the company have any treasury stock? If so, how much?

4. Has the company issued a stock dividend or a stock split over the past three reporting years? If so, describe.

5. Does the company's common stock have a par value? If it does, what is the par value?

CP11-2

Finding Financial Information

LO11-1, 11-3, 11-4, 11-6

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Required:
1. How many shares of common stock are authorized at the end of the current year? How many shares are issued and
outstanding at the end of the current year?
shares authorized
shares issued and outstanding
2. Did the company pay dividends during the most recent reporting year? If so, what was the total amount of dividends paid
and how much were they per share?

3. Does the company have any treasury stock? If so, how much?
The company does not have any Treasury Stock.

4. Has the company issued a stock dividend or a stock split over the past three reporting years? If so, describe.

5. Does the company's common stock have a par value? If it does, what is the par value?

CP13-2

Analyzing Financial Statements

LO13-4, 13-5, 13-6, 13-7

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Compute the following ratios for the most recent reporting year for which you have available information:
Return on equity:
=

Earnings per share:
As reported:
Profit margin:
=

Current ratio:
=

Inventory turnover:
=

Debt/Equity:
=

Price/earnings:
(Assume the stock price is $35.)
=

Dividend yield:

CP13-2

Analyzing Financial Statements

LO13-4, 13-5, 13-6, 13-7

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Compute the following ratios for the most recent reporting year for which you have available information:
Return on equity:
=

Earnings per share:
As reported:
Profit margin:
=

Current ratio:
=

Inventory turnover:
=

Debt/Equity:
=

Price/earnings:
(Assume the stock price is $35.)
=

Dividend yield:

29.2

CP9-2

Finding Financial Information

LO9-1, 9-5, 9-6

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Required:
1. What is the amount of accrued compensation at the end of the most recent reporting year? (Dollars in thousands.)

2. As reported on the Statement of Cash Flows, by what amount did accounts payable, accrued expenses and other current liabilities
change over the most recent reporting year? (Dollars in thousands.)

How did this change affect cash flows from operating activities during the most recent reporting year?

3. What is the amount of long-term liabilities at the end of the most recent reporting year? (Dollars in thousands.)

CP9-2

Finding Financial Information

LO9-1, 9-5, 9-6

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book.
Required:
1. What is the amount of accrued compensation at the end of the most recent reporting year? (Dollars in thousands.)
$

15,630

2. As reported on the Statement of Cash Flows, by what amount did accounts payable, accrued expenses and other current liabilities
change over the most recent reporting year? (Dollars in thousands.)

How did this change affect cash flows from operating activities during the most recent reporting year?

3. What is the amount of long-term liabilities at the end of the most recent reporting year? (Dollars in thousands.)

P11-2 Preparing the Stockholders Equity Section of the Balance Sheet LO11-3, 11-7
Witt Corporation received its charter during January 2014. The charter authorized the following capital stock:
Preferred stock: 10 percent, par $10, authorized 21,000 shares
Common stock: par $8, authorized 50,000 shares.
During 2014, the following transactions occurred in the order given:
a.
b.
c.
d.

Issued a total of 40,000 shares of the common stock to the four organizers at $12 per share.
Sold 5,500 shares of the preferred stock at $16 per share.
Sold 3,000 shares of the common stock at $15 per share and 1,000 shares of the preferred stock at $26.
Net income for the year was $96,000.

Required:
Prepare the Stockholders’ Equity section of the balance sheet at December 31, 2014.
Possible input areas are shaded.
WITT CORPORATION
Balance Sheet (Partial)
At December 31, 2014
Stockholders’ equity:
Contributed capital:

Total contributed capital

Total stockholders’ equity

-

$

-

P11-2 Preparing the Stockholders Equity Section of the Balance Sheet LO11-3, 11-7
Witt Corporation received its charter during January 2014. The charter authorized the following capital stock:
Preferred stock: 10 percent, par $10, authorized 21,000 shares
Common stock: par $8, authorized 50,000 shares.
During 2014, the following transactions occurred in the order given:
a.
b.
c.
d.

Issued a total of 40,000 shares of the common stock to the four organizers at $12 per share.
Sold 5,500 shares of the preferred stock at $16 per share.
Sold 3,000 shares of the common stock at $15 per share and 1,000 shares of the preferred stock at $26.
Net income for the year was $96,000.

Required:
Prepare the Stockholders’ Equity section of the balance sheet at December 31, 2014.
Possible input areas are shaded.
WITT CORPORATION
Balance Sheet (Partial)
At December 31, 2014
Stockholders’ equity:
Contributed capital:

Total contributed capital

Total stockholders’ equity

639,000

E13-5 Matching Each Ratio with Its Computational Formula LO 13-4, 13-5, 13-6, 13-7
Match each definition with its related ratios or percentages by selecting the appropriate letter in the drop down provided.

Definitions:
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
K.
L.
M.
N.
O.
P.
Q.

Ratios or Percentages
Net Income (before extraordinary items) ÷ Net Sales
Days in Year ÷ Receivable Turnover ratio
Net Income ÷ Average Stockholders’ Equity
Net Income ÷ Average Number of Shares of Common Stock Outstanding
Return on Equity ? Return on Assets
Quick Assets ÷ Current Liabilities
Current Assets ÷ Current Liabilities
Cost of Goods Sold ÷ Average Inventory
Net Credit Sales ÷ Average Net Receivables
Days in Year ÷ Inventory Turnover Ratio
Total Liabilities ÷ Stockholders’ Equity
Dividends per Share ÷ Market Price per Share
Market Price per Share ÷ Earnings per Share
[Net Income + Interest Expense (net of tax)] ÷ Average Total Assets
Cash from Operating Activities (before interest and taxes) ÷ Interest Paid
Net Sales Revenue ÷ Net Fixed Assets
(Net Income + Interest Expense + Income Tax Expense) ÷ Interest Expense

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

Profit margin
Inventory turnover ratio
Average collection period
Dividend yield ratio
Return on equity
Current ratio
Debt-to-equity ratio
Price/earnings ratio
Financial leverage percentage
Receivable turnover ratio
Average days’ supply of inventory
Earnings per share
Return on assets
Quick ratio
Times interest earned
Cash coverage ratio
Fixed asset turnover ratio

Definitions

E13-5 Matching Each Ratio with Its Computational Formula LO 13-4, 13-5, 13-6, 13-7
Match each definition with its related ratios or percentages by selecting the appropriate letter in the drop down provided.

Definitions: