The comparative statements of Lucille Company are presented here.

P13-2A The comparative statements of Lucille Company are presented here.

LUCILLE COMPANY

Income Statements

For the Years Ended December 31

Year 2012 2011

Net sales $1,890,540 (2012 year) $1,750,500 (2011 year)

Cost of goods sold 1,058,540 (2012 year) 1,006,000 (2011 year)

Gross profit 832,000 (2012 year) 744,500 (2011 year)

Selling and administrative expenses 500,000 (2012 year) 479,000 (2011 year)

Income from operations 332,000 (2012 year) 265,500 (2011 year)

Other expenses and losses Interest expense 22,000 (2012 year) 20,000 (2011 year)

Income before income taxes 310,000 (2012 year) 245,500 (2011 year)

Income tax expense 92,000 (2012 year) 73,000 (2011 year)

Net income $ 218,000 (2012 year) $ 172,500 (2011 year)

Compute ratios from balance sheets and income statements. (SO 6), AP

LUCILLE COMPANY

Balance Sheets

December 31

Assets for the years 2012 & 2011

Current assets - - - -

Cash $ 60,100 (2012 year) $ 64,200 (2011 year)

Short-term investments 4,000 (2012 year) 50,000 (2011 year)

Accounts receivable 117,800 (2012 year) 102,800 (2011 year)

Inventory 126,000 (2012 year) 115,500 (2011 year)

Total current assets 377,900 (2012 year) 332,500 (2011 year)

Plant assets (net) 649,000 (2012 year) 520,300 (2011 year)

Total assets $1,026,900 (2012 year) $852,800 (2011 year)

Liabilities and Stockholders’ Equity

Current liabilities

Accounts payable $ 160,000 (2012 year) $145,400 (2011 year)

Income taxes payable 43,500 (2012 year) 42,000 (2011 year)

Total current liabilities 203,500 (2012 year) 187,400 (2011 year)

Bonds payable 220,000 (2012 year) 200,000 (2011 year)

Total liabilities 423,500 (2012 year) 387,400 (2011 year)

Stockholders’ equity

Common stock ($5 par) 290,000 (2012 year) 300,000 (2011 year)

Retained earnings 313,400 (2012 year) 165,400 (2011 year)

Total stockholders’ equity 603,400 (2012 year) 465,400 (2011 year)

Total liabilities and stockholders’ equity $1,026,900 (2012 year) $852,800 (2011 year)

All sales were on account. Net cash provided by operating activities for 2012 was $220,000. Capital expenditures were $136,000, and cash dividends were $70,000.

Instructions
Compute the following ratios for 2012.

A. Earnings per share.

B. Return on common stockholders’ equity.

C. Return on assets.

D. Current ratio.

E. Receivables turnover.

F. Average collection period.

G. Inventory turnover

H. Days in inventory.

I. Times interest earned.

J. Asset turnover.

K. Debt to total assets.

L. Current cash debt coverage.

M. Cash debt coverage.

N. Free cash flow.