Question_2Using_these_data_from_the_comparative_balance_sheet_of

Question 2

Using these data from the comparative balance sheet of Rosalez Company, perform vertical analysis. (Round percentages to 1 decimal place, e.g. 12.5%.)

	Dec. 31, 2012	Dec. 31, 2011
	Amount	Percentage		Amount		Percentage
Accounts receivable	$ 566,400		%		$ 372,800		%
Inventory	$ 767,100		%		$ 607,800		%
Total assets	$3,124,300		%		$2,840,100		%

Question 3

Vertical analysis (common-size) percentages for Vallejo Company’s sales, cost of goods sold, and expenses are listed here.

Vertical Analysis	2012		2011		2010
Sales	100	%		100	%	100	%
Cost of goods sold	61.3			64.2		65.2
Expenses	24.1			27.7		28.4

Did Vallejo’s net income as a percent of sales increase, decrease, or remain unchanged over the 3-year period? Provide numerical support for your answer.

Question 4

Horizontal analysis (trend analysis) percentages for Spartan Company’s sales, cost of goods sold, and expenses are listed here.

Horizontal Analysis	2012		2011		2010
Sales	96.2	%		104.8	%	100.0	%
Cost of goods sold	101.0			98.0		100.0
Expenses	105.6			95.4		100.0

Explain whether Spartan’s net income increased, decreased, or remained unchanged over the 3-year period.

Question 5

These selected condensed data are taken from recent balance sheets of Bob Evans Farms (in thousands).

	2009	2008
Cash	$ 13,606	$ 7,669
Accounts receivable	23,045	19,951
Inventories	31,087	31,345
Other current assets	12,522	11,909
Total current assets	$ 80,260	$ 70,874
Total current liabilities	$245,805	$326,203

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Compute the current ratio for each year. (Round answers to 2 decimal places, e.g. .12 : 1.)

		2009		2008
Current ratio:		3.06	:1		4.6	:1

Question 6

Staples, Inc. is one of the largest suppliers of office products in the United States. It had net income of $738.7 million and sales of $24,275.5 million in 2009. Its total assets were $13,073.1 million at the beginning of the year and $13,717.3 million at the end of the year. What is Staples, Inc.’s asset turnover ratio and profit margin ratio? (Round answers to 2 decimal places, e.g. 1.25 or 2.05%.)

Asset turnover ratio			times
Profit margin ratio			%

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Question 7

Selected data taken from a recent year’s financial statements of trading card company Topps Company, Inc. are as follows (in millions).

Net sales		$326.7
Current liabilities, beginning of year		41.1
Current liabilities, end of year		62.4
Net cash provided by operating activities		10.4
Total liabilities, beginning of year		65.2
Total liabilities, end of year		73.2
Capital expenditures		3.7
Cash dividends		6.2

Compute these ratios: current cash debt coverage ratio, cash debt coverage ratio, and free cash flow. Provide a brief interpretation of your results. (Round answers to 2 decimal places, e.g. 0.12.)

Current cash debt coverage ratio		times
Cash debt coverage ratio		times
Free Cash Flow	$	millions

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