(Financial statements) For the year ended December 31, Dutch Retail, Inc., recorded the
items listed here. Prepare an income statement for the year ended December 31 for Dutch
Retail, Inc. Please use an appropriate format, such as the one in Table 3-2.
Cost of goods sold $200
Interest expense 100
Preferred dividends paid 50
Common dividends paid 100
Selling expenses 65
Administrative expenses 100
Depreciation expense 150
Sales revenues 900
Taxes = 40% of taxable income
Table 3-2 LATEST PREVIOUS
YEAR YEAR
Sales $546.9 $485.8
Cost of goods sold 286.3 247.3
Gross profit $260.6 $238.5
Selling, general & administrative exp. 186.2 180.5
Depreciation & amortization 22.7 20.1
Earnings before interest and taxes (EBIT) $ 51.7 $ 37.9
Interest expense 7.7 8.0
Earnings before tax $ 44.0 $ 29.9
Total income tax 18.1 11.9
Net income $ 25.9 $ 18.0
Preferred dividends 1.0 1.0
Net income available for common $ 24.9 $ 17.0
Dividends on common stock 4.5 3.6
Addition to retained earnings $ 20.4 $ 13.4
Per-share data:
Earnings per share $ 2.77 $ 1.89
Dividends per share $ 0.50 $ 0.40
Shares outstanding (millions) 9.000 9.000
4.(Financial statements) Construct a balance sheet for Falken Computers, Inc., from the following
data. Use a format similar to the balance sheet in Table 3-1. What is stockholders' equity?
Cash $500
Inventory 100
Accounts receivable 300
Fixed assets 700
Accounts payable 300
Accrued expenses 100
Long-term debt 500
Table 3-1 LATEST PREVIOUS LATEST PREVIOUS
YEAR YEAR YEAR YEAR
ASSETS LIABILITIES & STOCKHOLDERS' EQUITY
Cash and equivalents $ 9.5 $ 12.0 Accounts payable $ 18.8 $ 14.7
Accounts receivable 233.2 203.3 Notes payable 66.2 33.2
Inventories 133.9 118.8 Accrued expenses 77.7 62.0
Total current assets $376.6 $334.1 Total current liabilities $162.7 $109.9
Net plant and equipment 203.8 167.0 Long-term bonds 74.4 70.2
Total assets $580.4 $501.1 Other long-term liabilities 19.6 17.7
Total liabilities $256.7 $197.8
Preferred stock 10.0 10.0
Common stock 45.4 45.4
Retained earnings 268.3 247.9
Total common equity $323.7 $303.3
Liabilities and stockholders' equity $580.4 $501.1
5.(Financial statements) For the year, Pennsylvania Construction has a cash flow from
operating activities of $1,000,000, a cash flow from investing activities of -$600,000,
and a cash flow from financing activities of -$200,000. If Pennsylvania Construction
has a beginning cash balance for the year of $500,000, what is the company's ending
cash balance?
6.(Financial statements) Ivan Brick Company earned net income after taxes of $850,000 during
the latest year. Retained earnings on its balance sheet equaled $1,740,000 on December
31, last year and $2,040,000 on December 31, the latest year. What cash dividends did
Ivan Brick Company pay during the latest year?
