Posts: 145
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10 months ago
Dahn Corporation has provided the following financial data: Balance Sheet | December 31, Year 2 and Year 1 | | Year 2 | Year 1 |
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Assets | | |
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Current assets: | | |
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Cash | $ 227,000 | $ 150,000 |
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Accounts receivable, net | 134,000 | 130,000 |
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Inventory | 150,000 | 130,000 |
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Prepaid expenses | 83,000 | 80,000 |
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Total current assets | 594,000 | 490,000 |
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Plant & equipment, net | 769,000 | 840,000 |
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Total assets | $ 1,363,000 | $ 1,330,000 |
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Liabilities and Stockholders' Equity | | |
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Current liabilities: | | |
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Accounts payable | $ 200,000 | $ 180,000 |
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Accrued liabilities | 63,000 | 70,000 |
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Notes payable, short term | 71,000 | 60,000 |
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Total current liabilities | 334,000 | 310,000 |
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Bonds payable | 290,000 | 290,000 |
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Total liabilities | 624,000 | 600,000 |
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Stockholders’ equity: | | |
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Common stock, $5 par value | 400,000 | 400,000 |
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Additional paid-in capital | 50,000 | 50,000 |
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Retained earnings | 289,000 | 280,000 |
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Total stockholders’ equity | 739,000 | 730,000 |
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Total liabilities & stockholders’ equity | $ 1,363,000 | $ 1,330,000 |
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Income Statement | For the Year Ended December 31, Year 2 | Sales (all on account) | $ 1,370,000 |
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Cost of goods sold | 850,000 |
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Gross margin | 520,000 |
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Operating expenses | 482,692 |
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Net operating income | 37,308 |
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Interest expense | 21,000 |
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Net income before taxes | 16,308 |
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Income taxes (35%) | 5,708 |
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Net income | $ 10,600 |
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Dividends on common stock during Year 2 totaled $1,600. The market price of common stock at the end of Year 2 was $2.37 per share. The company’s average collection period for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.) ▸ 35.7 days ▸ 1.1 days ▸ 1.0 days ▸ 35.2 days
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