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Posts: 143
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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 operating cycle for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.) ▸ 66.2 days ▸ 16.5 days ▸ 95.3 days ▸ 45.6 days
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