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Accounting homework help

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1. Calculate the profit margin ratio based on the following information:

1.  Calculate the profit margin ratio based on the following information:

CASH:  $14,870

ACCOUNTS RECEIVABLE:  $22,108

PREPAID $3,010

SUPPLIES: $927

EQUIPMENT:  $62,150

ACCUMULATED DEPRECIATION:  $13,750

ACCOUNTS PAYABLE $28,000

NET SALES:  $325,000

INTEREST EXPENSE:  $6,000

TAX EXPENSE:  $12,600

EARNINGS BEFORE INTEREST AND TAXES:  $122,623

NUMBER OF SHARES OUTSTANDING 335,000 

 

Round to two decimals

 

 

acc/291

acc/291 principle of accounting 2

Luemas Corporation

1)   Luemas Corporation recently reported the following income statement for 2004 (numbers are in millions of dollars): Sales $12,500 Total operating costs 5,700 EBIT $6,800 Interest 150 Earnings before tax (EBT) $6,650 Taxes (40%) 2,660 Net income available to common shareholders $3,990 The company forecasts that its sales will increase by 8 percent in 2005 and its operating costs will increase in proportion to sales. The company's interest expense is expected to remain at $150 million, and the tax rate will remain at 40 percent.

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