Part -1:
Thomas Corporation began business by issuing $2,000 of common stock on January 1, 2012. The business performed $8,000 of service on account in 2012 and collected $6,000 of this amount by year end. It paid operating expenses of $4,500 and paid a $500 dividend to stockholders.
Required:
a) What is the amount of total assets at the end of 2012?
b) What is the amount of cash on hand at the end of 2012?
c) What is the net income for 2012?
d) Prepare a balance sheet for 2012.
Part -2
The following is a list of selected events for Unger Sales and Service for 2012. Unger uses a perpetual inventory system and had a zero inventory balance prior to these transactions.
1) Purchased merchandise on account for $67,000.
2) Sold inventory costing $48,000 for $88,000 on account.
3) Paid transportation-out cost of $1,000 on goods sold.
4) Paid salary expense of $25,000.
5) A count of the inventory revealed that there was $18,500 of inventory on hand at the end of 2010.
Required:
Answer the following questions based on the above information.
a) What was Unger's net income for 2012?
b) Compute gross margin and the gross margin percent for 2012.
c) What amount of inventory will appear on the balance sheet for 2012?
d) Prepare an income statement for 2012.
Part -3:
On November 30, 2012, Chee Company's bank statement showed an ending balance of $16,841. The following information is available about Chee's account:
1. Debit memo in bank statement for bank service charge, $39
2. Deposit in transit, $1,988
3. Outstanding checks, $2,156
4. Customer's NSF check for $723 was returned with the bank statement
Required:
a) Determine the true cash balance as of November 30, 2012
b) Determine the unadjusted balance of the company's Cash account as of November 30, 2012.
Part -4:
During 2012, the Hartnett Corporation and the Chapel Corporation reported net incomes of $100,000 and $250,000 respectively. Both companies had 200,000 shares of common stock issued and outstanding. At December 31, 2012, the market price per share of Hartnett's stock was $31 and Chapel's' stock was $35.
Required:
a) Calculate the price-earnings ratio for each company. (Use two decimal places for earnings per share calculation. Then show P/E ratio as a whole number.)
b) Based on the price-earnings ratios computed in part (a), which company do investors believe has more potential for future income growth? State your reason.
Part -5:
For 2012, Stull Corporation reported after-tax net income of $1,100,000. During the year, the number of outstanding shares of 6% $100 par preferred stock remained constant at 5,000, and 500,000 shares of common stock were outstanding all year. The company's total stockholders' equity at December 31, 2012, was $10,500,000. Stull's common stock was selling at $38 per share at the end of the year. All dividends for the year were paid, including a dividend of $1.50 per share to common stockholders.
Required:
Compute the following:
a) Earnings per share (round to two decimals)
b) Book value per share of common stock (show as whole dollar)
c) Price-earnings ratio (round to one decimal)
d) Dividend yield (round to one decimal)