P23-3A
five inc and six inc
Cost of Goods Sold 505,000 350,000
Gross profit 290,000 300,000
Operating Expenses 169,500 125,000
Interest Expense 10,000 -
Net income before income taxes 110,500 175,000
Income tax 27,625 43,750
Net income after income taxes $82,875 $131,250
Property, Plant, and Equipment(net) 225,000 196,000
Total Assets $350,000 $300,900
Current liabilities $98,500 $79,800
Total long Term Liabilities(bonds payable) 100,000 -
Total Liabilities 198,500 79,800
Retained Earnings 131,500 201,100
Total Stockholders’ Equity 151,500 221,100
Total Liabilities and Stockholders’ Equity $350,000 $300,900
TUTORIAL PREVIEW
FIVE, INC. and SIX, INC.
Financial Ratios
File name: P23-3A five inc and six inc.xls File type: xls PRICE: $15
FIVE, INC. and SIX, INC.
Condensed Financial Statements
Income Statements
Year Ended December 31, 2013
Five Inc Six, Inc
Sales9net $795,000 $650,000Cost of Goods Sold 505,000 350,000
Gross profit 290,000 300,000
Operating Expenses 169,500 125,000
Interest Expense 10,000 -
Net income before income taxes 110,500 175,000
Income tax 27,625 43,750
Net income after income taxes $82,875 $131,250
Balance Sheets
December 31, 2013
Assets Five,
Inc Six, Inc.
Current
Assets $125,000 $104,900Property, Plant, and Equipment(net) 225,000 196,000
Total Assets $350,000 $300,900
Liabilities
and Stockholders’ Equity
Liabilities Current liabilities $98,500 $79,800
Total long Term Liabilities(bonds payable) 100,000 -
Total Liabilities 198,500 79,800
Stockholders’
Equity
Common
Stock ($10 par value) 20,000 20,000Retained Earnings 131,500 201,100
Total Stockholders’ Equity 151,500 221,100
Total Liabilities and Stockholders’ Equity $350,000 $300,900
TUTORIAL PREVIEW
FIVE, INC. and SIX, INC.
Financial Ratios
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Five, Inc
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Six, Inc
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Rate
of Return on Net Sale
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Net
income after taxes
Sales
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$82,875
$795,000
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10.42%
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$13,125
$650,000
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=
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2.02%
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Correct!
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Correct!
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