Exercise 12-11 Matthias Medical manufactures hospital beds and


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Mar 29, 2016. Exercise 12-11 Matthias Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income statement for 2012 and 2013 follow. Matthias Medical Comparative Balance Sheet As of December 31 2013 2012 Assets Current assets Cash $373,000 $417,400 Accounts receivable, net 1,065,900 776,500 Inventory 748,000 681,000 Other current assets 396,000 247,100 Total current assets 2,582,900 2,122,000 Property, plant, & equipment, net 8,977,605 8,484,895 Total assets $11,560,505 $10,606,895 Liabilities and Stockholders’ Equity Current liabilities $3,198,000 $2,846,100 Long-term debt 3,702,600 3,892,650 Total liabilities 6,900,600 6,738,750 Preferred stock, $5 par value 57,100 57,100 Common stock, $0.25 par value 100,000 103,900 Retained earnings 4,502,805 3,707,145 Total stockholders’ equity 4,659,905 3,868,145 Total liabilities and stockholders’ equity $11,560,505 $10,606,895 Matthias Medical Comparative Income Statement and Statement of Retained Earnings For the Year 2013 2012 Sales revenue (all on account) $10,580,000 $9,613,950 Cost of goods sold 5,579,000 5,298,750 Gross profit 5,001,000 4,315,200 Operating expenses 2,840,200 2,634,150 Net operating income 2,160,800 1,681,050 Interest expense 392,000 308,700 Net income before taxes 1,768,800 1,372,350 Income taxes (30%) 530,640 411,705 Net income $1,238,160 $960,645 Dividends paid Preferred dividends 29,500 29,500 Common dividends 413,000 417,000 Total dividends paid 442,500 446,500 Net income retained 795,660 514,145 Retained earnings, beginning of year 3,707,145 3,193,000 Retained earnings, end of year $4,502,805 $3,707,145 Calculate the earnings per share (average of 417,000 shares outstanding for the year) for 2013. (Round answer to 2 decimal places, e.g. 2.55.) Earning per share $ per share Calculate the price/earnings ratio (market price of $45 at year-end) for 2013. (Round answer to 2 decimal places, e.g. 2.55.) Price/earnings ratio Calculate the dividend payout ratio (dividends of $1.04 per common share for the year) for 2013. (Round answer to 2 decimal places, e.g. 2.55%.) Dividend payout ratio % AB258
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