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Debt ratio at end of Year 2

A company’s cost of goods sold exceeded its cost of finished goods manufactured, and its cost of finished goods manufactured exceeded the total manufacturing costs incurred during the year.  Based on this information, how did the company’s work-in-process and finished goods inventories change during the year?

Hokie Industries produces a single product. The selling price is $60 per unit, and variable costs amount to $42 per unit.  The company’s fixed costs per month total $90,000. What is the contribution margin ratio of Hokie’s product?

The finished goods inventory on March 1st (beginning) must have been

For each of the following transactions, give the appropriate accounts that would be debited or credited, as requested. I show the possible answers below. In some transactions, I have given you some of the information. Transaction Account debited Account credited Issued Preferred Stock at par value. [debit1] [credit1] Declared cash dividends on Common Stock. [debit2] [credit2] Paid the cash dividend declared above (see previous entry). [debit3] [credit3] Declared a small stock dividend on the Common Stock when the market price of the Common Stock is greater than the par value [debit4] APIC and [credit4] Issued Common Stock to distribute the stock dividend (see previous entry) [debit5] [credit5] Purchased Treasury Stock at the current market price. [debit6] [credit6] Reissued Treasury Stock at a price higher than the cost of the Treasury Stock. Note: The Cash account is the debit; you are giving me the two accounts credited. Cash [credit7a] [credit7b] Issued Bonds Payable at a discount. Note: The Bonds Payable account is credited; you are giving me the two accounts debited. [Debit8a] [Debit8b] Bonds Payable    

TWM Corporation has outstanding 50,000 shares of $1 par value common stock as well as 10,000 shares of 6%, $100 par value cumulative preferred stock. At the beginning of the year, the balance in retained earnings was $500,000, and two year’s preferred dividends were in arrears. Net income for the current year is $260,000. Compute the balance in retained earnings at the end of the year if TWM Corporation pays a dividend of $2 per share on its common stock this year.

The total amount of inventory that should appear in the company’s balance sheet at September 30 is

Price Earnings ratio for Year 2

Management expects total sales of $30 million, a margin of safety of $10 million, and a contribution margin ratio of 40%.  The company’s total fixed costs are