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    The document provides financial information for Masagana Gas Corporation for the year ended December 31, 2000 including adjusted account balances, income statement figures, and key financial metrics. It analyzes the company's liquidity, asset management, debt management, and profitability. Key metrics included a current ratio of 6.77, accounts receivable turnover of 8.51, inventory turnover of 5.89, gross margin percentage of 44%, and return on equity of 4.24%.

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    The document provides financial information for Masagana Gas Corporation for the year ended December 31, 2000 including adjusted account balances, income statement figures, and key financial metrics. It analyzes the company's liquidity, asset management, debt management, and profitability. Key metrics included a current ratio of 6.77, accounts receivable turnover of 8.51, inventory turnover of 5.89, gross margin percentage of 44%, and return on equity of 4.24%.

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    The document provides financial information for Masagana Gas Corporation for the year ended December 31, 2000 including adjusted account balances, income statement figures, and key financial metrics. It analyzes the company's liquidity, asset management, debt management, and profitability. Key metrics included a current ratio of 6.77, accounts receivable turnover of 8.51, inventory turnover of 5.89, gross margin percentage of 44%, and return on equity of 4.24%.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    161 views8 pages

    S

    Uploaded by

    debate dd
    The document provides financial information for Masagana Gas Corporation for the year ended December 31, 2000 including adjusted account balances, income statement figures, and key financial metrics. It analyzes the company's liquidity, asset management, debt management, and profitability. Key metrics included a current ratio of 6.77, accounts receivable turnover of 8.51, inventory turnover of 5.89, gross margin percentage of 44%, and return on equity of 4.24%.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 8

    Financial Anaysis

    Account balances of Masagana Gas Corporation for year ended


    December 31, 2000 Adjustments
    Cash 200000 12000
    Accounts Receivable 250000
    Inventory, January 1, 2000 150000 150000 230000
    Land 300000
    Building 1000000
    Accumulated Depreciation- Building 200000 50000
    Equipment 400000
    Accumulated Depreciation - Equipment 40000 40000

    Accounts Payable 100000


    Capital Stock 1845000
    Sales 2000000
    Purchases 1200000
    Office Expenses 255000
    Rent 240000 10000
    Insurance 50000
    Supplies Expenses 140000

    Doubtful Accounts Expense 15000


    Allowance for doubtful Accounts 15000
    Depreciation Expense 90000
    Accrued Rent Expense 10000
    Prepaid Insurance 12000
    Income statement
    Sales 2000000
    Inventory, January 1, 2000 150000
    Purchases 1200000
    Total Goods Available for sale 1350000
    Inventory, December 31, 2000 -230000
    Cost of goods sold 1120000 1120000
    Gross profit 880000
    Other operating expenses
    Office Expenses 255000
    Rent 250000
    Insurance 50000
    Supplies Expenses 140000
    Doubtful Accounts Expense 15000
    Depreciation Expense 90000
    Total Operating Expenses 800000 800000
    Net Income 80000
    Financial Anaysis
    Adjusted accounts for dec 2000
    Cash 268000
    Accounts Receivable 250000
    Allowance for doubtful Accounts 15000
    Inventory 230000
    Prepaid Insurance 12000
    Land 300000
    Building 1000000
    Accumulated Depreciation- Building 250000
    Equipment 400000
    Accumulated Depreciation - Equipment 80000 2460000
    345000
    Accounts Payable 100000 2115000
    Accrued Rent Expense 10000
    Capital Stock 1925000
    Liquidity
    Working Capital
    Current assets - Current Liabilities
    Cash 268000
    Net Accounts Receivable 235000
    Inventory, January 1, 2000 230000
    Prepaid Insurance 12000
    Total Current Assets 745000 745000

    Accounts Payable 100000


    Accrued Rent Expense 10000
    Total Current Liabilities 110000 110000
    Working Capital 635000

    Current Ratio
    Current assets / Current Liabilities
    Total Current Assets 745000
    Total Current Liabilities 110000
    Current Ratio 6.772727

    Acid-test Ratio
    Cash 268000
    Net Accounts Receivable 235000
    Total Quick assets 503000 503000
    Total Current Liabilities 110000
    Acid-test Ratio 4.572727

    Asset Management
    Accounts Receivable Turnover
    Net sales / Average Accounts Receivable
    Net sales 2000000
    Net Accounts Receivable 235000
    Accounts Receivable Turnover 8.510638

    Average Collection Period


    365 days/Accounts receivable turnover
    days 365
    Accounts Receivable Turnover 8.510638
    Average Collection Period 42.8875

    Inventory turnover
    Cost of Goods sold/average inventory balance

    Inventory Beg 150000


    Inventory end 230000
    total 380000
    divided by 2 2
    average inventory balance 190000

    Cost of goods solds 1120000


    average inventory balance 190000
    Inventory turnover 5.894737

    Average Sale Period


    365 days / Inventory turnover
    days 365
    Inventory turnover 5.894737
    Average Sale Period 61.91964

    Operating Cycle
    Average sale period + collection period
    Average Collection Period 42.8875
    Average Sale Period 61.91964
    Operating Cycle 104.8071

    Total assets turnover


    Sales / average total assets
    Total assets beg 2060000
    Total assets end 2115000
    Total assets 4175000
    divided by 2 2
    Average total assets 2087500

    Sales 2000000
    Average total assets 2087500
    Total assets turnover 0.958084

    Debt Management
    Debt to equity Ratio
    Total liabilities / equity
    Total Liabilities 110000
    Capital Stock 1925000
    Debt to equity Ratio 0.057143

    Equity Multiplier
    Ave total assets / Ave Equity
    Capital Stock beg 1845000
    Capital Stock end 1925000
    total 3770000
    2 2
    Average Equity 1885000

    Average total assets 2087500


    Average Equity 1885000
    Equity Multiplier 1.107427

    Profitability
    Gross Margin Percentage
    Gross profit / Sales
    Gross profit 880000
    Sales 2000000
    Gross Margin Percentage 0.44

    Net Profit Margin Percentage


    Net Income / Sales
    Net Income 80000
    Sales 2000000
    Gross Margin Percentage 0.04

    Return on Equity
    Net income / Average Equity
    Net income 80000
    Average Equity 1885000
    Return on Equity 0.04244

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