Final Exam Westward Corporation

| December 2, 2017

The condensed financial statements of Westward Corporation for 2009 and 2008 are presented below.Westward Corporation Westward CorporationBalance Sheet Income StatementDecember 31, 2009 For the Year Ended December 31, 2009Assets Revenues $2,000,000Current assets ExpensesCash and temporary Cost of goods sold 1,080,000investments $ 30,000 Selling and administrativeAccounts receivable 70,000 expenses 495,000Inventories 120,000 Interest expense 30,000Total current assets 220,000 Total expenses 1,605,000Property, plant, and Income before income taxes 395,000equipment (net) 780,000 Income tax expense 140,000Total assets $1,000,000 Net income $ 255,000Liabilities and Stockholders’ EquityCurrent liabilities $ 80,000Long-term liabilities 300,000Common stockholders’ equity 620,000Total liabilities andstockholders’ equity $1,000,000Westward Corporation Westward CorporationBalance Sheet Income StatementDecember 31, 2008 For the Year Ended December 31, 2008Assets Revenues $2,500,000Current assets ExpensesCash and temporary Cost of goods sold 1,750,000investments $ 40,000 Selling and administrativeAccounts receivable 90,000 expenses 500,000Inventories 150,000 Interest expense 30,000Total current assets 280,000 Total expenses 2,280,000Property, plant, and Income before income taxes 220,000equipment (net) 800,000 Income tax expense 77,000Total assets $1,080,000 Net income $ 143,000Liabilities and Stockholders’ EquityCurrent liabilities $ 140,000Long-term liabilities 320,000Common stockholders’ equity 620,000Total liabilities andstockholders’ equity $1,080,000Select data from fiscal year 2007:Inventory: $100,000Total assets: $900,000Stockholders Equity: $540,000InstructionsCompute the following listed ratios for 2009 and 2008 showing supporting calculations. (5.2 points)Current ratioDebt to total AssetsTimes interest earnedInventory turnoverProfit margin ratioReturn on common stockholders’ equityReturn on assetsPerform horizontal and vertical analysis on Westward s financial statements, show your results. (3.0 points)Assess the financial performance of Westward, given the analysis tools used in questions 1 and 2 above. (5.3 points)If the company wanted to perform industry comparison analysis, what references would you recommend it use? (1.5 points)

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