question 69
Multiple Choice
Devlin Company
Devlin Company
Statement of Financial Position
as of May 31
(in thousands)
Assets Current assets Cash Trading securities Accounts receivable (net) Inventories Prepaid expenses Total current assets Investments, at equity Property, plant, and equipment (net) Intangible assets (net) Total assets Liabilities and shareholders’ equity Current liabilities Notes payable Accounts payable Accrued expenses Income taxes pavable Total current liabilities Long-term debt Deferred taxes Total liabilities Shareholders’ equity Preferred stock, 6%,$100 par value, cumulative Common stock, $10 par value Additional paid-in capital-common stock Retained earmings Total shareholders’ equity Total liabilities and shareholders’ equity year 7$4530689022$2553837580$748$3570515125353$16315022511496$585$748year 6$3820488030$2163040045$691$184241680352$117150195100129$574$691
Devlin Company
Income Statement
For the year ended May 31
(in thousands)
Net sales Costs and expenses Cost of goods sold Selling, general, and administrative Interest expense Income before taxes Income taxes Net income Year 7$480330528$9036$54 Year 6$460315519$8534$51 (CMA adapted, Jun 97 #16) Refer to the Devlin Company example.Devlin Company's asset turnover for the year ended May 31, Year 7, was
Definitions:
Total Dollar Sales
The overall revenue generated from the sale of goods or services, expressed in terms of the total amount of money received.
Operating Leverage
A financial ratio that measures the proportion of fixed costs in a company's cost structure, indicating how a change in sales will affect its operating income.
Net Operating Income
The income produced through a firm's principal commercial activities, not including the subtractions for interest and taxes.
Sales Volume
The total quantity of goods or services sold by a company in a specific period.