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H$.$ Kalas Inc. H$.$ Kalas Inc.

Income Statement Comparative Balance Sheets

For years ended December $31,2017$ and $2018$ December $31,2018$ and $2017$

$20182017$ Change

$20182017$ Current assets:

Sales $($all on credit$)$ $$670,000$ $$637,000$ Cash $$79,880$

$$44,300$

$$35,580$

Cost of goods sold $(359,000)(294,000)$ Accounts receivable $($net$)38,00032,0006,000$

Gross margin $311,000343,000$ Inventory $44,00042,0002,000$

Prepaid expenses $1,8003,900-2,100$

Depreciation expense $37,00051,000$ Other current assets $2,4903,800-1,310$

Other operating expenses $144,000120,000$ Total current assets $166,170126,00040,170$

Total operating expenses $181,000171,000$

Operating income $130,000172,000$ Long$-$term Investments $81,00056,00025,000$

Other income $($expenses$)$ Plant assets $307,000257,00050,000$

Interest expense $(4,700)(3,500)$ Less: accumulated depreciation $(77,800)(51,000)26,800$

Gain on sale of investments $6,7004,700$ Total plant assets $229,200206,00023,200$

Loss on sale of plant assets $(3,900)(4,700)$ Total assets $476,370388,00088,370$

Total other income $($expenses$)(15,300)(3,500)$

Current liabilities:

Income before income taxes $128,100168,500$ Accounts payable $$25,500$ $$26,000$ $$-500$

Income taxes expense $(38,430)(50,550)$ Accrued liabilities $6,0005,0001,000$

Net income $$89,670$ $$117,950$ Income taxes payable $3,20012,000-8,800$

Total current liabilities $34,70043,000-8,300$

H$.$ Kalas Inc. Long term liabilities:

Statement of Retained Earnings Notes Payable $236,000175,00061,000$

For the year ended December $31,2018$ Total liabilities $270,700218,00052,700$

$20182017$

Ret. earnings, Jan. $1$ $$32,000$ $$0$ Stockholders' equity

Add: net income $89,670117,950$ Common stock, $$5$ par value $110,000110,0000$

Deduct: Dividends $(54,000)(85,950)$ Additional paid$-$in capital $28,00028,0000$

Increase in retained earnings $35,67032,000$ Retained earnings $67,67032,00035,670$

Ret. earnings, Dec. $31$ $$67,670$ $$32,000$ Total stockholders$$ equity $205,670170,00035,670$

Total liabilities and stockholders$$ equity $$476,370$ $$388,000$ $$88,370$

Other information:

Shares of common stock outstanding $22,00022,000$

Earnings per share $$4\mathrm{.}08$ $$5\mathrm{.}36$

Dividends per share $$2\mathrm{.}45$ $$3\mathrm{.}91$

Market price per share, common stock $$16$ $$121.$

$1.$Prepare the cash flows from operations section of H$.$ Kalas Inc.$\text{'}$s $2018$ statement of cash flows using the indirect method. Enter items to be subtracted as negative values.

$2.$Prepare a vertical analysis on the partial income statements for $2017$ and $2018.$ Enter decreases as negative amounts$/$percents$.$

$3.$Prepare a vertical analysis on the partial balance sheets for $2017$ and $2018.$ Enter decreases as negative amounts$/$percents$.$

$4.$ Prepare a vertical analysis on the partial income statements for $2017$ and $2018.$

$5.$Prepare a vertical analysis on the partial balance sheet for $2017$ and $2018.$

$6.$ratios

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