166. Fellsmere Corporation Presented below are the condensed balance sheets of Fellsmere Corporation at December 31, 2014 and 2013. Net income for the years ending December 31, 2014 and 2013 is $346,000 and $109,000, respectively. December 31, 2014 December 31, 2013 Current assets $2,228,186 $2,544,683 Property, plant, & equipment (net) 530,589 376,647 Intangibles and other assets 131,206 118,121 Total assets $2,889,981 $3,039,451 Current liabilities $1,429,674 $1,003,906 Long-term obligations 3,360 7,240 Warranty and other liabilities 112,971 98,081 Total liabilities $1,546,605 $1,109,227 Stockholders' equity: Common stock $ 1,566 $ 501,631 Additional paid-in capital 365,986 799,483 Retained earnings 980,509 634,509 Accumulated other comprehensive loss (4,085) (5,489) Total stockholders' equity $1,343,976 $1,930,224 Total liabilities and stockholders' equity $2,889,981 $3,039,451 Read the information about Fellsmere Corporation. Required: (A) Did Fellsmere's current ratio increase or decrease from 2013 to 2014? Make any necessary calculations and explain your answer. Which financial statement users are most concerned with this ratio? (B) The balance sheets show a large increase in retained earnings during 2014. Identify the possible reason(s) for this increase. | |
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