Selected year-end financial statements of McCordCorporation follow. (All sales were on credit; selected balancesheet amounts at December 31, 2010, were inventory, $50,900; totalassets, $219,400; common stock, $80,000; and retained earnings,$52,348.)
McCORD CORPORATION
Income Statement
For Year Ended December 31, 2011 Sales $ 451,600 Cost of goods sold 296,950
Gross profit 154,650 Operating expenses 98,700 Interest expense 4,300
Income before taxes 51,650 Income taxes 20,807
Net income $ 30,843
McCORD CORPORATION
Balance Sheet
December 31, 2011 Assets Liabilities and Equity Cash $ 20,000 Accounts payable $ 24,500 Short-term investments 9,400 Accrued wages payable 3,600 Accounts receivable, net 29,400 Income taxes payable 3,400 Notes receivable (trade)* 6,000 Long-term note payable, secured Merchandise inventory 32,150 by mortgage on plant assets 69,400 Prepaid expenses 2,850 Common stock 80,000 Plant assets, net 149,300 Retained earnings 68,200
Total assets $ 249,100 Total liabilities and equity $ 249,100
*These are short-term notes receivable arising from customer (trade)sales.
Required: Compute thefollowing. (Use 365 days ayear. Do not round intermediate calculations and round your finalanswers to 1 decimal place. Omit the "%" sign in yourresponse):
(1) Current ratio to (2) Acid-test ratio to (3) Days' sales uncollected days (4) Inventory turnover times (5) Days' sales in inventory days (6) Debt-to-equity ratio to (7) Times interest earned times (8) Profit margin ratio % (9) Total asset turnover times (10) Return ontotal assets % (11) Return on common stockholders' equity %
Selected year-end financial statements of McCordCorporation follow. (All sales were on credit; selected balancesheet amounts at December 31, 2010, were inventory, $50,900; totalassets, $219,400; common stock, $80,000; and retained earnings,$52,348.)
| McCORD CORPORATION Income Statement For Year Ended December 31, 2011 | ||
| Sales | $ | 451,600 |
| Cost of goods sold | 296,950 | |
| Gross profit | 154,650 | |
| Operating expenses | 98,700 | |
| Interest expense | 4,300 | |
| Income before taxes | 51,650 | |
| Income taxes | 20,807 | |
| Net income | $ | 30,843 |
| | | |
| McCORD CORPORATION Balance Sheet December 31, 2011 | ||||||
| Assets | Liabilities and Equity | |||||
| Cash | $ | 20,000 | Accounts payable | $ | 24,500 | |
| Short-term investments | 9,400 | Accrued wages payable | 3,600 | |||
| Accounts receivable, net | 29,400 | Income taxes payable | 3,400 | |||
| Notes receivable (trade)* | 6,000 | Long-term note payable, secured | ||||
| Merchandise inventory | 32,150 | by mortgage on plant assets | 69,400 | |||
| Prepaid expenses | 2,850 | Common stock | 80,000 | |||
| Plant assets, net | 149,300 | Retained earnings | 68,200 | |||
| Total assets | $ | 249,100 | Total liabilities and equity | $ | 249,100 | |
| | | | | |||
| *These are short-term notes receivable arising from customer (trade)sales. |
| Required: |
| Compute thefollowing. (Use 365 days ayear. Do not round intermediate calculations and round your finalanswers to 1 decimal place. Omit the "%" sign in yourresponse): |
| (1) | Current ratio | to | ||
| (2) | Acid-test ratio | to | ||
| (3) | Days' sales uncollected | days | ||
| (4) | Inventory turnover | times | ||
| (5) | Days' sales in inventory | days | ||
| (6) | Debt-to-equity ratio | to | ||
| (7) | Times interest earned | times | ||
| (8) | Profit margin ratio | % | ||
| (9) | Total asset turnover | times | ||
| (10) | Return ontotal assets | % | ||
| (11) | Return on common stockholders' equity | % |
Related questions
Selected year-end financial statements of Cabot Corporationfollow. (All sales were on credit; selected balance sheet amountsat December 31, 2012, were inventory, $51,900; total assets,$179,400; common stock, $105,000; and retained earnings,$52,148.)
| CABOT CORPORATION Income Statement For Year Ended December 31, 2013 | ||
| Sales | $ | 451,600 |
| Costof goods sold | 297,150 | |
| Gross profit | 154,450 | |
| Operating expenses | 99,300 | |
| Interest expense | 4,700 | |
| Income before taxes | 50,450 | |
| Income taxes | 20,323 | |
| Netincome | $ | 30,127 |
| CABOT CORPORATION Balance Sheet December 31, 2013 | ||||||
| Assets | Liabilities and Equity | |||||
| Cash | $ | 20,000 | Accounts payable | $ | 15,500 | |
| Short-term investments | 9,000 | Accrued wages payable | 3,800 | |||
| Accounts receivable, net | 32,800 | Income taxes payable | 4,100 | |||
| Notes receivable (trade)* | 4,500 | Long-term note payable, secured | ||||
| Merchandise inventory | 42,150 | by mortgage on plant assets | 65,400 | |||
| Prepaid expenses | 3,000 | Common stock | 105,000 | |||
| Plant assets, net | 147,300 | Retained earnings | 64,950 | |||
| Total assets | $ | 258,750 | Total liabilities and equity | $ | 258,750 | |
| * These areshort-term notes receivable arising from customer (trade)sales. |
| Required: |
Compute the following: (1) current ratio, (2) acid-test ratio,(3) days' sales uncollected, (4) inventory turnover, (5) days'sales in inventory, (6) debt-to-equity ratio, (7) times interestearned, (8) profit margin ratio, (9) total asset turnover, (10)return on total assets, and (11) return on common stockholders'equity. (Use 365 days a year. Do not round intermediatecalculations.) |
