2 MULTIPLE CHOICE. PLEASE ANSWER ASAP. THANK YOU! 28. Based on the following dat
ID: 2400877 • Letter: 2
Question
2 MULTIPLE CHOICE. PLEASE ANSWER ASAP. THANK YOU!
28. Based on the following data for the current year, what is the inventory turnover (rounded to one decimal place)?
a.4.2
b.13
c.18.1
d.5.2
29. Use this information for Kellman Company to answer the question that follow.
The balance sheets at the end of each of the first two years of operations indicate the following:
Using the balance sheets for Kellman Company, if net income is $104,500 and interest expense is $36,100 for Year 2, what is the return on total assets for the year (rounded to two decimal places)?
a.6.56%
b.4.60%
c.7.58%
d.9.46%
Sales on account during year $489,126 Cost of goods sold during year 195,631 Accounts receivable, beginning of year 42,096 Accounts receivable, end of year 51,765 Inventory, beginning of year 33,834 Inventory, end of year 41,634Explanation / Answer
28 Inventory Turnover ratio Inventory Turnover ratio = Cost of goods sold/Average inventory Average inventory =(Beginning inventory+Ending Inventory)/2 Average inventory =($33834+$41634)/2 =$37734 Cost of goods sold = $195631 Inventory Turnover = $195631/$37734 = 5.18 Rounded to 5.2 D. 5.2 29 Return on total assets Return on total assets = Earning before interest/Average assets Net Income $104,500 Add: Interest expenses $36,100 Earning before interest $140,600 Total current assets $576,400 Total investment $41,800 Total property, plant and equipment $761,200 Total Assets for Year 2 $1,379,400 Total current assets $611,300 Total investment $69,400 Total property, plant and equipment $912,700 Total Assets for Year 2 $1,593,400 Average Assets[(1379400+1593400)/2] 1486400 Return on total Assets ($140600/$1486400) 9.46% D. 9.46%
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