I\'ll rate do all short as questions if you can\'t do all pass it to someone els
ID: 2414375 • Letter: I
Question
I'll rate do all short as questions if you can't do all pass it to someone else please
1. Starlight Company had the following data taken from its most recent financial statements:
Based on these data, calculate Starlight Company’s return on total assets.
8%
12.5%
27.8%
None of these choices are correct.
b
2. Starlight Company had the following data taken from its most recent financial statements:
Based on these data, calculate Starlight Company’s return on stockholders’ equity.
2%
32.3%
62.5%
None of these choices are correct.
3. Johnston & Myers Inc. had the following balance sheet data for a recent year:
What is Johnston & Myers Inc.’s ratio of liabilities to stockholders’ equity?
0.5
0.7
0.9
None of these choices are correct.
4. Patton Corporation had the following items on its financial statements for two recent years:
Based on these data, calculate Patton Corporation’s working capital for Year 2.
$725,000
$1,625,000
$2,050,000
None of these choices are correct.
5. Patton Corporation had the following items on its financial statements for two recent years:
Based on these data, calculate Patton Corporation’s accounts receivable turnover for Year 2.
6.7
12.5
14.3
None of these choices are correct.
6. Patton Corporation had the following items on its financial statements for two recent years:
Based on these data, calculate Patton Corporation’s number of days’ sales in inventory for Year 2.
3.2
57.8
5.7
6.3
Sales $3,200,000 Interest expense 56,000 Net income 500,000 Total assets 4,000,000 Total liabilities 2,400,000 Total stockholders’ equity 1,600,000Explanation / Answer
1.
Return on total assets = Net income / Total assets
= 5,00,000 / 40,00,000 = 8%
Starlight Company’s return on total assets is 8%.
2.
Return on stockholders’ equity =
Net income / Total stockholders’ equity
=5,00,000 / 16,00,000 = 31.25%
Answer is "None of these choice are correct"
3.
Ratio of liabilities to stockholders’ equity
= Total Liabilities / stockholders’ equity
= 6,80,000 / 12,50,000 = 0.544
Johnston & Myers Inc.’s ratio of liabilities to stockholders’ equity is 0.5
4.
Total Current asset = Cash + Temporary investments +Accounts receivable (net)+Inventory
= 5,00,000+1,50,000+2,00,000+3,25,000 = 11,75,000
Total current liabilities = Accounts payable = 4,50,000
Working capital = Total Current asset - Total current liabilities
= 11,75,000 - 4,50,000 = 7,25,000
Patton Corporation’s working capital for Year 2 is 7,25,000.
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