Financial statement data of Westland Engi EEB (Click the icon to view the financ

Question

Financial statement data of Westland Engi EEB (Click the icon to view the financial stat Read the requirements. i Data Table Current ratio Debt rat S 28,000 Accounts payable Cash . Short-term investments Accounts receivable, net Inventories Prepaid expenses Total assets Short-term notes payable 102,000 35,000 60,000 ratios to two decimal places.) 33,000 98,000 37,000 Accrued liabilities Requirement 2. Compute the three ratios 84,000 Long-term notes payable 143,000 Other long-term liabilities . Current ratio Debt ratio 9,000 Net income a. 676.000 Number of common b. 47,000 shares outstanding 45,000 C. d. Print Done Choose from any list or enter any num

Explanation / Answer

Solution:

Current ratio = current assets / Current liabilities

= ($28,000 + $37,000 + $84,000 + $143,000 + $9,000) / ($47,000 + $102,000 + $35,000)

= $301,000 / $184,000 = 1.64:1

Debt ratio = Total liabilities / Total Assets

= (Current liabilities + Long term liabilities) / Total Assets

= ($184,000 + $160,000 + $33,000) / $676,000 = 0.56

Earning per share = Net Income / outstanding common shares = $98,000 / 45000 = $2.18 per share

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