Required Calculate the following ratios for 2019 and 2018. Since 2017 numbers ar

Question

Required

Calculate the following ratios for 2019 and 2018. Since 2017 numbers are not presented do not use averages when calculating the ratios for 2018. Instead, use the number presented on the 2018 balance sheet.

Working capital.

Current ratio. (Round your answers to 2 decimal places.)

Quick ratio. (Round your answers to 2 decimal places.)

Receivables turnover (beginning receivables at January 1, 2018, were $47,000). (Round your answers to 2 decimal places.)

Average days to collect accounts receivable. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.)

Inventory turnover (beginning inventory at January 1, 2018, was $140,000). (Round your answers to 2 decimal places.)

Number of days to sell inventory. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.)

Debt to assets ratio. (Round your answers to the nearest whole percent.)

Debt to equity ratio. (Round your answers to 2 decimal places.)

Number of times interest was earned. (Round your answers to 2 decimal places.)

Plant assets to long-term debt. (Round your answers to 2 decimal places.)

Net margin. (Round your answers to 2 decimal places.)

Turnover of assets. (Round your answers to 2 decimal places.)

Return on investment. (Round your answers to 2 decimal places.)

Return on equity. (Round your answers to 2 decimal places.)

Earnings per share. (Round your answers to 2 decimal places.)

Book value per share of common stock. (Round your answers to 2 decimal places.)

Price-earnings ratio (market price per share: 2018, $11.75; 2019, $12.50). (Round your intermediate calculations and final answer to 2 decimal places.)

Dividend yield on common stock. (Round your answers to 2 decimal places.)

ALLENDALE COMPANY Balance Sheets
As of December 31 2019 2018 Assets Current assets Cash $ 40,000 $ 36,000 Marketable securities 20,000 6,000 Accounts receivable (net) 54,000 46,000 Inventories 135,000 143,000 Prepaid items 25,000 10,000 Total current assets 274,000 241,000 Investments 27,000 20,000 Plant (net) 270,000 255,000 Land 29,000 24,000 Total assets $ 600,000 $ 540,000 Liabilities and Stockholders’ Equity Liabilities Current liabilities Notes payable $ 17,000 $ 6,000 Accounts payable 113,800 100,000 Salaries payable 21,000 15,000 Total current liabilities 151,800 121,000 Noncurrent liabilities Bonds payable 100,000 100,000 Other 32,000 27,000 Total noncurrent liabilities 132,000 127,000 Total liabilities 283,800 248,000 Stockholders’ equity Preferred stock, (par value $10, 4% cumulative, non-participating; 8,000 shares authorized and issued) 80,000 80,000 Common stock (no par; 50,000 shares authorized; 10,000 shares issued) 80,000 80,000 Retained earnings 156,200 132,000 Total stockholders’ equity 316,200 292,000 Total liabilities and stockholders’ equity $ 600,000 $ 540,000

Explanation / Answer

1 Working capital = Current asset - current liabilities 2019 2018 Current assets 274000 241000 Current liabilities 151800 121000 Working capital 122200 120000 2 Current ratio = Current assets / current Liabilities Current assets 274000 241000 Current liabilities 151800 121000 Current ratio 1.81 1.99 3 Quick ratio = (current assets - inventory -prepaid expense )/ current liabilities Quick assets 114000 88000 Current liabilities 151800 121000 Acid test ratio 0.75 0.73 4 Receivable turnover = Net sales / Average accounts receivable Net sales   230000 210000 Beginning accounts receivable 46000 47000 Ending accounts receivable 54000 46000 Average accounts receivable 50000 46500 Average accounts receivable = (Beginning + ending )/2 Receivable turnover 4.60 4.52 5 Days sales uncollected = 365 / accounts receivable tunover Days sales uncollected 79.35 80.82 Days 6 Inventory turnover = Cost of goods sold / Average inventory Cost of goods sold 120000 103000 Beginning inventory 143000 140000 Ending inventory 135000 143000 Average inventory 139000 141500 Average inventory = (Beginning + Ending )/2 Inventory turnover 0.86 0.73 7 Days sale in inventory = 365 / inventory turnover Days sales in inventory 422.79 501.43 Days

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.