The following information opplies to the questions displayed below) Income state
ID: 2534967 • Letter: T
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The following information opplies to the questions displayed below) Income statement and balance sheet data for Great Adventures, Inc., are provided below. GREAT ADVENTURES. INC Income Storement For the Yeer Ended December 31, 2020 Service revenue (clinic, recing. TEAM) Sales revenue (MU watches) 531000 106.000 Totel rovonue: $637000 Expenses: Cost of goods sold (MU watches) Operating expenses Deprecletion expense ntorestaxponz0 Income tax expense 64000 303.070 44.000 29,124 53.400 Totel expenses 494.200 Net income $142.300 GREAT ADVENTURES, INC. Belance Sheet: December 31, 2020 and 2019 Increose 0 or Decreese (D) 2020 2019 Accot: Current ascet:: 183.928 15.928 S132.000 29.000 13.400 10.400 Cesh Accounts recevoble 30.000 16,100 12,100 7000 ( 2.700 ( 1,700( Other current assets Long-term ascets: 300,000 1100000 300000 59.000 67,750 9.000 (23750) 44000( Total ossets 5 1771378 220.050 Liabilities and Stockholders' Equity Current liobilities: $11,100 600 53.400 8.400 2.700( Accounts peyeble Intorost payablo Income tax pay 690 18,400( 35,000 27000 402428( 25,000 able Long-term liabilities: Notes payable 429.428 Stockholders' equity 100.000 Common stock Paid-in cepital Retained earnings Treasury stock 125.000 1106.000 147760 0 1106,000 ( 23.800 ( 23.960 102.000) 102.000) Totel liabilities and stockholders equity $1,771,378 220.050 As you can tell from the financial statements, 2020 was an especially busy year. Tony and Suzie were able to use the $1.2 mliion recelived from the issuance of 100,000 shares of stock to hire a construction company for $1 million to build the cabins, dining facilities, ropes course, and the outdoor swimming pool They even put In a baby pool to celebrate the blrth of thelr firstbom son, little Venture Matheson. Assume all sales and services are on credt.Explanation / Answer
1 Formula a Receivables turnover ratio 4.90 times sales/average accounts receivable 637000/(36000+29000)/2 b Average collection period 18.62 days average debtors/average daily sales ((36000+29000)/2)/(637000/365) c Inventory turnover ratio 1.97 times cost of goods sold/average inventory 64000/((36000+29000)/2) d Average days in inventory 185.35 days average inventory/(COGS/days) ((36000+29000)/2)/(64000/365) e Current ratio 5.83 to 1 current assets/current liabilities (315928+36000+16100+12100)/(11100+690+53400) f Acid test ratio 5.58 to 1 current assets - inventory/current liabilities (315928+36000+12100)/(11100+690+53400) g Debt to equity ratio 38.74 % total liabilities/total equity (11100+690+53400+429428)/(125000+1106000+147760-102000)*100 h Times interest earned ratio 7.74 times EBIT/Interest (637000-64000-303676-44000)/29124 2 Formula a Gross profit ratio (MU watches) 39.62 % gross profit/sales (106000-64000)/106000*100 b Return on assets 14.34 % net income/average total assets (142800)/((1771378+220050)/2)*100 c Profit margin 22.42 % net income/revenue 142800/637000*100 d Asset turnover 0.64 times revenue/average assets 637000/((1771378+220050)/2) e Return on equity 20.03 % net income/average net worth 142800/((125000+25000+1106000+147760+123950-102000)/2)*100
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