Kindly provide accurate figures, I have limited trials. Thanks. Sandhill NV\'s c
ID: 2600309 • Letter: K
Question
Kindly provide accurate figures, I have limited trials. Thanks.
Sandhill NV's comparative statements of financial position are presented below SANDHILL NV Statements of Financial Position December 31 2017 2016 Land Buildings Accumulated depreciation-buildings Inventory Accounts receivable Cash 19,870 69,790 26,290 69,790 (15,050) (10,630) 10,190 22,150 4,170 111,120 75,830 22,720 12,570 111,120 7,440 23,860 3,540 120,290 68,060 21,570 30,660 120,290 Total Share capital-ordinary Retained earnings Accounts payable Total Sandhill's 2017 income statement included net sales of 115,320, cost of goods sold of 59,600, and net income of 15,060 Compute the following ratios for 2017, (Round all answers to 2 decimal places, e.g. 1.64, or 1.64% .) (a) Current ratio (b) Acid-test ratio (c) Accounts receivable turnover (d) Inventory turnover (e) Profit margin (f) Asset turnover (g) Return on assets (h) Return on ordinary shareholders' equity (i) Debt to assets ratio times times timesExplanation / Answer
Answer a.
Current Assets = Cash + Accounts Receivable + Inventory
Current Assets = $4,170 + $22,150 + $10,190
Current Assets = $36,510
Current Liabilities = Accounts Payable
Current Liabilities = $12,570
Current Ratio = Current Assets / Current Liabilities
Current Ratio = $36,510 / $12,570
Current Ratio = 2.90 : 1
Answer b.
Quick Assets = Cash + Accounts Receivable
Quick Assets = $4,170 + $22,150
Quick Assets = $26,320
Current Liabilities = Accounts Payable
Current Liabilities = $12,570
Acid-test Ratio = Quick Assets / Current Liabilities
Acid-test Ratio = $26,320 / $12,570
Acid-test Ratio = 2.09 : 1
Answer c.
Average Accounts Receivable = (Accounts Receivable 2016 + Accounts Receivable 2017) / 2
Average Accounts Receivable = ($23,860 + $22,150) / 2
Average Accounts Receivable = $23,005
Accounts Receivable Turnover = Net Sales / Average Accounts Receivable
Accounts Receivable Turnover = $115,320 / $23,005
Accounts Receivable Turnover = 5.01 times
Answer d.
Average Inventory = (Inventory 2016 + Inventory 2017) / 2
Average Inventory = ($7,440 + $10,190) / 2
Average Inventory = $8,815
Inventory Turnover = Cost of Goods Sold / Average Inventory
Inventory Turnover = $59,600 / $8,815
Inventory Turnover = 6.76 times
Answer e.
Profit Margin = Net Income / Net Sales
Profit Margin = $15,060 / $115,320
Profit Margin = 13.06%
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