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a) Current ratio. b) Inventory turnover. (Inventory on 12/31/20 was $340.) c) Profit margin. d) Return on assets. (Assets on 12/31/20 were $1,900.) e) Return on common stockholders' equity. (common on 12/31/20 was $900.) f) Debt to assets ratio. g) Times interest earned.

a) Current ratio. b) Inventory turnover. (Inventory on 12/31/20 was $340.) c) Profit margin. d) Return on assets. (Assets on 12/31/20 were $1,900.) e) Return on common stockholders' equity. (common on 12/31/20 was $900.) f) Debt to assets ratio. g) Times interest earned.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Instructions: Compute the following ratios for 2022 and 2021. a) Current ratio. b) Inventory turnover. (Inventory on 12/31/20 was $340.) c) Profit margin. d) Return on assets. (Assets on 12/31/20 were $1,900.) e) Return on common stockholders' equity. (common on 12/31/20 was $900.) f) Debt to assets ratio. g) Times interest earned. Your Answers: (a) format as a ratio (ex 8.7:1) (FYI: pronounced as "8.7 to 1") (b) & (g) format as "times"_(ex 9.9 times) (c), (d), (e) & (f) format as % to one decimal "place" (ex 99.9%) 2022 2021 a) Current Ratio b) Inventory Turnover c) Profit Margin d) Return on Assets e) Return on Common Stockholders Equity f) Debt to Assets Ratio g) Times Interest Earned
Transcribed Image Text:Instructions: Compute the following ratios for 2022 and 2021. a) Current ratio. b) Inventory turnover. (Inventory on 12/31/20 was $340.) c) Profit margin. d) Return on assets. (Assets on 12/31/20 were $1,900.) e) Return on common stockholders' equity. (common on 12/31/20 was $900.) f) Debt to assets ratio. g) Times interest earned. Your Answers: (a) format as a ratio (ex 8.7:1) (FYI: pronounced as "8.7 to 1") (b) & (g) format as "times"_(ex 9.9 times) (c), (d), (e) & (f) format as % to one decimal "place" (ex 99.9%) 2022 2021 a) Current Ratio b) Inventory Turnover c) Profit Margin d) Return on Assets e) Return on Common Stockholders Equity f) Debt to Assets Ratio g) Times Interest Earned
The condensed financial statements of Murawski Company for the years 2021 and 2022 are presented as follows. (Amounts in thousands.) Current Assets: Cash and Cash Equivalents Murawski Company Balance Sheets December 31 Accounts Receivable (net) Inventory Prepaid Expenses Total Current Assets Investments Property Plant & Equipment (net) Intangibles and Other Assets Total Assets Current Liabilities Long-Term Liabilities Stockholders Equity - Common Total Liabilities & Stockholders Equity Net Sales Expenses: Cost of Goods Sold Selling & Administrative Expenses Interest Expense Total Expenses 2022 Income Before Income Tax Income Tax Expense Net Income 330 470 460 120 1,380 Murawski Company Income Statements For Years Ended December 31 10 420 530 2,340 900 410 1,030 2,340 2022 3,800 955 2,400 25 3,380 420 126 294 2021 360 400 390 160 1,310 10 380 510 2,210 790 380 1,040 2,210 2021 3,460 890 2,330 20 3,240 220 66 154
Transcribed Image Text:The condensed financial statements of Murawski Company for the years 2021 and 2022 are presented as follows. (Amounts in thousands.) Current Assets: Cash and Cash Equivalents Murawski Company Balance Sheets December 31 Accounts Receivable (net) Inventory Prepaid Expenses Total Current Assets Investments Property Plant & Equipment (net) Intangibles and Other Assets Total Assets Current Liabilities Long-Term Liabilities Stockholders Equity - Common Total Liabilities & Stockholders Equity Net Sales Expenses: Cost of Goods Sold Selling & Administrative Expenses Interest Expense Total Expenses 2022 Income Before Income Tax Income Tax Expense Net Income 330 470 460 120 1,380 Murawski Company Income Statements For Years Ended December 31 10 420 530 2,340 900 410 1,030 2,340 2022 3,800 955 2,400 25 3,380 420 126 294 2021 360 400 390 160 1,310 10 380 510 2,210 790 380 1,040 2,210 2021 3,460 890 2,330 20 3,240 220 66 154
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