Asset Efficiency Ratios Financial statements for Steele Inc. follow. Steele Inc. Consolidated Income Statements (in thousands except per share amounts) 2023 2022 2021 Net sales $7,245,088 $6,944,296 $6,149,218 Cost of goods sold (5,286,253) (4,953,556) (4,355,675) Gross margin $1,958,835 $1,990,740 $1,793,543 General and administrative expenses (1,259,896) (1,202,042) (1,080,843) Special and nonrecurring items 2,617 0 0 Operating income $701,556 $788,698 $712,700 Interest expense (63,685) (62,398) (63,927) Other income 7,308 10,080 11,529 Gain on sale of investments 0 9,117 0 Income before income taxes $645,179 $745,497 $660,302 Provision for income taxes (254,000) (290,000) (257,000) Net income $391,179 $455,497 $403,302 Steele Inc. Consolidated Balance Sheets (in thousands) ASSETS Dec. 31, 2023 Dec. 31, 2022 Current assets: Cash and equivalents $320,558 $41,235 Accounts receivable 1,056,911 837,377 Inventories 733,700 803,707 Other 109,456 101,811 Total current assets $2,220,625 $1,784,130 Property and equipment, net 1,666,588 1,813,948 Other assets 247,892 248,372 Total assets $4,135,105 $3,846,450 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $250,363 $309,092 Accrued expenses 347,892 274,220 Other current liabilities 15,700 0 Income taxes 93,489 137,466 Total current liabilities $707,444 $720,778 Long-term debt 650,000 541,639 Deferred income taxes 275,101 274,844 Other long-term liabilities 61,267 41,572 Total liabilities 1,693,812 1,578,833 Stockholders’ equity: Preferred stock $100,000 $100,000 Common stock 89,727 89,727 Additional paid-in capital—common stock 128,906 127,776 Retained earnings 2,397,112 2,136,794 $2,715,745 $2,454,297 Less: Treasury stock, at cost (274,452) (186,680) Total stockholders’ equity $2,441,293 $2,267,617 Total liabilities and stockholders’ equity $4,135,105 $3,846,450 Use the information provided above and below to respond to the following requirements. Statement Item January 1, 2022 (in thousands) Accounts receivable $752,945 Inventories 698,604 Total assets 3,485,233 Required: 1. Compute the three asset efficiency ratios for 2022 and 2023. Round your answers to two decimal places. 2023 2022 Accounts receivable turnover ratio fill in the blank 1 fill in the blank 2 Inventory turnover ratio fill in the blank 3 fill in the blank 4 Asset turnover ratio fill in the blank 5 fill in the blank 6 2. Indicate the length of Steele's operating cycle in days for the years ended December 31, 2023, and December 31, 2022. Assume 365 days in a year. Round intermediate calculations and final answers to two decimal places. 2023 fill in the blank 7 days 2022 fill in the blank 8 days

Asset Efficiency Ratios Financial statements for Steele Inc. follow. Steele Inc. Consolidated Income Statements (in thousands except per share amounts) 2023 2022 2021 Net sales $7,245,088 $6,944,296 $6,149,218 Cost of goods sold (5,286,253) (4,953,556) (4,355,675) Gross margin $1,958,835 $1,990,740 $1,793,543 General and administrative expenses (1,259,896) (1,202,042) (1,080,843) Special and nonrecurring items 2,617 0 0 Operating income $701,556 $788,698 $712,700 Interest expense (63,685) (62,398) (63,927) Other income 7,308 10,080 11,529 Gain on sale of investments 0 9,117 0 Income before income taxes $645,179 $745,497 $660,302 Provision for income taxes (254,000) (290,000) (257,000) Net income $391,179 $455,497 $403,302 Steele Inc. Consolidated Balance Sheets (in thousands) ASSETS Dec. 31, 2023 Dec. 31, 2022 Current assets: Cash and equivalents $320,558 $41,235 Accounts receivable 1,056,911 837,377 Inventories 733,700 803,707 Other 109,456 101,811 Total current assets $2,220,625 $1,784,130 Property and equipment, net 1,666,588 1,813,948 Other assets 247,892 248,372 Total assets $4,135,105 $3,846,450 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $250,363 $309,092 Accrued expenses 347,892 274,220 Other current liabilities 15,700 0 Income taxes 93,489 137,466 Total current liabilities $707,444 $720,778 Long-term debt 650,000 541,639 Deferred income taxes 275,101 274,844 Other long-term liabilities 61,267 41,572 Total liabilities 1,693,812 1,578,833 Stockholders’ equity: Preferred stock $100,000 $100,000 Common stock 89,727 89,727 Additional paid-in capital—common stock 128,906 127,776 Retained earnings 2,397,112 2,136,794 $2,715,745 $2,454,297 Less: Treasury stock, at cost (274,452) (186,680) Total stockholders’ equity $2,441,293 $2,267,617 Total liabilities and stockholders’ equity $4,135,105 $3,846,450 Use the information provided above and below to respond to the following requirements. Statement Item January 1, 2022 (in thousands) Accounts receivable $752,945 Inventories 698,604 Total assets 3,485,233 Required: 1. Compute the three asset efficiency ratios for 2022 and 2023. Round your answers to two decimal places. 2023 2022 Accounts receivable turnover ratio fill in the blank 1 fill in the blank 2 Inventory turnover ratio fill in the blank 3 fill in the blank 4 Asset turnover ratio fill in the blank 5 fill in the blank 6 2. Indicate the length of Steele's operating cycle in days for the years ended December 31, 2023, and December 31, 2022. Assume 365 days in a year. Round intermediate calculations and final answers to two decimal places. 2023 fill in the blank 7 days 2022 fill in the blank 8 days

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

Asset Efficiency Ratios

Financial statements for Steele Inc. follow.

Steele Inc.
Consolidated Income Statements
(in thousands except per share amounts)
	2023	2022	2021
Net sales	$7,245,088		$6,944,296	$6,149,218
Cost of goods sold	(5,286,253)		(4,953,556)	(4,355,675)
Gross margin	$1,958,835		$1,990,740	$1,793,543
General and administrative expenses	(1,259,896)		(1,202,042)	(1,080,843)
Special and nonrecurring items	2,617		0	0
Operating income	$701,556		$788,698	$712,700
Interest expense	(63,685)		(62,398)	(63,927)
Other income	7,308		10,080	11,529
Gain on sale of investments	0		9,117	0
Income before income taxes	$645,179		$745,497	$660,302
Provision for income taxes	(254,000)		(290,000)	(257,000)
Net income	$391,179		$455,497	$403,302

Steele Inc.
Consolidated Balance Sheets
(in thousands)
ASSETS	Dec. 31, 2023	Dec. 31, 2022
Current assets:
Cash and equivalents	$320,558		$41,235
Accounts receivable	1,056,911		837,377
Inventories	733,700		803,707
Other	109,456		101,811
Total current assets	$2,220,625		$1,784,130
Property and equipment, net	1,666,588		1,813,948
Other assets	247,892		248,372
Total assets	$4,135,105		$3,846,450
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$250,363		$309,092
Accrued expenses	347,892		274,220
Other current liabilities	15,700		0
Income taxes	93,489		137,466
Total current liabilities	$707,444		$720,778
Long-term debt	650,000		541,639
Deferred income taxes	275,101		274,844
Other long-term liabilities	61,267		41,572
Total liabilities	1,693,812		1,578,833
Stockholders’ equity:
Preferred stock	$100,000		$100,000
Common stock	89,727		89,727
Additional paid-in capital—common stock	128,906		127,776
Retained earnings	2,397,112		2,136,794
	$2,715,745		$2,454,297
Less: Treasury stock, at cost	(274,452)		(186,680)
Total stockholders’ equity	$2,441,293		$2,267,617
Total liabilities and stockholders’ equity	$4,135,105		$3,846,450

Use the information provided above and below to respond to the following requirements.

Statement Item	January 1, 2022 (in thousands)
Accounts receivable	$752,945
Inventories	698,604
Total assets	3,485,233

Required:

1. Compute the three asset efficiency ratios for 2022 and 2023. Round your answers to two decimal places.

	2023	2022
Accounts receivable turnover ratio	fill in the blank 1	fill in the blank 2
Inventory turnover ratio	fill in the blank 3	fill in the blank 4
Asset turnover ratio	fill in the blank 5	fill in the blank 6

2. Indicate the length of Steele's operating cycle in days for the years ended December 31, 2023, and December 31, 2022. Assume 365 days in a year. Round intermediate calculations and final answers to two decimal places.

2023	fill in the blank 7 days
2022	fill in the blank 8 days

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