LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2017 and 2018 20182017 Gross sales$19,000 $15,000 Sales returns and allowances 1,000 100 Net sales$18,000 $14,900 Cost of merchandise (goods) sold 12,000 9,000 Gross profit$6,000 $5,900 Operating expenses: Depreciation$700 $600 Selling and administrative 2,200 2,000 Research 550 500 Miscellaneous 360 300 Total operating expenses$3,810 $3,400 Income before interest and taxes$2,190 $2,500 Interest expense 560 500 Income before taxes$1,630 $2,000 Provision for taxes 640 800 Net income$990 $1,200 LOGIC COMPANY Comparative Balance Sheet December 31, 2017 and 2018 20182017 Assets Current assets: Cash$12,000 $9,000 Accounts receivable 16,500 12,500 Merchandise inventory 8,500 14,000 Prepaid expenses 24,000 10,000 Total current assets$61,000 $45,500 Plant and equipment: Building (net)$14,500 $11,000 Land 13,500 9,000 Total plant and equipment$28,000 $20,000 Total assets$89,000 $65,500 Liabilities Current liabilities: Accounts payable$13,000 $7,000 Salaries payable 7,000 5,000 Total current liabilities$20,000 $12,000 Long-term liabilities: Mortgage note payable 22,000 20,500 Total liabilities$42,000 $32,500 Stockholders’ Equity Common stock$21,000 $21,000 Retained earnings 26,000 12,000 Total stockholders’ equity$47,000 $33,000 Total liabilities and stockholders’ equity$89,000 $65,500 Calculate the current ratio. (Round your answers to the nearest hundredth.)Calculate the total debt to total assets ratio. (Round your answers to the nearest hundredth.)Calculate the return on equity (after tax) ratio. (Round your answers to the nearest hundredth.)

Name: LOGIC COMPANY Comparative Income Statement For Years Ended December
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Description: LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2017 and 2018 20182017 Gross sales$19,000 $15,000 Sales returns and allowances 1,000 100 Net sales$18,000 $14,900 Cost of merchandise (goods) sold 12,000 9,000

Introduction: Return (after tax) on Equity ratio is a financial performance measuring the…

Answered: Calculate the current ratio. (Round…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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LOGIC COMPANY
	Comparative Income Statement
	For Years Ended December 31, 2017 and 2018

		2018	2017
	Gross sales	$	19,000	$	15,000
	Sales returns and allowances		1,000		100
	Net sales	$	18,000	$	14,900
	Cost of merchandise (goods) sold		12,000		9,000
	Gross profit	$	6,000	$	5,900
	Operating expenses:
	Depreciation	$	700	$	600
	Selling and administrative		2,200		2,000
	Research		550		500
	Miscellaneous		360		300
	Total operating expenses	$	3,810	$	3,400
	Income before interest and taxes	$	2,190	$	2,500
	Interest expense		560		500
	Income before taxes	$	1,630	$	2,000
	Provision for taxes		640		800
	Net income	$	990	$	1,200

LOGIC COMPANY
Comparative Balance Sheet
December 31, 2017 and 2018

	2018	2017
Assets
Current assets:
Cash	$	12,000	$	9,000
Accounts receivable		16,500		12,500
Merchandise inventory		8,500		14,000
Prepaid expenses		24,000		10,000
Total current assets	$	61,000	$	45,500
Plant and equipment:
Building (net)	$	14,500	$	11,000
Land		13,500		9,000
Total plant and equipment	$	28,000	$	20,000
Total assets	$	89,000	$	65,500
Liabilities
Current liabilities:
Accounts payable	$	13,000	$	7,000
Salaries payable		7,000		5,000
Total current liabilities	$	20,000	$	12,000
Long-term liabilities:
Mortgage note payable		22,000		20,500
Total liabilities	$	42,000	$	32,500
Stockholders’ Equity
Common stock	$	21,000	$	21,000
Retained earnings		26,000		12,000
Total stockholders’ equity	$	47,000	$	33,000
Total liabilities and stockholders’ equity	$	89,000	$	65,500

Calculate the current ratio. (Round your answers to the nearest hundredth.)

Calculate the total debt to total assets ratio. (Round your answers to the nearest hundredth.)

Calculate the return on equity (after tax) ratio. (Round your answers to the nearest hundredth.)

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