The 2021 Income statement of Adrian Express reports sales of $16,932,000, cost of goods sold of $10,363,500, and net income of$1,630,000. Balance sheet information is provided in the following table.ADRIAN EXPRESSBalance SheetsDecember 31, 2021 and 202020212020AssetsCurrent assets:$ 630,000$ 790,000CashAccounts receivableInventory1,460,0001,860,0004,830,000$8,780,000 $7,520,0001,030,0001,430,0004, 270,000Long-term assetsTotal assetsLiabilities and Stockholders' EquityCurrent liabilitiesLong-term liabilities$1,990,000 $1,690,0002,330,0001,970,0002,490,0002,430,0001,970, 0001,430,000Common stockRetained earningsTotal liabilities and stockholders' equity$8,780,000 $7,520,000Industry averages for the following four risk ratios are as follows:Average collection periodAverage days in inventoryCurrent ratioDebt to equity ratio25 days60 days2 to 150%Requlred:1. Calculate the four risk ratios listed above for Adrian Express in 2021. (Use 365 days In a year. Round your answers to 1 declmalplace.)Risk RatiosAverage collection perioddaysAverage days in inventoryCurrent ratioDebt to equity ratiodaysto 1%

Current ratio is calculated by dividing the current assets by current liabilities.

Answered: e 2021 Income statement of Adrian…

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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