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Information for Patel Corporation is given below: Patel Corporation Balance Sheet December 31, 2021 630,000 189,000 Cash 350,000 Accounts payable 1,950,000 Income taxes payable 2,439,000 Miscellaneous accrued payables Bonds payable (8%, due 2023) 1,983,000 Preferred stock ($100 par, 6% 261,000 cumulative nonparticipating) 75,000 Common stock (no par, 60,000 $ 7.058,000 shares authorized, issued Accounts receivable (net) Inventories 275,000 1,875,000 Plant and equipment, net of depreciation Patents Other intangible assets 750,000 Total Assets 1,125,000 2,439,000 and outstanding) Retained earnings Treasury stock-1,500 shares of preferred Total Equities (225,000) $ 7.058.000 Patel Corporation Income Statement Year ended December 31, 2021 Net sales $ 9,000,000 6,000,000 Cost of goods sold Gross profit 3,000,000 Operating expenses (including bond interest expense). Income before income taxes 1,500,000 1,500,000 450,000 Income tax Net income $ 1,050,000 Additional information: There are no preferred dividends in arrears, the balances in the Accounts Receivable and Inventory accounts are unchanged from January 1, 2021, and there were no changes in the Bonds Payable, Preferred Stock, or Common Stock accounts during 2021. Assume that preferred dividends for the current year have not been declared. Calculate the following ratios at December 31, 2021, show calculations for full credit. 1. Current ratio 2. Acid-test ratio 3. Accounts receivable turnover

Information for Patel Corporation is given below: Patel Corporation Balance Sheet December 31, 2021 630,000 189,000 Cash 350,000 Accounts payable 1,950,000 Income taxes payable 2,439,000 Miscellaneous accrued payables Bonds payable (8%, due 2023) 1,983,000 Preferred stock ($100 par, 6% 261,000 cumulative nonparticipating) 75,000 Common stock (no par, 60,000 $ 7.058,000 shares authorized, issued Accounts receivable (net) Inventories 275,000 1,875,000 Plant and equipment, net of depreciation Patents Other intangible assets 750,000 Total Assets 1,125,000 2,439,000 and outstanding) Retained earnings Treasury stock-1,500 shares of preferred Total Equities (225,000) $ 7.058.000 Patel Corporation Income Statement Year ended December 31, 2021 Net sales $ 9,000,000 6,000,000 Cost of goods sold Gross profit 3,000,000 Operating expenses (including bond interest expense). Income before income taxes 1,500,000 1,500,000 450,000 Income tax Net income $ 1,050,000 Additional information: There are no preferred dividends in arrears, the balances in the Accounts Receivable and Inventory accounts are unchanged from January 1, 2021, and there were no changes in the Bonds Payable, Preferred Stock, or Common Stock accounts during 2021. Assume that preferred dividends for the current year have not been declared. Calculate the following ratios at December 31, 2021, show calculations for full credit. 1. Current ratio 2. Acid-test ratio 3. Accounts receivable turnover

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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Information for Patel Corporation is given below: Patel Corporation Balance Sheet December 31, 2021 350,000 Accounts payable 1,950,000 Income taxes payable 2,439,000 Miscellaneous accrued payables Cash $ 630,000 Accounts receivable (net) 189,000 275,000 1,875,000 Inventories Bonds payable (8%, due 2023) Plant and equipment, net of depreciation 1,983,000 Preferred stock ($100 par, 6% 261,000 cumulative nonparticipating) 75,000 Common stock (no par, 60,000 $ 7,058,000 Patents 750,000 Other intangible assets Total Assets shares authorized, issued and outstanding) Retained earnings Treasury stock-1,500 shares of preferred Total Equities 1,125,000 2,439,000 (225,000) $ 7,058,000 Patel Corporation Income Statement Year ended December 31, 2021 Net sales Cost of goods sold Gross profit Operating expenses (including bond interest expense) Income before income taxes $ 9,000,000 6,000,000 3,000,000 1,500,000 1,500,000 450,000 $ 1,050,000 Income tax Net income Additional information: There are no preferred dividends in arrears, the balances in the Accounts Receivable and Inventory accounts are unchanged from January 1, 2021, and there were no changes in the Bonds Payable, Preferred Stock, or Common Stock accounts during 2021. Assume that preferred dividends for the current year have not been declared. Calculate the following ratios at December 31, 2021, show calculations for full credit. 1. Current ratio 2. Acid-test ratio 3. Accounts receivable turnover 4. Inventory turnover 5. Profit margin on sales 6. Return on common stockholders' equity 7. Debt to assets ratio
Transcribed Image Text:Information for Patel Corporation is given below: Patel Corporation Balance Sheet December 31, 2021 350,000 Accounts payable 1,950,000 Income taxes payable 2,439,000 Miscellaneous accrued payables Cash $ 630,000 Accounts receivable (net) 189,000 275,000 1,875,000 Inventories Bonds payable (8%, due 2023) Plant and equipment, net of depreciation 1,983,000 Preferred stock ($100 par, 6% 261,000 cumulative nonparticipating) 75,000 Common stock (no par, 60,000 $ 7,058,000 Patents 750,000 Other intangible assets Total Assets shares authorized, issued and outstanding) Retained earnings Treasury stock-1,500 shares of preferred Total Equities 1,125,000 2,439,000 (225,000) $ 7,058,000 Patel Corporation Income Statement Year ended December 31, 2021 Net sales Cost of goods sold Gross profit Operating expenses (including bond interest expense) Income before income taxes $ 9,000,000 6,000,000 3,000,000 1,500,000 1,500,000 450,000 $ 1,050,000 Income tax Net income Additional information: There are no preferred dividends in arrears, the balances in the Accounts Receivable and Inventory accounts are unchanged from January 1, 2021, and there were no changes in the Bonds Payable, Preferred Stock, or Common Stock accounts during 2021. Assume that preferred dividends for the current year have not been declared. Calculate the following ratios at December 31, 2021, show calculations for full credit. 1. Current ratio 2. Acid-test ratio 3. Accounts receivable turnover 4. Inventory turnover 5. Profit margin on sales 6. Return on common stockholders' equity 7. Debt to assets ratio
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