Overall ratio analysis The balance sheet for Stud Clothiers is shown next. Sales for the year were $2,400,000, with 90 percent of sales sold on credit. STUD CLOTHIERS Balance Sheet 20X1 Assets Liabilities and Equity Cash…………………… $ 60,000 Accounts payable…………….. $ 220,000 Accounts receivable…... 240,000 Accrued taxes………………… 30,000 Inventory……………… 350,000 Bonds payable (long-term)…………………… 150,000 Plant and equipment…... 410,000 Common stock……………….. 80,000 Paid-in capital………………… 200,000 Retained earnings…………….. 380,000 Total assets………... $1,060,000 Total liabilities and equity… $1,060,000 Compute the following ratios: a. Current ratio. b. Quick ratio. Debt-to-total-assets ratio. Asset turnover. Average collection period.
Overall ratio analysis The balance sheet for Stud Clothiers is shown next. Sales for the year were $2,400,000, with 90 percent of sales sold on credit. STUD CLOTHIERS Balance Sheet 20X1 Assets Liabilities and Equity Cash…………………… $ 60,000 Accounts payable…………….. $ 220,000 Accounts receivable…... 240,000 Accrued taxes………………… 30,000 Inventory……………… 350,000 Bonds payable (long-term)…………………… 150,000 Plant and equipment…... 410,000 Common stock……………….. 80,000 Paid-in capital………………… 200,000 Retained earnings…………….. 380,000 Total assets………... $1,060,000 Total liabilities and equity… $1,060,000 Compute the following ratios: a. Current ratio. b. Quick ratio. Debt-to-total-assets ratio. Asset turnover. Average collection period.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Overall ratio analysis The
|
STUD CLOTHIERS |
|||
|
Balance Sheet 20X1 |
|||
|
Assets |
Liabilities and Equity |
||
|
Cash…………………… |
$ 60,000 |
Accounts payable…………….. |
$ 220,000 |
|
|
240,000 |
Accrued taxes………………… |
30,000 |
|
Inventory……………… |
350,000 |
Bonds payable |
150,000 |
|
Plant and equipment…... |
410,000 |
Common stock……………….. |
80,000 |
|
|
|
Paid-in capital………………… |
200,000 |
|
|
|
|
380,000 |
|
Total assets………... |
$1,060,000 |
Total liabilities and equity… |
$1,060,000 |
Compute the following ratios:
- a.
Current ratio . - b. Quick ratio.
- Debt-to-total-assets ratio.
- Asset turnover.
- Average collection period.
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