Plants 'n Growin' When It Grows Nursery Things Nursery Net income after taxes: $59,000 Owners' equity: $390,000 Return on owners' equity: Return on Owners' Equity Which nursery is doing better? Net income after taxes: $209,000 Owners' equity: $130,000 Return on owners' equity: Return on Sales Net income after taxes: $59,000 Net sales: $190,000 Net income after taxes: $209,000 Net sales: $980,000 Which nursery is doing better? Return on sales: Return on sales: Current Ratio Current assets: $289,000 Current liabilities: $178,000 Current assets: $499,000 Current liabilities: $388,000 Which nursery is doing better? Current ratio: Current ratio: Accounts Receivable Turnover Net sales: $190,000 Accounts receivable: $22,000 Net sales: $980,000 Accounts receivable: $87,500 Which nursery is doing better? Accounts receivable turnover: Accounts receivable turnover: Cost of goods sold: $121,000 Average inventory: $22,000 Inventory Turnover Which nursery is doing better? Cost of goods sold: $688,000 Average inventory: $90,000 Inventory turnover: Inventory turnover: After calculating the above ratios and determining which nursery is doing better in each individual ratio, which nursery are you most interested in? Why? What could be done to improve the ratio(s) that were not favorable for the nursery you chose?
Plants 'n Growin' When It Grows Nursery Things Nursery Net income after taxes: $59,000 Owners' equity: $390,000 Return on owners' equity: Return on Owners' Equity Which nursery is doing better? Net income after taxes: $209,000 Owners' equity: $130,000 Return on owners' equity: Return on Sales Net income after taxes: $59,000 Net sales: $190,000 Net income after taxes: $209,000 Net sales: $980,000 Which nursery is doing better? Return on sales: Return on sales: Current Ratio Current assets: $289,000 Current liabilities: $178,000 Current assets: $499,000 Current liabilities: $388,000 Which nursery is doing better? Current ratio: Current ratio: Accounts Receivable Turnover Net sales: $190,000 Accounts receivable: $22,000 Net sales: $980,000 Accounts receivable: $87,500 Which nursery is doing better? Accounts receivable turnover: Accounts receivable turnover: Cost of goods sold: $121,000 Average inventory: $22,000 Inventory Turnover Which nursery is doing better? Cost of goods sold: $688,000 Average inventory: $90,000 Inventory turnover: Inventory turnover: After calculating the above ratios and determining which nursery is doing better in each individual ratio, which nursery are you most interested in? Why? What could be done to improve the ratio(s) that were not favorable for the nursery you chose?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Plants 'n Growin'
When It Grows Nursery
Things Nursery
Net income after taxes: $59,000
Owners' equity: $390,000
Return on owners' equity:
Return on Owners' Equity
Which nursery is doing better?
Net income after taxes: $209,000
Owners' equity: $130,000
Return on owners' equity:
Return on Sales
Net income after taxes: $59,000
Net sales: $190,000
Net income after taxes: $209,000
Net sales: $980,000
Which nursery is doing better?
Return on sales:
Return on sales:
Current Ratio
Current assets: $289,000
Current liabilities: $178,000
Current assets: $499,000
Current liabilities: $388,000
Which nursery is doing better?
Current ratio:
Current ratio:
Accounts Receivable Turnover
Net sales: $190,000
Accounts receivable: $22,000
Net sales: $980,000
Accounts receivable: $87,500
Which nursery is doing better?
Accounts receivable turnover:
Accounts receivable turnover:
Cost of goods sold: $121,000
Average inventory: $22,000
Inventory turnover:
Inventory Turnover
Which nursery is doing better?
Cost of goods sold: $688,000
Average inventory: $90,000
Inventory turnover:
After calculating the above ratios and determining which nursery is doing better in each
individual ratio, which nursery are you most interested in? Why?
What could be done to improve the ratio(s) that were not favorable for the nursery you chose?
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