Income statement and balance sheet data for The Athletic Attic are provided below. THE ATHLETIC ATTICIncome StatementsFor the Years Ended December 31 20252024Net sales$ 10,680,000$ 9,100,000Cost of goods sold6,980,0005,600,000Gross profit3,700,0003,500,000Expenses: Operating expenses1,620,0001,570,000Depreciation expense200,000200,000Interest expense42,00042,000Income tax expense424,000370,000Total expenses2,286,0002,182,000Net income$ 1,414,000$ 1,318,000 THE ATHLETIC ATTICBalance SheetsDecember 31 202520242023Assets Current assets: Cash$ 227,000$ 156,000$ 208,000Accounts receivable992,000742,000762,000Inventory1,727,0001,357,0001,027,000Supplies132,000102,00077,000Long-term assets: Equipment1,180,0001,180,0001,180,000Less: Accumulated depreciation(620,000)(420,000)(220,000)Total assets$ 3,638,000$ 3,117,000$ 3,034,000Liabilities and Stockholders' Equity Current liabilities: Accounts payable$ 180,800$ 111,000$ 88,800Interest payable4,20004,200Income tax payable42,00037,00032,000Long-term liabilities: Notes payable520,000520,000520,000Stockholders' equity: Common stock620,000620,000620,000Retained earnings2,271,0001,829,0001,769,000Total liabilities and stockholders’ equity$ 3,638,000$ 3,117,000$ 3,034,000 Required:1. Calculate the following risk ratios for 2024 and 2025: (Round your answers to 1 decimal place.) Required:1. Calculate the following risk ratios for 2024 and 2025: (Round your answers to 1 decimal place.)Receivables turnover ratioInventory turnover ratioCurrent ratioDebt to equity ratio20242025timestimestimestimes%%

Average Accounts Receivable for 2024 = (742,000 + 762,000) / 2 = 752,000Receivables Turnover 2024 =…

Answered: Required: 1. Calculate the following…

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Income statement and balance sheet data for The Athletic Attic are provided below.

	2025	2024	2023
THE ATHLETIC ATTIC
Balance Sheets
December 31
Assets
Current assets:
Cash	$ 227,000	$ 156,000	$ 208,000
Accounts receivable	992,000	742,000	762,000
Inventory	1,727,000	1,357,000	1,027,000
Supplies	132,000	102,000	77,000
Long-term assets:
Equipment	1,180,000	1,180,000	1,180,000
Less: Accumulated depreciation	(620,000)	(420,000)	(220,000)
Total assets	$ 3,638,000	$ 3,117,000	$ 3,034,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$ 180,800	$ 111,000	$ 88,800
Interest payable	4,200	0	4,200
Income tax payable	42,000	37,000	32,000
Long-term liabilities:
Notes payable	520,000	520,000	520,000
Stockholders' equity:
Common stock	620,000	620,000	620,000
Retained earnings	2,271,000	1,829,000	1,769,000
Total liabilities and stockholders’ equity	$ 3,638,000	$ 3,117,000	$ 3,034,000