Selected comparative financial statements of Korbin Company follow. KORBIN COMPANY Comparative Income Statements For Years Ended December 31 2021 2020 2019 Sales $ 508,246 $ 389,358 $ 270,200 Cost of goods sold 305,964 246,853 172,928 Gross profit 202,282 142,505 97,272 Selling expenses 72,171 53,731 35,666 Administrative expenses 45,742 34,264 22,427 Total expenses 117,913 87,995 58,093 Income before taxes 84,369 54,510 39,179 Income tax expense 15,693 11,175 7,953 Net income $ 68,676 $ 43,335 $ 31,226 KORBIN COMPANY Comparative Balance Sheets December 31 2021 2020 2019 Assets Current assets $ 60,248 $ 40,324 $ 53,904 Long-term investments 0 1,000 3,350 Plant assets, net 113,627 103,113 62,412 Total assets $ 173,875 $ 144,437 $ 119,666 Liabilities and Equity Current liabilities $ 25,386 $ 21,521 $ 20,942 Common stock 66,000 66,000 48,000 Other paid-in capital 8,250 8,250 5,333 Retained earnings 74,239 48,666 45,391 Total liabilities and equity $ 173,875 $ 144,437 $ 119,666 Required: 1. Complete the below table to calculate each year's current ratio.
Selected comparative financial statements of Korbin Company follow. KORBIN COMPANY Comparative Income Statements For Years Ended December 31 2021 2020 2019 Sales $ 508,246 $ 389,358 $ 270,200 Cost of goods sold 305,964 246,853 172,928 Gross profit 202,282 142,505 97,272 Selling expenses 72,171 53,731 35,666 Administrative expenses 45,742 34,264 22,427 Total expenses 117,913 87,995 58,093 Income before taxes 84,369 54,510 39,179 Income tax expense 15,693 11,175 7,953 Net income $ 68,676 $ 43,335 $ 31,226 KORBIN COMPANY Comparative Balance Sheets December 31 2021 2020 2019 Assets Current assets $ 60,248 $ 40,324 $ 53,904 Long-term investments 0 1,000 3,350 Plant assets, net 113,627 103,113 62,412 Total assets $ 173,875 $ 144,437 $ 119,666 Liabilities and Equity Current liabilities $ 25,386 $ 21,521 $ 20,942 Common stock 66,000 66,000 48,000 Other paid-in capital 8,250 8,250 5,333 Retained earnings 74,239 48,666 45,391 Total liabilities and equity $ 173,875 $ 144,437 $ 119,666 Required: 1. Complete the below table to calculate each year's current ratio.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Selected comparative financial statements of Korbin Company follow.
KORBIN COMPANY | |||
Comparative Income Statements | |||
For Years Ended December 31 | |||
2021 | 2020 | 2019 | |
---|---|---|---|
Sales | $ 508,246 | $ 389,358 | $ 270,200 |
Cost of goods sold | 305,964 | 246,853 | 172,928 |
Gross profit | 202,282 | 142,505 | 97,272 |
Selling expenses | 72,171 | 53,731 | 35,666 |
Administrative expenses | 45,742 | 34,264 | 22,427 |
Total expenses | 117,913 | 87,995 | 58,093 |
Income before taxes | 84,369 | 54,510 | 39,179 |
Income tax expense | 15,693 | 11,175 | 7,953 |
Net income | $ 68,676 | $ 43,335 | $ 31,226 |
KORBIN COMPANY | |||
Comparative Balance Sheets | |||
December 31 | |||
2021 | 2020 | 2019 | |
---|---|---|---|
Assets | |||
Current assets | $ 60,248 | $ 40,324 | $ 53,904 |
Long-term investments | 0 | 1,000 | 3,350 |
Plant assets, net | 113,627 | 103,113 | 62,412 |
Total assets | $ 173,875 | $ 144,437 | $ 119,666 |
Liabilities and Equity | |||
Current liabilities | $ 25,386 | $ 21,521 | $ 20,942 |
Common stock | 66,000 | 66,000 | 48,000 |
Other paid-in capital | 8,250 | 8,250 | 5,333 |
74,239 | 48,666 | 45,391 | |
Total liabilities and equity | $ 173,875 | $ 144,437 | $ 119,666 |
Required:
1. Complete the below table to calculate each year's
![---
**Current Ratio Analysis**
The table below provides a breakdown of the Current Ratio for the years 2019 to 2021. The Current Ratio is a financial metric that evaluates a company's ability to cover its short-term liabilities with its short-term assets.
- **Current Ratio Formula:**
- **Numerator:** Current assets
- **Denominator:** Current liabilities
- **Calculation:**
\[
\text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}}
\]
### Current Ratio Values by Year
- **2021:** 0 to 1
- **2020:** 0 to 1
- **2019:** 0 to 1
The values presented indicate the ratio remains consistent over the three-year period, reflecting stability in the company's short-term financial health. A ratio of 0 to 1 suggests that current liabilities exceed current assets for these years.
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Transcribed Image Text:---
**Current Ratio Analysis**
The table below provides a breakdown of the Current Ratio for the years 2019 to 2021. The Current Ratio is a financial metric that evaluates a company's ability to cover its short-term liabilities with its short-term assets.
- **Current Ratio Formula:**
- **Numerator:** Current assets
- **Denominator:** Current liabilities
- **Calculation:**
\[
\text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}}
\]
### Current Ratio Values by Year
- **2021:** 0 to 1
- **2020:** 0 to 1
- **2019:** 0 to 1
The values presented indicate the ratio remains consistent over the three-year period, reflecting stability in the company's short-term financial health. A ratio of 0 to 1 suggests that current liabilities exceed current assets for these years.
---
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