Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $49,900; total assets, $209,400; common stock, $87,000; and retained earnings, $41,829.) CABOT CORPORATION Balance Sheet December 31 Assets Liabilities and Equity Cash Short-term investments Accounts receivable, net Merchandise inventory $ 18,e00 Accounts payable 9, 200 Accrued wages payable 30, 800 Income taxes payable 40,150 Long-term note payable, secured by 24 18,500 3,800 4,400 65,40e mortgage on plant assets Prepaid expenses Plant assets, net 2,800 Common stock 151, 300 Retained earnings $ 252, 250 Total liabilities and equity 87, eee 73,15e $ 252, 250 Total assets CABOT CORPORATION Income Statement For Current Year Ended December 31 $ 453,600 297,85e 155, 750 98, see 4, 800 52,45e 21, 129 31, 321 Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income tax expense Net income Required: Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory. (6) debt-to-equity ratio, (7) times interest earned. (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stockholders' equity. (Do not round Intermedlate calculations.)
Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $49,900; total assets, $209,400; common stock, $87,000; and retained earnings, $41,829.) CABOT CORPORATION Balance Sheet December 31 Assets Liabilities and Equity Cash Short-term investments Accounts receivable, net Merchandise inventory $ 18,e00 Accounts payable 9, 200 Accrued wages payable 30, 800 Income taxes payable 40,150 Long-term note payable, secured by 24 18,500 3,800 4,400 65,40e mortgage on plant assets Prepaid expenses Plant assets, net 2,800 Common stock 151, 300 Retained earnings $ 252, 250 Total liabilities and equity 87, eee 73,15e $ 252, 250 Total assets CABOT CORPORATION Income Statement For Current Year Ended December 31 $ 453,600 297,85e 155, 750 98, see 4, 800 52,45e 21, 129 31, 321 Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income tax expense Net income Required: Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory. (6) debt-to-equity ratio, (7) times interest earned. (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stockholders' equity. (Do not round Intermedlate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts
at December 31 of the prior year were inventory. $49,900: total assets. $209,400; common stock, $87,000; and retained earnings,
$41,829.)
CABOT CORPORATION
Balance Sheet
December 31
Assets
Liabilities and Equity
Cash
Short-term investments
Accounts receivable, net
Merchandise inventory
18, 000 Accounts payable
9, 200
30, 800 Income taxes payable
40,150 Long-term note payable, secured by
18,500
3, 800
4,400
65,400
Accrued wages payable
mortgage on plant assets
Prepaid expenses
Plant assets, net
2,800 Common stock
151, 300 Retained earnings
$ 252, 250 Total liabilities and equity
87, e00
73,150
$ 252, 250
Total assets
CABOT CORPORATION
Income Statement
For Current Year Ended December 31
$ 453, 600
297,850
155,750
98, 500
4,800
52,450
21,129
Sales
Cost of goods sold
Gross profit
Operating expenses
Interest expense
Income before taxes
Income tax expense
Net income
24
31,321
Requlred:
Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory.
(6) debt-to-equity ratio, (7) times interest earned, (8) profit margin ratio. (9) total asset turnover, (10) return on total assets, and (11) return
on common stockholders' equity. (Do not round Intermedlate calculations.)
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