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Compute the following ratios for 2027 and 2026. (Round current ratio and inventory turnover to 2 decimal places, eg 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%) (a) Current ratio. (b) Inventory turnover. (Inventory on December 31, 2025, was $370.) (c) Profit margin. (d) Return on assets. (Assets on December 31, 2025, were $1,980.) (e) Return on common stockholders' equity. (Stockholders' equity-common on December 31, 2025, was $970.) (f) Debt to assets ratio. (g) Times interest earned. (a) Current ratio. (b) Inventory turnover (c) Profit margin (d) Return on assets (e) Return on common stockholders' equity. (f) Debt to assets ratio (g) Times interest earned 2027 :1 times % % % ४९ ४९ ४९ % times 2026 :1 times % % de % % times The condensed financial statements of Ivanhoe Company for the years 2026 and 2027 are as follows. IVANHOE COMPANY Balance Sheets December 31 (in thousands) 2027 2026 Current assets Cash and cash equivalents $306 $365 Accounts receivable (net) 630 560 Inventory 600 530 Prepaid expenses 130 160 Total current assets 1,666 1,615 Investments 170 170 Property, plant, and equipment (net) 434 380 Other assets 530 505 Total assets $2,800 $2,670 Current liabilities $980 $950 Long-term liabilities 620 520 Stockholders' equity-common 1,200 1,200 Total liabilities and stockholders' equity $2,800 $2,670 IVANHOE COMPANY Income Statements For the Year Ended December 31 (in thousands) Net sales 2027 2026 $3,940 $3,600 Expenses Cost of goods sold 1,130 1,080 Selling and administrative expenses 2,400 2,330 Interest expense 10 20 Total expenses 3,540 3,430 Income before income taxes 400 170 Income tax expense 160 68 Net income $240 $ 102

Compute the following ratios for 2027 and 2026. (Round current ratio and inventory turnover to 2 decimal places, eg 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%) (a) Current ratio. (b) Inventory turnover. (Inventory on December 31, 2025, was $370.) (c) Profit margin. (d) Return on assets. (Assets on December 31, 2025, were $1,980.) (e) Return on common stockholders' equity. (Stockholders' equity-common on December 31, 2025, was $970.) (f) Debt to assets ratio. (g) Times interest earned. (a) Current ratio. (b) Inventory turnover (c) Profit margin (d) Return on assets (e) Return on common stockholders' equity. (f) Debt to assets ratio (g) Times interest earned 2027 :1 times % % % ४९ ४९ ४९ % times 2026 :1 times % % de % % times The condensed financial statements of Ivanhoe Company for the years 2026 and 2027 are as follows. IVANHOE COMPANY Balance Sheets December 31 (in thousands) 2027 2026 Current assets Cash and cash equivalents $306 $365 Accounts receivable (net) 630 560 Inventory 600 530 Prepaid expenses 130 160 Total current assets 1,666 1,615 Investments 170 170 Property, plant, and equipment (net) 434 380 Other assets 530 505 Total assets $2,800 $2,670 Current liabilities $980 $950 Long-term liabilities 620 520 Stockholders' equity-common 1,200 1,200 Total liabilities and stockholders' equity $2,800 $2,670 IVANHOE COMPANY Income Statements For the Year Ended December 31 (in thousands) Net sales 2027 2026 $3,940 $3,600 Expenses Cost of goods sold 1,130 1,080 Selling and administrative expenses 2,400 2,330 Interest expense 10 20 Total expenses 3,540 3,430 Income before income taxes 400 170 Income tax expense 160 68 Net income $240 $ 102

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Compute the following ratios for 2027 and 2026. (Round current ratio and inventory turnover to 2 decimal places, eg 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%) (a) Current ratio. (b) Inventory turnover. (Inventory on December 31, 2025, was $370.) (c) Profit margin. (d) Return on assets. (Assets on December 31, 2025, were $1,980.) (e) Return on common stockholders' equity. (Stockholders' equity-common on December 31, 2025, was $970.) (f) Debt to assets ratio. (g) Times interest earned. (a) Current ratio. (b) Inventory turnover (c) Profit margin (d) Return on assets (e) Return on common stockholders' equity. (f) Debt to assets ratio (g) Times interest earned 2027 :1 times % % % ४९ ४९ ४९ % times 2026 :1 times % % de % % times
Transcribed Image Text:Compute the following ratios for 2027 and 2026. (Round current ratio and inventory turnover to 2 decimal places, eg 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%) (a) Current ratio. (b) Inventory turnover. (Inventory on December 31, 2025, was $370.) (c) Profit margin. (d) Return on assets. (Assets on December 31, 2025, were $1,980.) (e) Return on common stockholders' equity. (Stockholders' equity-common on December 31, 2025, was $970.) (f) Debt to assets ratio. (g) Times interest earned. (a) Current ratio. (b) Inventory turnover (c) Profit margin (d) Return on assets (e) Return on common stockholders' equity. (f) Debt to assets ratio (g) Times interest earned 2027 :1 times % % % ४९ ४९ ४९ % times 2026 :1 times % % de % % times
The condensed financial statements of Ivanhoe Company for the years 2026 and 2027 are as follows. IVANHOE COMPANY Balance Sheets December 31 (in thousands) 2027 2026 Current assets Cash and cash equivalents $306 $365 Accounts receivable (net) 630 560 Inventory 600 530 Prepaid expenses 130 160 Total current assets 1,666 1,615 Investments 170 170 Property, plant, and equipment (net) 434 380 Other assets 530 505 Total assets $2,800 $2,670 Current liabilities $980 $950 Long-term liabilities 620 520 Stockholders' equity-common 1,200 1,200 Total liabilities and stockholders' equity $2,800 $2,670 IVANHOE COMPANY Income Statements For the Year Ended December 31 (in thousands) Net sales 2027 2026 $3,940 $3,600 Expenses Cost of goods sold 1,130 1,080 Selling and administrative expenses 2,400 2,330 Interest expense 10 20 Total expenses 3,540 3,430 Income before income taxes 400 170 Income tax expense 160 68 Net income $240 $ 102
Transcribed Image Text:The condensed financial statements of Ivanhoe Company for the years 2026 and 2027 are as follows. IVANHOE COMPANY Balance Sheets December 31 (in thousands) 2027 2026 Current assets Cash and cash equivalents $306 $365 Accounts receivable (net) 630 560 Inventory 600 530 Prepaid expenses 130 160 Total current assets 1,666 1,615 Investments 170 170 Property, plant, and equipment (net) 434 380 Other assets 530 505 Total assets $2,800 $2,670 Current liabilities $980 $950 Long-term liabilities 620 520 Stockholders' equity-common 1,200 1,200 Total liabilities and stockholders' equity $2,800 $2,670 IVANHOE COMPANY Income Statements For the Year Ended December 31 (in thousands) Net sales 2027 2026 $3,940 $3,600 Expenses Cost of goods sold 1,130 1,080 Selling and administrative expenses 2,400 2,330 Interest expense 10 20 Total expenses 3,540 3,430 Income before income taxes 400 170 Income tax expense 160 68 Net income $240 $ 102
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