Financial Statements accounting questions
bzstudent1. Using the data from the following Financial Statements, compute:
a. Current ratio:
b. Quick ratio:
c. Profit margin on sales:
d. Return on total assets:
e. Return on equity:
Balance Sheet | Ajax Corp. | Acme, Inc. | |
Cash | $2,255,000 | $67,000 | |
Accounts Receivable | $565,000 | $1,110,000 | |
Inventory | $1,332,000 | $2,441,000 | |
Total Current Assets | $4,152,000 | $3,618,000 | |
Net Property, Plant and Equipment | $369,000 | $1,327,000 | |
Other Assets | $211,000 | $597,000 | |
Total Assets | $4,732,000 | $5,542,000 | |
Accounts Payable | $27,000 | $168,000 | |
Notes Payable Sort Term | $426,000 | $819,000 | |
Other Short Term Liabilities | $2,000 | $56,000 | |
Total Current Liabilities | $455,000 | $1,043,000 | |
Notes Payable Long Term | $1,222,000 | $943,000 | |
Total Liabilities | $1,677,000 | $1,986,000 | |
Stockholders' Equity | $3,055,000 | $3,556,000 | |
Total Liabilities and Stockholders' Equity | $4,732,000 | $5,542,000 |
Income Statement | Ajax Corp. | Acme, Inc. | |
Sales | $32,752,000 | $4,835,000 | |
Cost of Sales | $28,273,000 | $2,966,000 | |
Gross Profit | $4,479,000 | $1,869,000 | |
Selling, General and Administrative Expenses | $2,541,000 | $912,000 | |
Income before Interest and Taxes | $1,937,000 | $957,000 | |
Interest Expense | $129,000 | $88,000 | |
Income before Taxes | $1,808,000 | $869,000 | |
Taxes | $723,000 | $280,000 | |
Net Income | $1,085,000 | $589,000 |
2. What does each of these financial ratios tell us about a company?
a. Current ratio
b. Quick ratio:
c. Profit margin on sales:
d. Return on total assets:
- e. Return on equity:
10 years ago
5
Purchase the answer to view it
ratios.doc
