Selected year-end financial statements of Overton Corporation follow. (All sales were on credit; selected balance sheet amounts
Question:
Selected year-end financial statements of Overton Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2015, were inventory, $17,400; total assets, $94,900; common stock, $35,500; and retained earnings, $18,800.)
OVERTON CORPORATION
Income Statement
For Year Ended December 31, 2016
Sales . . . . . . . . . . . . . . . . . . . . . . $315,500
Cost of goods sold . . . . . . . . . . . 236,100
Gross profit . . . . . . . . . . . . . . . . . . 79,400
Operating expenses . . . . . . . . . . . 49,200
Interest expense . . . . . . . . . . . . . . . 2,200
Income before taxes . . . . . . . . . . . 28,000
Income taxes . . . . . . . . . . . . . . . . . 4,200
Net income . . . . . . . . . . . . . . . . . $ 23,800
OVERTON CORPORATION
Balance Sheet
December 31, 2016
* These are short-term notes receivable arising from customer (trade) sales.
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. Round to one decimal place; for part 6, round to two decimals?
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Step by Step Answer:
Financial Accounting Information for Decisions
ISBN: 978-1259533006
8th edition
Authors: John J. Wild