Question
Below are selected year-end financial statements from the Cabot Corporation. (All sales were on credit; selected balance sheet amounts as of December 31, 2012 were
Below are selected year-end financial statements from the Cabot Corporation. (All sales were on credit; selected balance sheet amounts as of December 31, 2012 were inventory, $52,900; total assets, $179,400; common stock, $100,000; and retained earnings, $52,748.) |
CABOT CORPORATION Income statement For the year ended December 31, 2013 | ||
Sales | ps | 455,600 |
cost of goods sold | 297,450 | |
Gross profit | 158,150 | |
operating expenses | 99,500 | |
Interest expenses | 4,900 | |
income before taxes | 53,750 | |
Income taxes | 21,653 | |
Net Income | ps | 32,097 |
CABOT CORPORATION Balance Sheet December 31, 2013 | ||||||
Assets | Commitments and equity | |||||
Money | ps | 14,000 | Accounts payable | ps | 25,500 | |
Short-term investments | 9,400 | Accrued wages payable | 3.800 | |||
Accounts receivable, net | 33,200 | Income taxes payable | 4,100 | |||
Documents to be collected (trade)* | 6,500 | Long-term note payable, guaranteed | ||||
Merchandise inventory | 36,150 | by mortgage on plant assets | 62,400 | |||
Prepaid expenses | 2,750 | Common actions | 100,000 | |||
Plant assets, net | 150,300 | Retained earnings | 56,500 | |||
total assets | ps | 252,300 | Total liabilities and equity | ps | 252,300 | |
* These are short-term notes receivable derived from customer (commercial) sales. |
Required: |
Calculate the following: (1) current ratio, (2) acid test ratio, (3) days of uncollected sales, (4) inventory turnover, (5) days of sales in inventory, (6) debt to capital, (7) times interest earned, (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stock. (Use all 365 days of the year.) |
Step by Step Solution
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Step: 1
Compute the following 1 current ratio Current ratio Current assetCurrent Liability Current asset Cash Shortterm investments Accounts receivable net No...Get Instant Access to Expert-Tailored Solutions
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