Benson Company shows the following data on its 2014 financial statements: Accounts receivable, January 1 $720,000; Accounts receivable, December 31 960,000; Merchandise inventory, January 1 900,000; Merchandise inventory, December 31 1,020,000; Gross sales 4,800,000; Sales returns and allowances 180,000; Net sales 4,620,000; Cost of goods sold 3,360,000; Income before interest and taxes 720,000; Interest on bonds 192,000; Net income 384,000; The inventory turnover is:

Select one:

a. 3.5 times per year.

b. 4.0 times per year.

c. 5.0 times per year.

d. 4.8125 times per year.

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Benson Company shows the following data on its 2014 financial statements: Accounts receivable, January 1 $720,000; Accounts receivable, December 31 960,000; Merchandise inventory, January 1 900,000; Merchandise inventory, December 31 1,020,000; Gross sales 4,800,000; Sales returns and allowances 180,000; Net sales 4,620,000; Cost of goods sold 3,360,000; Income before interest and taxes 720,000; Interest on bonds 192,000; Net income 384,000; The times interest earned ratio is:

Select one:

a. 4.75 times per year.

b. 3.00 times per year.

c. 3.75 times per year.

d. 2.00 times per year.

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The working capital of a company is equal to:

Select one:

a. total assets less current assets.

b. current assets less current liabilities.

c. stockholders' equity.

d. long-term assets less current assets.

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The gross profit percentage decreased from 36.5% in 2014 to 24.8% in 2015. What is the trend in this change?

Select one:

a. The trend cannot be determined unless the dollar amount of the change is also know.

b. This change represents a downward, or negative, trend.

c. This change represents an upward, or favorable, trend.

d. The answer depends upon whether net sales increased or decreased during the period.

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(T / F) A company that is quite profitable may find it difficult to pay its accounts payable if a large portion of its sales are made on accounts receivable.

Select one:

True

False