Question
Company: PQR Logistics Financial Data for 2023 (in $000): Item Amount Cash 40,000 Accounts Receivable 35,000 Inventory 15,000 Prepaid Expenses 10,000 Total Current Assets 100,000
Company: PQR Logistics
Financial Data for 2023 (in $000):
Item | Amount |
Cash | 40,000 |
Accounts Receivable | 35,000 |
Inventory | 15,000 |
Prepaid Expenses | 10,000 |
Total Current Assets | 100,000 |
Property, Plant & Equipment | 180,000 |
Total Assets | 280,000 |
Accounts Payable | 25,000 |
Short-term Debt | 20,000 |
Other Current Liabilities | 10,000 |
Total Current Liabilities | 55,000 |
Long-term Debt | 90,000 |
Equity | 135,000 |
Total Liabilities and Equity | 280,000 |
Income Statement for 2023 (in $000):
Item | Amount |
Sales | 500,000 |
Cost of Goods Sold | 320,000 |
Gross Profit | 180,000 |
Operating Expenses | 80,000 |
Interest Expense | 25,000 |
Net Income Before Taxes | 75,000 |
Taxes | 15,000 |
Net Income | 60,000 |
Requirements:
- Calculate the Current Ratio and Quick Ratio.
- Compute the Debt-Equity Ratio.
- Determine the Gross Profit Margin and Net Profit Margin.
- Calculate the Asset Turnover Ratio and Inventory Turnover Ratio.
- Explain how liquidity ratios affect the company's short-term financial stability.
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