Do It! Review 13-3

The condensed financial statements of Cullumber Company for the years 2016 and 2017 are presented as follows. (Amounts in thousands.)

CULLUMBER COMPANY

Balance Sheets

December 31

2017

2016

Current assets

Cash and cash equivalents

$330

$360

Accounts receivable (net)

670

600

Inventory

660

590

Prepaid expenses

120

160

Total current assets

1,780

1,710

Investments

210

210

Property, plant, and equipment (net)

420

380

Intangibles and other assets

530

510

Total assets

$2,940

$2,810

Current liabilities

$1,100

$990

Long-term liabilities

610

580

Stockholders equitycommon

1,230

1,240

Total liabilities and stockholders equity

$2,940

$2,810

CULLUMBER COMPANY

Income Statements

For the Year Ended December 31

2017

2016

Sales revenue

$4,000

$3,660

Costs and expenses

Cost of goods sold

1,155

1,090

Selling & administrative expenses

2,400

2,330

Interest expense

25

20

Total costs and expenses

3,580

3,440

Income before income taxes

420

220

Income tax expense

126

66

Net income

$ 294

$ 154

Compute the following ratios for 2017 and 2016. (Round current ratio and inventory turnover to 2 decimal places, e.g. 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%.)

(a) Current ratio.

(b) Inventory turnover. (Inventory on 12/31/15, was $390.)

(c) Profit margin.

(d) Return on assets. (Assets on 12/31/15, were $2,070.)

(e) Return on common stockholders equity. (Stockholders equity on 12/31/15, was $990.)

(f) Debt to assets ratio.

(g) Times interest earned.

2017

2016

Current ratio.

:1

:1

Inventory turnover.

Profit margin.

%

%

Return on assets.

%

%

Return on common stockholders equity.

%

%

Debt to assets ratio.

%

%

Times interest earned.

times

times

Do It! Review 13-3 The condensed financial statements of Cullumber Company for the years 2016 and 2017 are presented as follows. (Amounts in thousands.) CULLUMBER COMPANY Balance Sheets nd cash equvaients Inventary Intangibies and sther Current abiites CULLUHBER COMPANY For the Year Ended 31 Compute the following ratios for 2017 and 2016. (Round current ratio and inventory turnover to 2 decimal places, e.g. 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%.) al Current ratio. (bl Inventory turnover. Inventory on 12/31/15, was $390.) ) Profit margin. d) Return on assets. (Assets on 12/31/15, were $2,070.) el Return on common stockholders' equity. (Stockholders' equity on 12/31/15, was $990.) n Debt to assets ratio al Times interest earned By accessing this Question Assistance, you will learn while you earn points based on the Point Potential Policy set by your