Financial Ratios

1. Based on the financial statements for Jackson Enterprises (income statement, statement of owners equity, and balance sheet) shown below, prepare the following financial ratios. All sales are credit sales. The Accounts Receivable balance on January 1, 20--, was $21,156. Assume 365 days per year. If required, round your answers to two decimal places. For return on owner's equity, enter as a percent but do not include percent sign.

Round average number of days answers to one decimal place.

1. Working capital
2. Current ratio
3. Quick ratio
4. Return on owner's equity
5. Accounts receivable turnover and average number of days required to collect receivables
6. Inventory turnover and average number of days required to sell inventory

Jackson Enterprises Income Statement For Year Ended December 31, 20 --
Revenue from sales:
Sales			$184,010
Less sales returns and allowances			2,016
Net sales				$181,994
Cost of goods sold:
Merchandise inventory, January 1, 20--			$31,490
Purchases		$93,270
Less: Purchases returns and allowances	$1,812
Purchases discounts	1,878	3,690
Net purchases		$89,580
Add freight-in		941
Cost of goods purchased			90,521
Goods available for sale			$122,011
Less merchandise inventory, December 31, 20--			28,361
Cost of goods sold				93,650
Gross profit				$88,344
Operating expenses:
Wages expense			$38,220
Advertising expense			1,156
Supplies expense			396
Phone expense			2,276
Utilities expense			11,344
Insurance expense			908
Depreciation expense-building			3,608
Depreciation expense-equipment			3,776
Miscellaneous expense			506
Total operating expenses				62,190
Income from operations				$26,154
Other revenues:
Interest revenue			$1,776
Other expenses:
Interest expense			872	904
Net income				$27,058

Jackson Enterprises Statement of Owner's Equity For Year Ended December 31, 20 --
J. B. Gray, capital, January 1, 20--		$87,561
Net income for the year	$27,058
Less withdrawals for the year	11,120
Increase in capital		15,938
J. B. Gray, capital, December 31, 20--		103,499

Jackson Enterprises Balance Sheet December 31, 20 --
Assets
Current assets:
Cash		$20,322
Accounts receivable		18,808
Merchandise inventory		28,361
Supplies		1,384
Prepaid insurance		892
Total current assets			$69,767
Property, plant, and equipment:
Building	$89,240
Less accumulated depreciation-building	28,080	$61,160
Equipment	$34,412
Less accumulated depreciation-equipment	7,730	26,682
Total property, plant, and equipment			87,842
Total assets			$157,609
Liabilities
Current liabilities:
Accounts payable	$12,756
Wages payable	570
Sales tax payable	1,234
Mortgage payable (current portion)	820
Total current liabilities		$15,380
Long-term liabilities:
Mortgage payable	$39,550
Less current portion	820	38,730
Total liabilities			$54,110
Owner's Equity
J. B. Gray, capital			103,499
Total liabilities and owner's equity			$157,609

1. Based on the financial statements for Jackson Enterprises (income statement, statement of owners equity, and balance sheet) shown below, prepare the following financial ratios. All sales are credit sales. The Accounts Receivable balance on January 1, 20--, was $21,156. Assume 365 days per year. If required, round your answers to two decimal places. For return on owner's equity, enter as a percent but do not include percent sign.

Round average number of days answers to one decimal place.

Jackson Enterprises
December 31, 20--
Working capital:
Current ratio:		to 1
Quick ratio:		to 1
Return on owner's equity:
Accounts receivable turnover:
Average number of days required to collect receivables
Inventory turnover:
Average number of days required to sell inventory