Financial statements for Gibson Company follow. GIBSON COMPANY Balance Sheets As of December 31 2019 2018 Assets Current assets $ 20,000 Cash 16,000 6,800 41,000 142,000 Marketable securities 20,800 49,000 134,000 Accounts receivable (net) Inventories Prepaid items Total current assets 13,000 218,800 25,000 280,000 24,000 $547,800 28,000 251,800 32,000 295,000 29,000 Investments Plant (net) Land $607,800 Total assets Liabilities and Stockholders' Equity Liabilities Current liabilities Notes payable $31,600 $17,700 Accounte navahle 1 Aa aaa 112 aa Check my Notes payable Accounts payable Salaries payable $31,600 113,800 23,000 17,700 100,000 17,000 134,700 Total current liabilities 168,400 Noncurrent liabilities Bonds payable 120,000 27,000 147,000 120,000 32,000 152,000 other Total noncurrent liabilities Total liabilities 320,400 281,700 Stockholders' equity Preferred stock, (par value $10, 4% cumulative, non-participating; 8,000 shares authorized and issued) Common stock (no par; 50,000 shares authorized; 10,000 shares issued) Retained earnings Total stockholders' equity 80,000 80,000 80,000 127,400 287,400 80,000 106,100 266,100 $607,800 $547,800 Total liabilities and stockholders' equity GIBSON COMPANY Statements of Income and Retained Earnings For the Years Ended December 31 KPrev Next 6 of 6 GIBSON COMPANY Statements of Income and Retained Earnings For the Years Ended December 31 2019 2018 Revenues Sales (net) $310,000 $290,000 Other revenues 9,600 6,600 319,600 Total revenues 296,600 Expenses Cost of goods sold Selling, general, and administrative 127,000 155,000 63,000 58,000 Interest expense 10,400 9,600 Income tax expense 63,000 62,000 Total expenses 256,600 291,400 Net earnings (net income) Retained earnings, January 1 40,000 73,000 3,200 3,700 28,200 106,100 3,200 3,700 Less: Preferred stock dividends Common stock dividends $127,400 $106,100 Retained earnings, December 31 Required Calculate the following ratios for 2019 and 2018. Since 2017 numbers are not presented, do not use averages when calculating the ratios for 2018. Instead, use the number presented on the 2018 balance sheet. a. Working capital. b. Current ratio. (Round your answers to 2 decimal places.) c. Quick ratio. (Round your answers to 2 decimal places.) d. Receivables turnover (beginning receivables at January 1, 2018, were $42,000). (Round your answers to 2 decimal places.) e. Average days to collect accounts receivable. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) f. Inventory turnover (beginning inventory at January 1, 2018, was $148,000). (Round your answers to 2 decimal places.) g. Number of days to sell inventory. (Round your intermediate calculations to 2 decimal places and your final answers to the nearest whole number.) h. Debt to assets ratio. (Round your answers to the nearest whole percent.) i. Debt to equity ratio. (Round your answers to 2 decimal places.) j. Number of times interest was earned. (Round your answers to 2 decimal places.) k. Plant assets to long-term debt. (Round your answers to 2 decimal places.) I. Net margin. (Round your answers to 2 decimal places.) m. Turnover of assets. (Round your answers to 2 decimal places.) n. Return on investment. (Round your answers to 2 decimal places.) o. Return on equity. (Round your answers to 2 decimal places.) p. Earnings per share. (Round your answers to 2 decimal places.) q. Book value per share of common stock. (Round your answers to 2 decimal places.) r. Price-earninas ratio (market price per share: 2018. $12.15: 2019. 13.30) (Round vour intermediate calculations and final answer to a. Working capital 83,400 84,100 $ $ b. Current ratio 1.50 1.62 c. Quick ratio 0.07 0.57 d. Receivables turnover 6.89 times 6.99 times days days e. Average days to collect accounts receivable 1.12 times 0.88 times f. Inventory turnover 326 days g. Average days to sell inventory 415 days h. Debt to assets ratio 1% 1 % i. Debt to equity ratio 1.11 1.06 11.63 times lj.Number of times interest earned 9.77 times k. Plant assets to long-term debt I. Net margin % m. Asset turnover n. Return on investment % o. Return on equity % p. Earnings per share per share per share q. Book value per share per share per share r. Price-earnings ratio s. Dividend yield %
