In Class Activity: Use Northeast Art Supply's Income Statement and Balance Sheet rom your text, I have told you which statement to find the number: KEY: (IS) = Income Statement (BS) = Balance Sheet 1. Measuring a Firm's ability to earn profits Return on Sales Net income after Taxes (IS) =$_ Net Sales (IS) $ 2. Meauring a Firm's ability to pay debts Current Ratio = Current Assets (BS) = $. Current Liabilities (BS) $ 3. Measuring a well a firm manages inventory times per year Inventory Turnover = Cost of Goods Sold (IS) - S. Average Inventory (LS) $ *Average Inventory - Beginning Inventory + Ending Inventory NORTHEAST ART SUPPLY, INC. Balance Sheet December 31, 2004 ASSETS LIABILITIES AND STOCKHOLDERS' EQUITY Current sites Accounts payable Notes payable Salarios payable Taxe payable Total current tables $ 35,000 25.675 4.000 $70,000 Current assets Cash $ 59.000 Marketable securities 10,000 Accounts receivable $ 40.000 Less towance for doubtful accounts 2.000 38.000 Notes related 32.000 Merchandise inventory 41.000 Prepaid expenses 2.000 Total current assets Paxed assets Dobrym $110.000 Las accumulated depreciation 20,000 $30,000 Furniture and store equipment 562.000 Lass accumulated depreciation 15,000 47.000 Total fled assets $182.000 Long-term abilities Mortgage payable on store opment $40.000 Total long-term biti $ 40.000 TOTAL LIABILITIES $110.000 137.000 Stockholders Common stock 8.000.00 Retained earnings $ 150.000 30.000 $ 25,000 Intangible assets Patents Total intangibles TOTAL ASSETS 21.000 TOTAL OWNERS' EQUITY 1540.000 TOTAL LIABILMES AND OWNERS EOUITY 230.000 $340.000 In Class Activity: Use Northeast Art Supply's Income Statement and Balance Sheet rom your text, I have told you which statement to find the number: KEY: (IS) = Income Statement (BS) = Balance Sheet 1. Measuring a Firm's ability to earn profits Return on Sales Net income after Taxes (IS) =$_ Net Sales (IS) $ 2. Meauring a Firm's ability to pay debts Current Ratio = Current Assets (BS) = $. Current Liabilities (BS) $ 3. Measuring a well a firm manages inventory times per year Inventory Turnover = Cost of Goods Sold (IS) - S. Average Inventory (LS) $ *Average Inventory - Beginning Inventory + Ending Inventory NORTHEAST ART SUPPLY, INC. Balance Sheet December 31, 2004 ASSETS LIABILITIES AND STOCKHOLDERS' EQUITY Current sites Accounts payable Notes payable Salarios payable Taxe payable Total current tables $ 35,000 25.675 4.000 $70,000 Current assets Cash $ 59.000 Marketable securities 10,000 Accounts receivable $ 40.000 Less towance for doubtful accounts 2.000 38.000 Notes related 32.000 Merchandise inventory 41.000 Prepaid expenses 2.000 Total current assets Paxed assets Dobrym $110.000 Las accumulated depreciation 20,000 $30,000 Furniture and store equipment 562.000 Lass accumulated depreciation 15,000 47.000 Total fled assets $182.000 Long-term abilities Mortgage payable on store opment $40.000 Total long-term biti $ 40.000 TOTAL LIABILITIES $110.000 137.000 Stockholders Common stock 8.000.00 Retained earnings $ 150.000 30.000 $ 25,000 Intangible assets Patents Total intangibles TOTAL ASSETS 21.000 TOTAL OWNERS' EQUITY 1540.000 TOTAL LIABILMES AND OWNERS EOUITY 230.000 $340.000