Question
Ontario Inc. reports the following financial statements for 2015: Income Statement Actual Sales revenues $300 Cost of goods sold 180 Gross profit 120 Depreciation expense
Ontario Inc. reports the following financial statements for 2015:
Income Statement | Actual |
Sales revenues | $300 |
Cost of goods sold | 180 |
Gross profit | 120 |
Depreciation expense | 20 |
Other operating expenses | 60 |
Operating income | 40 |
Interest expense | 10 |
Income before taxes | 30 |
Income tax expense | 6 |
Net income | $24 |
Earnings per share | $.25 |
Balance Sheet
Assets |
|
| Liabilities |
|
Cash | $20 |
| Current: accounts payable | $85 |
Accounts receivable | 60 |
| Long-term: bonds payable | 115 |
Inventory | 90 |
| Total liabilities | 200 |
Total current assets | 170 |
|
|
|
|
|
| Shareholders Equity |
|
Equipment, cost | 410 |
| Contributed capital | 180 |
Less: accumulated depreciation | (80) |
| Retained earnings | 120 |
Equipment, net | 330 |
| Total shareholders equity | 300 |
|
|
|
|
|
Total assets | $500 |
| Total liabilities and s/equity | $500 |
Required: Compute the following ratios for 2015:
RATIOs | Calculated RATIO |
1.Current (working capital) |
|
2.Accounts receivable turnover |
|
3.Days in accounts receivable |
|
4.Inventory turnover |
|
5.Days in inventory |
|
6.Accounts payable turnover |
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7.Days in accounts payable |
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8.Net cash conversion cycle |
|
9.Operating profit margin |
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10.Net profit margin |
|
11.Asset turnover |
|
12.Return on assets |
|
13.Return on equity |
|
14.Debt to capital |
|
15.Earnings coverage |
|
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