Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 1 2 - 4 B ( Algo ) Calculate risk ratios ( LO 1 2 - 3 ) The following income statement and balance

Problem 12-4B (Algo) Calculate risk ratios (LO12-3)
The following income statement and balance sheets for The Athletic Attic are provided.
THE ATHLETIC ATTIC
Income Statement
For the Year Ended December 31,2024
Net sales $8,790,000
Cost of goods sold 5,395,000
Gross profit 3,395,000
Expenses:
Operating expenses $1,545,000
Depreciation expense 199,000
Interest expense 39,000
Income tax expense 349,000
Total expenses 2,132,000
Net income $1,263,000
THE ATHLETIC ATTIC
Balance Sheets
December 31
20242023
Assets
Current assets:
Cash $153,000 $203,000
Accounts receivable 735,000755,000
Inventory 1,350,0001,020,000
Supplies 99,00074,000
Long-term assets:
Equipment 1,095,0001,095,000
Less: Accumulated depreciation (398,000)(199,000)
Total assets $3,034,000 $2,948,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $104,000 $80,000
Interest payable 03,900
Income tax payable 34,50029,900
Long-term liabilities:
Notes payable 490,000490,000
Stockholders' equity:
Common stock 590,000590,000
Retained earnings 1,815,5001,754,200
Total liabilities and stockholders equity $3,034,000 $2,948,000
Required:
Assuming that all sales were on account, calculate the following risk ratios for 2024.(Use 365 days a year. Round your final answers to 1 decimal place.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting An Introduction

Authors: Eddie McLaney, Peter Atrill

3rd Edition

0273688227, 978-0273688228

More Books

Students also viewed these Accounting questions

Question

Describe Humes general approach to the problem of causality.

Answered: 1 week ago