Question
Refer to Exhibits A and B below to answer the questions that follow. Exhibit A Jordan Corporation Balance Sheet September 30, 2015 Assets Current Assets
Refer to Exhibits A and B below to answer the questions that follow.
Exhibit A Jordan Corporation Balance Sheet September 30, 2015
Assets
Current Assets (in dollars)
Cash: 500,000
Accounts receivable: 600,000
Inventory: 950,000
Prepaid expenses: 50,000
Total Current Assets:2,100,000
Property, Plant and Equipment (in dollars)
Land: 250,000
Buildings, net of depreciation: 300,000
Equipment, net of depreciation: 800,000
Total Property, Plant and Equipment: 1,350,000
Total Assets: 3,450,000
Liabilities (in dollars)
Current Liabilities
Accounts payable: 700,000
Wages payable: 200,000
Interest payable: 25,000
Total Current Liabilities: 925,000
Long Term Liabilities
Notes Payable: 500,000
Bonds Payable: 450,000
Long Term Liabilities: 950,000
Total Liabilities: 1,875,000
Shareholders' Equity (in dollars)
Common stock: 500,000
Additional paid in capital: 100,000
Retained earnings: 975,000
Total Shareholder equity: 1,575,000
Total Liabilities and Equity: 3,450,000
Exhibit B Jordan Corporation Statement of Operations Year Ended September 30, 2015
All figures in dollars
Sales: 6,000,000
Cost of goods sold: 3,600,000
Gross margin: 2,400,000
Selling and administrative expenses: 1,950,000
Operating income: 450,000
Interest expense: 50,000
Income before taxes: 400,000
Income taxes: 100,000
Net income: 300,000
Classify each of the above below as a liquidity, asset management, financial leverage or profitability measure.
Quick (Acid Test) ratio
Current ratio
Accounts payable period
Collection period
Inventory turnover
Total debt to total assets
Interest coverage
Operating income margin
Net income margin
Return on assets
Return on equity
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started