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Refer to the following accounting statements. Calculate the Operating Profitability of the year 2019. 2020 2019 Cash $60,000 $90,000 S-T invest. 150,000 150,000 AR 60,000
| Refer to the following accounting statements. Calculate the Operating Profitability of the year 2019. |
| | 2020 | 2019 |
| Cash | $60,000 | $90,000 |
| S-T invest. | 150,000 | 150,000 |
| AR | 60,000 | 90,000 |
| Inventories | 180,000 | 150,000 |
| Total CA | 450,000 | 480,000 |
| Gross FA | 420,000 | 420,000 |
| Less: Depr. | 40,000 | 30,000 |
| Net FA | 380,000 | 390,000 |
| Total assets | $830,000 | $870,000 |
| | 2020 | 2019 |
| Accts. payable | $90,000 | $96,000 |
| Notes payable | 90,000 | 81,000 |
| Accruals | 150,000 | 198,000 |
| Total CL | 330,000 | 375,000 |
| Long-term debt | 240,000 | 250,000 |
| Common stock | 140,000 | 140,000 |
| Ret. earnings | 120,000 | 105,000 |
| Total equity | 260,000 | 245,000 |
| Total L&E | $830,000 | $870,000 |
| | 2020 | 2019 |
| Sales | $166,320 | $158,344 |
| COGS | 38,640 | 49,800 |
| Other expenses | 34,000 | 29,000 |
| Deprec. | 10,000 | 10,000 |
| Tot. op. costs | 82,640 | 88,800 |
| EBIT | 83,680 | 69,544 |
| Int. expense | 1,540 | 1,760 |
| Pre-tax earnings | 82,140 | 67,784 |
| Taxes (40%) | 32,856 | 27,114 |
| Net income | $49,284 | $40,670 |
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