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Great Adventures Problem AP12-1

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Income statement and balance sheet data for Great Adventures, Inc., are provided below.

GREAT ADVENTURES, INC.
Income Statement
For the year ended December 31, 2022
Net sales revenues				$	187,140
Interest revenue					340
Expenses:
Cost of goods sold	$	39,600
Operating expenses		64,820
Depreciation expense		18,350
Interest expense		9,528
Income tax expense		15,600
Total expenses					147,898
Net income				$	39,582

GREAT ADVENTURES, INC.
Balance Sheets
December 31, 2022 and 2021
	2022		2021
Assets
Current assets:
Cash	$	274,574			$	64,720
Accounts receivable		49,580				0
Inventory		9,200				0
Other current assets		1,120				5,380
Long-term assets:
Land		720,000				0
Buildings		855,000				0
Equipment		84,660				51,000
Accumulated depreciation		(27,450	)			(8,550	)
Total assets	$	1,966,684			$	112,550
Liabilities and Stockholders Equity
Current liabilities:
Accounts payable	$	23,000			$	3,240
Interest payable		1,300				860
Income tax payable		15,600				14,220
Other current liabilities		27,600				0
Notes payable (current)		70,239				0
Notes payable (long-term)		678,653				32,200
Stockholders equity:
Common stock		142,000				27,480
Paid-in capital		1,104,200				0
Retained earnings		60,092				34,550
Treasury stock		(156,000	)			0
Total liabilities and stockholders equity	$	1,966,684			$	112,550

As you can tell from the financial statements, 2022 was an especially busy year. Tony and Suzie were able to use the money received from borrowing and the issuance of stock to buy land and begin construction of cabins, dining facilities, ropes course, and the outdoor swimming pool. They even put in a baby pool to celebrate the birth of their first child.

Great Adventures Problem AP12-1 Part 2

2. Calculate the following profitability ratios for 2022. (Use 365 days in a year. Round your intermediate calculations and final answers to 1 decimal place.)

\begin{tabular}{|c|l|l|l|} \hline & & \\ \hline a. & Gross profit ratio. (Hint: Use net sales revenues) & % \\ \hline b. & Return on assets. & % \\ \hline c. & Profit margin. (Hint: Use net sales revenues) & % \\ \hline d. & Asset turnover. (Hint: Use net sales revenues) & & times \\ \hline e. & Return on equity. & % \\ \hline \end{tabular}