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Required information [The following information applies to the questions displayed below.] Income statements and balance sheets data for Virtual Gaming Systems are provided below. VIRTUAL
Required information [The following information applies to the questions displayed below.] Income statements and balance sheets data for Virtual Gaming Systems are provided below. VIRTUAL GAMING SYSTEMS Income Statements For the years ended December 31 2022 2021 Net sales $3,545,000 $3,071,000 Cost of goods sold 2,487,000 1,957,000 Gross profit 1,058,000 1,114,000 Expenses: Operating expenses 962,000 865,000 Depreciation expense 37,000 30,500 Loss on sale of land 0 8,700 Interest expense 21,500 18,500 Income tax expense 8,700 51,500 Total expenses 1,029,200 974,200 Net income $ 28,800 $ 139,800 VIRTUAL GAMING SYSTEMS Balance Sheets December 31 2022 2021 2020 211,500 85,500 135,500 14,700 $ 193,000 88,000 112,000 12,700 $151,000 67,000 142,000 6,840 0 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investment in bonds Land Equipment Less: Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings Total liabilities and stockholders' equity 112,000 307,000 307,000 (116,500) $1,056,700 112,000 217,000 277,000 (79,500) $932,200 247,000 217,000 (49,000) $781,840 $ 132,600 11,100 12,700 $ 73,000 7,400 18,500 $129,940 3,700 14,700 470,000 292,000 232,000 307,000 123,300 $1,056,700 307,000 234,300 $932,200 307,000 94,500 $781,840 2. Calculate the following profitability ratios for 2021 and 2022: (Round your answers to 1 decimal place.) 2021 2022 Gross profit ratio % Return on assets % Profit margin % Asset turnover times times
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