Question
Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year
Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $47,900; total assets, $229,400; common stock, $89,000; and retained earnings, $29,311.)
CABOT CORPORATION Income Statement For Current Year Ended December 31 | |||
Sales | $ | 450,600 | |
Cost of goods sold | 297,350 | ||
Gross profit | 153,250 | ||
Operating expenses | 98,900 | ||
Interest expense | 4,800 | ||
Income before taxes | 49,550 | ||
Income tax expense | 19,961 | ||
Net income | $ | 29,589 | |
CABOT CORPORATION Balance Sheet December 31 | |||||||
Assets | Liabilities and Equity | ||||||
Cash | $ | 18,000 | Accounts payable | $ | 19,500 | ||
Short-term investments | 8,600 | Accrued wages payable | 2,800 | ||||
Accounts receivable, net | 30,400 | Income taxes payable | 3,000 | ||||
Merchandise inventory | 30,150 | Long-term note payable, secured by mortgage on plant assets | 67,400 | ||||
Prepaid expenses | 3,150 | Common stock | 89,000 | ||||
Plant assets, net | 150,300 | Retained earnings | 58,900 | ||||
Total assets | $ | 240,600 | Total liabilities and equity | $ | 240,600 | ||
Required: Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory, (6) debt-to-equity ratio, (7) times interest earned, (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return
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