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, $51,900; total assets, $199,400; common stock, $88,000; and retained earnings, $38,568.)

CABOT CORPORATION
Balance Sheet
December 31 of current year
Assets		Liabilities and Equity
Cash	$ 16,000	Accounts payable	$ 15,500
Short-term investments	8,200	Accrued wages payable	4,600
Accounts receivable, net	31,800	Income taxes payable	3,900
Merchandise inventory	40,150	Long-term note payable, secured by mortgage on plant assets	69,400
Prepaid expenses	2,600	Common stock	88,000
Plant assets, net	152,300	Retained earnings	69,650
Total assets	$ 251,050	Total liabilities and equity	$ 251,050

CABOT CORPORATION
Income Statement
For Current Year Ended December 31
Sales	$ 453,600
Cost of goods sold	298,450
Gross profit	155,150
Operating expenses	99,200
Interest expense	3,900
Income before taxes	52,050
Income tax expense	20,968
Net income	$ 31,082

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 on equity. (Do not round intermediate calculations.)

Complete this question by entering your answers in the tabs below.

• Req 1 and 2
• Req 3
• Req 4
• Req 5
• Req 6
• Req 7
• Req 8
• Req 9
• Req 10
• Req 11

Compute the current ratio and acid-test ratio.

(1)	Current Ratio
	Numerator:	/	Denominator:	=	Current Ratio
	Current assets	/	Current liabilities	=	Current ratio
	$	/	$	=	4.1	to 1
(2)	Acid-Test Ratio
	Numerator:	/	Denominator:	=	Acid-Test Ratio
	Quick assets	/	Current liabilities	=	Acid-Test Ratio
	$	/		=	0	to 1