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, $179,400; common stock, $87,000; and retained earnings, $38,432.) CABOT CORPORATION Balance Sheet December 31 of current year Assets Cash Short-term investments Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Liabilities and Equity $ 12,000 Accounts payable 9,400 Accrued wages payable 31,400 Income taxes payable 40,150 Long-term note payable, secured by mortgage on plant assets 2,550 150,300 Common stock Retained earnings Total assets $ 245,800 Total liabilities and equity CABOT CORPORATION Income Statement For Current Year Ended December 31 $ 18,500 3,800 3,900 64,400 87,000 68,200 $ 245,800 Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income tax expense Net income Required: $ 451,600 297,750 153,850 99,300 4,700 49,850 20,082 $ 29,768 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) Numerator: Current Ratio Denominator: (2) Acid-Test Ratio Numerator: Denominator: Req 1 and 2 II = = II = = Current Ratio Current ratio to 1 Acid-Test Ratio Acid-Test Ratio to 1 Req 3 > Compute the days' sales uncollected. (3) Numerator: Days' Sales Uncollected Denominator: < Req 1 and 2 x x Days = Days Sales Uncollected Req 4 > = = Days sales uncollected days Compute the inventory turnover. (4) Numerator: Inventory Turnover Denominator: = Inventory Turnover = Inventory turnover = times < Req 3 Req 5 > Compute the days' sales in inventory. (5) Days' Sales in Inventory Numerator: Denominator: Days = Days' Sales in Inventory = Days' sales in inventory = days < Req 4 Req 6 > Compute the debt-to-equity ratio. (6) Numerator: Debt-to-Equity Ratio Denominator: = Debt-to-Equity Ratio = Debt-to-equity ratio = to 1 Req 5 Req 7 > Compute the times interest earned. (7) Numerator: Times Interest Earned + + Denominator: = Times Interest Earned = Times interest earned = times Req 6 Req 8 Compute the profit margin ratio. (8) Numerator: Profit Margin Ratio Denominator: = Profit margin ratio = Profit margin ratio = II < Req 7 Req 9 > % Compute the total asset turnover. (9) Numerator: Total Asset Turnover Denominator: I = Total Asset Turnover = II = Req 8 Req 10 Total asset turnover times Compute the return on total assets. (10) Numerator: 1 Return on Total Assets Denominator: = Return on Total Assets = Return on total assets = % Req 9 Req 11 > Compute the return on equity. (11) Numerator: Return on Equity Denominator Req 10 = = || Req 11 Return On Equity Return on equity %