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, $48,900; total assets, $189,400; common stock, $90,000; and retained earnings, $33,748.) CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 448,600 Cost of goods sold 297,250 Gross profit 151,350 Operating expenses 98,600 Interest expense 4,100 Income before taxes 48,650 Income tax expense 19,598 Net income $ 29,052 Assets Cash Short-term investments Accounts receivable, net Merchandise inventory CABOT CORPORATION Balance Sheet December 31 Liabilities and Equity $ 10,000 Accounts payable 8, 400 Accrued wages payable 33,700 Income taxes payable 32,150 Long-term note payable, secured by mortgage on plant assets 2,650 Common stock 153,300 Retained earnings $ 240,200 Total liabilities and equity $ 17,500 3,200 3,300 63,400 Prepaid expenses Plant assets, net Total assets 90,000 62,800 $ 240,200 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 common stockholders' equity. (Do not round intermediate calculations.) Compute the current ratio and acid-test ratio. (1) Current Ratio Choose Numerator: 1 Choose Denominator: = Current Ratio Current assets Current liabilities = Current Ratio II 0 to 1 (2) Acid-Test Ratio Choose Numerator: Choose Denominator: II Acid-Test Ratio Acid-Test Ratio / = 0 to 1 Reg 1 and 2 Req3 > Compute the days' sales uncollected. (3) Days' Sales Uncollected Choose Denominator: Days Choose Numerator: Days Sales Uncollected X = Days Sales Uncollected - = 0 days Req 1 and 2 Req4 Compute the inventory turnover. (4) Inventory Turnover Choose Numerator: Choose Denominator: Inventory Turnover Inventory Turnover = 0 times Req3 Req 5 > Compute the days' sales in inventory. Req 5 15) Days' Sales in Inventory Choose Denominator: Days Choose Numerator: 1 X Days' Sales in Inventory Days' Sales in Inventory 0 days = Req 4 Req 6 Compute the debt-to-equity ratio. (6) Debt-to-Equity Ratio Choose Denominator: Choose Numerator: / = Debt-to-Equity Ratio Debt-to-Equity Ratio oto 1 = Compute the profit margin ratio. (8) Profit Margin Ratio Choose Denominator: Choose Numerator: / / Profit margin ratio Profit margin ratio = - = 0 % Req 7 Req 9 > Compute the total asset turnover. (9) Total Asset Turnover Choose Numerator: Choose Denominator: Total Asset Turnover = Total Asset Turnover / 1 = O times (10) Return on Total Assets Choose Numerator: Choose Denominator: Return on Total Assets Return on Total Assets 1 = 0 % Req 9 Req 11 (11) Return on Common Stockholders' Equity Choose Numerator: Choose Denominator II / II Return On Common Stockholders' Equity Return On Common Stockholders' Equity 0 % II Reg 10 Reg 11 >