Question
Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, $55,900; total
Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, $55,900; total assets, $249,400; common stock, $87,000; and retained earnings, $40,778.) CABOT CORPORATION Income Statement For Year Ended December 31, 2017 Sales $ 453,600 Cost of goods sold 297,750 Gross profit 155,850 Operating expenses 99,000 Interest expense 4,900 Income before taxes 51,950 Income taxes 20,928 Net income $ 31,022 CABOT CORPORATION Balance Sheet December 31, 2017 Assets Liabilities and Equity Cash $ 14,000 Accounts payable $ 17,500 Short-term investments 9,000 Accrued wages payable 3,600 Accounts receivable, net 34,000 Income taxes payable 4,400 Notes receivable (trade)* 5,500 Merchandise inventory 40,150 Long-term note payable, secured by mortgage on plant assets 70,400 Prepaid expenses 2,750 Common stock 87,000 Plant assets, net 149,300 Retained earnings 71,800 Total assets $ 254,700 Total liabilities and equity $ 254,700 * These are short-term notes receivable arising from customer (trade) sales. 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.)
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