Question
Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2012, were inventory, $52,900; total
Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2012, were inventory, $52,900; total assets, $259,400; common stock, $100,000; and retained earnings, $52,548.) CABOT CORPORATION Income Statement For Year Ended December 31, 2013 Sales $ 448,600 Cost of goods sold 297,350 Gross profit 151,250 Operating expenses 99,300 Interest expense 4,900 Income before taxes 47,050 Income taxes 18,954 Net income $ 28,096 CABOT CORPORATION Balance Sheet December 31, 2013 Assets Liabilities and Equity Cash $ 12,000 Accounts payable $ 22,500 Short-term investments 9,200 Accrued wages payable 3,600 Accounts receivable, net 33,400 Income taxes payable 4,600 Notes receivable (trade)* 5,000 Long-term note payable, secured Merchandise inventory 34,150 by mortgage on plant assets 62,400 Prepaid expenses 2,850 Common stock 100,000 Plant assets, net 154,300 Retained earnings 57,800 Total assets $ 250,900 Total liabilities and equity $ 250,900 * 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. (Use 365 days a year. Do not round intermediate calculations.)
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