Taber Company has just prepared the following comparative annual Income Statement for the year ended 30 September 2020 financial statements for 2020 $110,000 (52,000) 58,000 (40,000) 18,000 (5,400) 12,600 2019 $18,000 32,000 38,000 105,000 $35,000 350 40,000 90,000 27,650 Sales revenue (half on credit) Cost of goods sold Gross profits Expenses (including $4,000 interest expense) Operating income Income tax at 30 Net income Comparative Statement of Financial Position ASSETS Cash $49,500 Accounts receivable 37,000 Inventory 25,000 Property, plant and equipment (net) LIABILITIES AND EQUITY Accounts payable Income tax payable Note payable due in 8 years Ordinary shares (par at $10 each) Retained earnings Additional information 95,000 $42,000 1,000 40,000 90,000 33,500 The market price of the ordinary shares as at 30 September 2020 is $23 Dividends declared and paid during 2020 were $6,750 Required Calculate the following ratios of the company for 2020 Show ALL workings (Round ALL answers to 2 decimal places) (a) Current ratio (b) Quick ratio (c) Inventory turnover (d) Receivableturnover (e) Times interest earned (f) Return on equity (g) Dividendyield (h) Price earningsratio Question B2 Taber Company has just prepared the following comparative annual financial statements for 2020 Income Statement for the year ended 30 September 2020 Sales revenue (half on credit) Cost of goods sold Gross profits Expenses (including $4,000 interest expense) Operating income Income tax at 30 Net income $110,000 (52,000) 58,000 (40,000) 18,000 (5,400) 12,600 Comparative Statement of Financial Position 2020 2019 ASSETS Cash Accounts receivable Inventory Property, plant and equipment (net) $49,500 37,000 25,000 95,000 $18,000 32,000 38,000 105,000 LIABILITIES AND EQUITY Accounts payable Income tax payable Note payable due in 8 years Ordinary shares (par at $10 each) Retained earnings $42,000 1,000 40,000 90,000 33,500 $35,000 350 40,000 90,000 27,650 Additional information The market price of the ordinary shares as at 30 September 2020 is $23 Dividends declared and paid during 2020 were $6,750 Required Calculate the following ratios of the company for 2020 Show ALL workings (Round ALL answers to 2 decimal places) (a) Current ratio (b) Quick ratio (c) Inventory turnover (d) Receivable turnover (e) Times interest earned (t) Return on equity (g) Dividend yield (h) Price earnings ratio

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 16, 2024

Taber Company has just prepared the following comparative annual Income Statement for the year ended 30 September 2020 financial statements for 2020: $110,000 (52,000) 58,000

Taber Company has just prepared the following comparative annual Income Statement for the year ended 30 September 2020 image text in transcribed

financial statements for 2020:

$110,000 (52,000) 58,000 (40,000) 18,000 (5,400) 12,600

2019

$18,000 32,000 38,000

105,000

$35,000 350 40,000 90,000 27,650

Sales revenue (half on credit) Cost of goods sold Gross profits Expenses (including $4,000 interest expense) Operating income

Income tax at 30% Net income

Comparative Statement of Financial Position

ASSETS Cash $49,500 Accounts receivable 37,000 Inventory 25,000

Property, plant and equipment (net)

LIABILITIES AND EQUITY Accounts payable Income tax payable Note payable due in 8 years Ordinary shares (par at $10 each) Retained earnings

Additional information:

95,000

$42,000 1,000 40,000 90,000 33,500

The market price of the ordinary shares as at 30 September 2020 is $23. Dividends declared and paid during 2020 were $6,750.

Required:

Calculate the following ratios of the company for 2020. Show ALL workings. (Round ALL answers to 2 decimal places)

(a) Current ratio
(b) Quick ratio
(c) Inventory turnover
(d) Receivableturnover
(e) Times interest earned
(f) Return on equity
(g) Dividendyield
(h) Price/earningsratio

Question B2 Taber Company has just prepared the following comparative annual financial statements for 2020: Income Statement for the year ended 30 September 2020 Sales revenue (half on credit) Cost of goods sold Gross profits Expenses (including $4,000 interest expense) Operating income Income tax at 30% Net income $110,000 (52,000) 58,000 (40,000) 18,000 (5,400) 12,600 Comparative Statement of Financial Position 2020 2019 ASSETS Cash Accounts receivable Inventory Property, plant and equipment (net) $49,500 37,000 25,000 95,000 $18,000 32,000 38,000 105,000 LIABILITIES AND EQUITY Accounts payable Income tax payable Note payable due in 8 years Ordinary shares (par at $10 each) Retained earnings $42,000 1,000 40,000 90,000 33,500 $35,000 350 40,000 90,000 27,650 Additional information: The market price of the ordinary shares as at 30 September 2020 is $23. Dividends declared and paid during 2020 were $6,750. Required: Calculate the following ratios of the company for 2020. Show ALL workings. (Round ALL answers to 2 decimal places) (a) Current ratio (b) Quick ratio (c) Inventory turnover (d) Receivable turnover (e) Times interest earned (t) Return on equity (g) Dividend yield (h) Price / earnings ratio