Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Tech Supplies Company, Incorporated, is a leading retailer specializing in consumer electronics. A condensed income statement and balance sheet for the fiscal year ended February

Tech Supplies Company, Incorporated, is a leading retailer specializing in consumer electronics. A condensed income statement and balance sheet for the fiscal year ended February 1, 2020, are shown below.

Tech Supplies Company, Incorporated
Balance Sheet
At February 1, 2020
($ in millions)
Assets
Current assets:
Cash and cash equivalents $ 2,076
Accounts receivable (net) 1,212
Inventory 5,061
Other current assets 412
Total current assets 8,761
Long-term assets 3,683
Total assets $ 12,444
Liabilities and Shareholders Equity
Current liabilities:
Accounts payable $ 4,950
Other current liabilities 3,475
Total current liabilities 8,425
Long-term liabilities 2,236
Shareholders equity 1,783
Total liabilities and shareholders equity $ 12,444
Tech Supplies Company, Incorporated
Income Statement
For the Year Ended February 1, 2020
($ in millions)
Revenues $ 39,578
Costs and expenses 38,163
Operating income 1,415
Other income (expense)* (75)
Income before income taxes 1,340
Income tax expense 653
Net income $ 687

*Footnote asteriskIncludes $170 of interest expense.

Required:

1-a. Calculate the current ratio for Tech Supplies for its fiscal year ended February 1, 2020.

1-b. Calculate the acid-test ratio for Tech Supplies for its fiscal year ended February 1, 2020.

1-c. Calculate the debt to equity ratio for Tech Supplies for its fiscal year ended February 1, 2020.

1-d. Calculate the times interest earned ratio for Tech Supplies for its fiscal year ended February 1, 2020.

Note: For all requirements, round your answers to 2 decimal places.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Auditing

Authors: Michael C. Knapp

8th edition

978-0538466790, 538466790, 978-1285066608

More Books

Students also viewed these Accounting questions

Question

What questions should you use to analyze a survey?

Answered: 1 week ago

Question

4 Is non-cash recognition simply motivation on the cheap?

Answered: 1 week ago