Question
The condensed financial statements of Blossom Company for the years 2021 and 2022 are presented as follows. (Amounts in thousands.) BLOSSOM COMPANY Balance Sheets December
The condensed financial statements of Blossom Company for the years 2021 and 2022 are presented as follows. (Amounts in thousands.)
BLOSSOM COMPANY Balance Sheets December 31 | ||||
---|---|---|---|---|
2022 | 2021 | |||
Current assets | ||||
Cash and cash equivalents | $330 | $360 | ||
Accounts receivable (net) | 670 | 600 | ||
Inventory | 500 | 430 | ||
Prepaid expenses | 120 | 160 | ||
Total current assets | 1,620 | 1,550 | ||
Investments | 210 | 210 | ||
Property, plant, and equipment (net) | 420 | 380 | ||
Intangibles and other assets | 530 | 510 | ||
Total assets | $2,780 | $2,650 | ||
Current liabilities | $1,100 | $990 | ||
Long-term liabilities | 450 | 420 | ||
Stockholders equitycommon | 1,230 | 1,240 | ||
Total liabilities and stockholders equity | $2,780 | $2,650 |
BLOSSOM COMPANY Income Statements For the Year Ended December 31 | ||||
---|---|---|---|---|
2022 | 2021 | |||
Sales revenue | $3,840 | $3,500 | ||
Costs and expenses | ||||
Cost of goods sold | 1,155 | 1,090 | ||
Selling & administrative expenses | 2,400 | 2,330 | ||
Interest expense | 25 | 20 | ||
Total costs and expenses | 3,580 | 3,440 | ||
Income before income taxes | 260 | 60 | ||
Income tax expense | 78 | 18 | ||
Net income | $ 182 | $ 42 |
Compute the following ratios for 2022 and 2021. (Round current ratio and inventory turnover to 2 decimal places, e.g. 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%.)
(a) | Current ratio. | |
(b) | Inventory turnover. (Inventory on 12/31/20 was $420.) | |
(c) | Profit margin. | |
(d) | Return on assets. (Assets on 12/31/20 were $2,370.) | |
(e) | Return on common stockholders equity. (Stockholders equity on 12/31/20 was $950.) | |
(f) | Debt to assets ratio. | |
(g) | Times interest earned. |
2022 | 2021 | |||||
---|---|---|---|---|---|---|
Current ratio. | Enter a number for Current ratio rounded to two decimal places | :1 | Enter a number for Current ratio rounded to two decimal places | :1 | ||
Inventory turnover. | Enter Inventory turnover in times rounded to two decimal places | times | Enter Inventory turnover in times rounded to two decimal places | times | ||
Profit margin. | Enter Profit margin in percentages rounded to one decimal place | % | Enter Profit margin in percentages rounded to one decimal place | % | ||
Return on assets. | Enter Return on assets in percentages rounded to one decimal place | % | Enter Return on assets in percentages rounded to one decimal place | % | ||
Return on common stockholders equity. | Enter Return on common stockholders equity in percentages rounded to one decimal place | % | Enter Return on common stockholders equity in percentages rounded to one decimal place | % | ||
Debt to assets ratio. | Enter Debt to assets ratio in percentages rounded to one decimal place | % | Enter Debt to assets ratio in percentages rounded to one decimal place | % | ||
Times interest earned. | Enter a number for Times interest earned rounded to one decimal place | times | Enter a number for Times interest earned rounded to one decimal place | times |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started