Question
The condensed financial statements of Murawski Company for the years 2019 and 2020 are presented follows. (Amounts in thousands.) MURAWSKI COMPANY Balance Sheets December 31
The condensed financial statements of Murawski Company for the years 2019 and 2020 are presented follows. (Amounts in thousands.)
MURAWSKI COMPANY Balance Sheets December 31 | ||||||
2020 | 2019 | |||||
Current assets | ||||||
Cash and cash equivalents | $ 380 | $ 365 | ||||
Accounts receivable (net) | 414 | 440 | ||||
Inventory | 410 | 464 | ||||
Prepaid expenses | 146 | 146 | ||||
Total current assets | 1,350 | 1,415 | ||||
Investments | 14 | 10 | ||||
Property, plant, and equipment | 400 | 426 | ||||
Intangibles and other assets | 492 | 540 | ||||
Total assets | $2,256 | $2,391 | ||||
Current liabilities | $ 808 | $ 884 | ||||
Long-term liabilities | 366 | 416 | ||||
Stockholders equitycommon | 1,082 | 1,091 | ||||
Total liabilities and stockholders equity | $2,256 | $2,391 |
MURAWSKI COMPANY Income Statements For the Years Ended December 31 | ||||||
2020 | 2019 | |||||
Sales revenue | $3,920 | $3,790 | ||||
Costs and expenses | ||||||
Cost of goods sold | 888 | 946 | ||||
Selling & administrative expenses | 2,300 | 2,372 | ||||
Interest expense | 20 | 23 | ||||
Total costs and expenses | 3,208 | 3,341 | ||||
Income before income taxes | 712 | 449 | ||||
Income tax expense | 180 | 85 | ||||
Net income | $ 532 | $ 364 |
Compute the following ratios for 2020 and 2019. (Round current ratio and invertory turnover ratio to 2 decimal places, e.g. 1.62 or 1.62% and all other answers to 1 decimal place, e.g. 1.6 or 1.6%.)
(a) | Current ratio. | |
(b) | Inventory turnover. (Inventory on 12/31/18 was $333.) | |
(c) | Profit margin ratio. | |
(d) | Return on assets. (Assets on 12/31/18 were $1,892.) | |
(e) | Return on common stockholders equity. (Stockholders' equity on 12/31/18 was $906.) | |
(f) | Debt to assets ratio. | |
(g) | Times interest earned. |
2020 | 2019 | |||||||
(a) | Current ratio | :1 | :1 | |||||
(b) | Inventory turnover | times | times | |||||
(c) | Profit margin ratio | % | % | |||||
(d) | Return on assets | % | % | |||||
(e) | Return on common stockholders equity | % | % | |||||
(f) | Debt to assets ratio | % | % | |||||
(g) | Times interest earned | times | times |
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