Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The condensed financial statements of Ness Company for the years 2016 and 2017 are presented below. NESS COMPANY Balance Sheets December 31 (in thousands) 2017

The condensed financial statements of Ness Company for the years 2016 and 2017 are presented below. NESS COMPANY Balance Sheets December 31 (in thousands) 2017 2016 Current assets Cash and cash equivalents $330 $360 Accounts receivable (net) 470 400 Inventory 460 390 Prepaid expenses 130 160 Total current assets 1,390 1,310 Property, plant, and equipment (net) 410 380 Investments 10 10 Intangibles and other assets 530 510 Total assets $2,340 $2,210 Current liabilities $820 $790 Long-term liabilities 480 380 Stockholders equitycommon 1,040 1,040 Total liabilities and stockholders equity $2,340 $2,210 NESS COMPANY Income Statements For the Year Ended December 31 (in thousands) 2017 2016 Sales revenue $3,800 $3,460 Costs and expenses Cost of goods sold 970 890 Selling & administrative expenses 2,400 2,330 Interest expense 10 20 Total costs and expenses 3,380 3,240 Income before income taxes 420 220 Income tax expense 168 88 Net income $ 252 $ 132 Compute the following ratios for 2017 and 2016. (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 December 31, 2015, was $340.) (c) Profit margin. (d) Return on assets. (Assets on December 31, 2015, were $1,900.) (e) Return on common stockholders equity. (Equity on December 31, 2015, was $900.) (f) Debt to assets ratio. (g) Times interest earned.

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

Management Audits For Excellence

Authors: Dorsey J. Talley

1st Edition

0873890396, 978-0873890397

More Books

Students also viewed these Accounting questions

Question

c. What were you expected to do when you grew up?

Answered: 1 week ago

Question

4. Describe how cultural values influence communication.

Answered: 1 week ago

Question

3. Identify and describe nine cultural value orientations.

Answered: 1 week ago