Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The condensed financial statements of Oriole Company for the years 2019 and 2020 are presented as follows. (Amounts in thousands.) ORIOLE COMPANY Balance Sheets December

The condensed financial statements of Oriole Company for the years 2019 and 2020 are presented as follows. (Amounts in thousands.)

ORIOLE COMPANY Balance Sheets December 31

2020

2019

Current assets
Cash and cash equivalents

$330

$360

Accounts receivable (net)

660

590

Inventory

600

530

Prepaid expenses

120

160

Total current assets

1,710

1,640

Investments

200

200

Property, plant, and equipment

420

380

Intangibles and other assets

530

510

Total assets

$2,860

$2,730

Current liabilities

$1,090

$980

Long-term liabilities

550

520

Stockholders equitycommon

1,220

1,230

Total liabilities and stockholders equity

$2,860

$2,730

ORIOLE COMPANY Income Statements For the Years Ended December 31

2020

2019

Sales revenue

$3,940

$3,600

Costs and expenses
Cost of goods sold

1,145

1,080

Selling & administrative expenses

2,400

2,330

Interest expense

25

20

Total costs and expenses

3,570

3,430

Income before income taxes

370

170

Income tax expense

111

51

Net income

$ 259

$ 119

Compute the following ratios for 2020 and 2019. (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 12/31/18, was $360.)
(c) Profit margin.
(d) Return on assets. (Assets on 12/31/18, were $2,290.)
(e) Return on common stockholders equity. (Stockholders equity on 12/31/18, was $980.)
(f) Debt to assets ratio.
(g) Times interest earned.

2020

2019

(a) Current ratio

:1

:1
(b) Inventory turnover

times

times
(c) Profit margin

%

%
(d) Return on assets

%

%
(e) Return on common stockholders equity

%

%
(f) Debt to assets ratio

%

%
(g) Times interest earned

times

times

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

Fundamental Financial Accounting Concepts Paperback By Edmonds Thomas P O

Authors: Thomas P. Edmonds, Christopher Edmonds, Mark A. Edmonds, Jennifer Edmonds, Philip R. Olds

11th Edition

9781264266234, 1264266235

More Books

Students also viewed these Accounting questions

Question

Describe new developments in the design of pay structures. page 475

Answered: 1 week ago