Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The condensed financial statements of Sandhill Co. for the years 2019 and 2020 are presented as follows. (Amounts in thousands.) SANDHILL CO. Balance Sheets December
The condensed financial statements of Sandhill Co. for the years 2019 and 2020 are presented as follows. (Amounts in thousands.) SANDHILL CO. Balance Sheets December 31 2020 2019 Current assets Cash and cash equivalents $330 $360 Accounts receivable (net) 550 480 500 430 Inventory 120 160 Prepaid expenses Total current assets 1,500 1,430 90 90 Investments 420 380 Property, plant, and equipment 530 510 Intangibles and other assets $2,540 $2,410 Total assets $980 $870 Current liabilities 450 420 Long-term liabilities f707 lecca894dd9947671adiqu... 1/3 Stockholders' equity-common 1,110 1,120 Total liabilities and stockholders' equity $2,540 $2,410 SANDHILL CO. Income Statements For the Years Ended December 31 2020 2019 $3,840 $3,500 1,035 970 Sales revenue Costs and expenses Cost of goods sold Selling & administrative expenses Interest expense Total costs and expenses Income before income taxes 2,400 2,330 25 20 3,460 3,320 380 180 Income tax expense 114 54 Net income $ 266 $ 126 Compute the following ratios for 2020 and 2019. (Round current ratio and inventory turnover to 2 decimal places, eg. 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 $380.) (c) Profit margin. (d) Return on assets. (Assets on 12/31/18, were $2,690.) (e) Return on common stockholders' equity. (Stockholders' equity on 12/31/18, was $920.) (f) Debt to assets ratio. (g) Times interest earned. (a) Current ratio :1 :1 (b) Inventory turnover times times (c) Profit margin de % (d) Return on assets % de le) Return on common stockholders' equity % % (f) Debt to assets ratio % % Times interest earned times 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