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The following income statement and balance sheets for Virtual Gaming Systems are provided. VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2018
The following income statement and balance sheets for Virtual Gaming Systems are provided.
VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2018 | ||
Net sales | $3,071,000 | |
Cost of goods sold | 1,957,000 | |
Gross profit | 1,114,000 | |
Expenses: | ||
Operating expenses | $865,000 | |
Depreciation expense | 27,000 | |
Loss on sale of land | 8,700 | |
Interest expense | 18,500 | |
Income tax expense | 55,000 | |
Total expenses | 974,200 | |
Net income | $ 139,800 | |
VIRTUAL GAMING SYSTEMS Balance Sheets December 31 | ||
2018 | 2017 | |
Assets | ||
Current assets: | ||
Cash | $193,000 | $151,000 |
Accounts receivable | 88,000 | 67,000 |
Inventory | 112,000 | 142,000 |
Prepaid rent | 12,700 | 6,840 |
Long-term assets: | ||
Investment in bonds | 112,000 | 0 |
Land | 217,000 | 247,000 |
Equipment | 277,000 | 217,000 |
Less: Accumulated depreciation | (76,000) | (49,000) |
Total assets | $935,700 | $781,840 |
Liabilities and Stockholders' Equity | ||
Current liabilities: | ||
Accounts payable | $ 73,000 | $ 122,940 |
Interest payable | 7,400 | 3,700 |
Income tax payable | 18,500 | 14,700 |
Long-term liabilities: | ||
Notes payable | 292,000 | 232,000 |
Stockholders' equity: | ||
Common stock | 307,000 | 307,000 |
Retained earnings | 237,800 | 101,500 |
Total liabilities and stockholders equity | $935,700 | $781,840 |
Earnings per share for the year ended December 31, 2018, are $1.40. The closing stock price on December 31, 2018, is $28.00.
Required:
Calculate the following profitability ratios for 2018. (Round your answers to 1 decimal place.)
PROFITABILITY RATIOS
|
1. | Gross profit ratio | % | |
2. | Return on assets | % | |
3. | Profit margin | % | |
4. | Asset turnover | TIMES | |
5. | Return on equity | % | |
6. | Price-earnings ratio |
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