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The following Information is available about the company: a. Selected financial ratios computed from the statements are shown below: Current ratio 2.75 Acid-test ratio 1.25
The following Information is available about the company: a. Selected financial ratios computed from the statements are shown below: Current ratio 2.75 Acid-test ratio 1.25 Accounts receivable turnover 14.0 Inventory turnover 6.5 Debt-to-equity ratio 0. 875 Times interest earned ratio 6.75 Earnings per share $ 2.30 Return on total assets 18% b. All sales during the year were on account. c. The Interest expense on the Income statement relates to the bonds payable; the amount of bonds outstanding did not change throughout the year. d. There were no changes in the number of common shares outstanding during the year. e. Selected balances at the beginning of the current year (January 1) were as follows: Accounts receivable 270, 080 Inventory 360,808 Total assets $1, 800,080 Required: Compute the missing amounts on the company's financial statements. (Hint. You may find it helpful to think about the difference between the current ratio and the acid-test ratio.)
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