Twenty metrics of liquidity, Solvency, and Profitability The comparative financial statements of Automotive Solutions Inc. are as 20Y8. market price of Automotive Solutions Inc. common stock was $119.70 on December 2017 $ 9,400,000 AUTOMOTIVE SOLUTIONS INC. Comparative Income Statement For the Years Ended December 31, 2048 and 2047 2048 Sales $10,000,000 Cost of goods sold (5,350,000) Gross profit $ 4,650,000 Selling expenses $(2,000,000) Administrative expenses (1,500,900) Total operating expenses $ (3,500,000) (4,950,000) $ 4,450,000 $(1,880,000) (1,410,000) $(3,290,000) Operating income $ 1,150,000 $ 1,160,000 Other revenue and expense: Other revenue 140,000 Other expense (interest) 150,000 (170,000) (150,000) Income before income tax Income tax expense $ 1,130,000 (230,000) 1,150,000 (225,000) Net Income $ 900,000 $ 925,000 Check My Work AUTOMOTIVE SOLUTIONS INC. Comparative Statement of Stockholders' Equity For the Years Ended December 31, 2018 and 2017 2018 2017 Retained Preferred Stock Common Stock Retained Earnings Preferred Stock Common Stock Earnings Balances, Jan. 1 $500,000 $500,000 $500,000 $500,000 $4,545,000 $5,375,000 900,000 Net income 925,000 Dividends: Preferred stock (45,000) (45,000) (50,000) Common stock Balances, Dec. 31 (50,000) $6,180,000 $500,000 $500,000 $500,000 $500,000 $5,375,000 AUTOMOTIVE SOLUTIONS INC. Comparative Balance Sheet December 31, 2018 and 2017 Dec. 31, 2048 Dec. 31, 2017 Assets Current assets: Cash $ 400,000 Marketable securities 1,000,000 Accounts receivable (net) Inventories $ 500,000 1,010,000 740,000 ,190,000 250,000 $3,690,000 2,350,000 3,740,000 $9,780,000 510,000 950,000 229,000 Prepaid expenses Total current assets Long-term investments $3,089,000 2,300,000 3,366,000 $8,755,000 Property, plant, and equipment (net) Total assets Liabilities Current liabilities $ 900,000 $ 880,000 Long-term liabilities: Mortgage note payable, 10% $ 0 Bonds payable, 10% $ 200,000 1,500,000 $1,700,000 $2,600,000 Total long-term liabilities 1,500,000 $1,500,000 $2,380,000 Total liabilities eBook Calculator Stockholders' Equity Preferred $0.90 stock, $10 par $ 500,000 $500,000 Common stock, $5 par 500,000 500,000 Retained earnings 6,180,000 5,375,500 Total stockholders' equity $7,180,000 $9,780,000 $6,375,000 $8,755,000 Total liabilities and stockholders' equity Instructions: Determine the following measures for 20Y8. Round ratio values to one decimal place and dollar amounts to the nearest cent. For number of days' sales in receivables and number of days' sales in inventory, round Intermediate calculations to the nearest whole dollar and final amounts to one decimal Assume there are 365 days in the year 1. Working capital 2.790.000 2. Current ratio 3. Quick ratio 4. Accounts receivable turnover 5. Days' sales in receivables 6. Inventory turnover 7. Days' sales in inventory 8. Debt ratio 9. Ratio of abilities to stockholders' equity 10. Ratio of fixed assets to long-term liabilities Check My Work Previous 6. Inventory turnover 7. Days' sales in Inventory days % 8. Debt ratio 73 26.6 0.4 2.2 9. Ratio of liabilities to stockholders' equity 10. Ratio of fixed assets to long-term liabilities 11. Times interest earned 7.6 20 times times 12. Times preferred dividends earned 13. Asset turnover 2.8 14. Return on total assets 11.5 15. Return on stockholders' equity 13.3 16. Return on common stockholders' equity 1.63 X 17. Earnings per share on common stock 8.55 18. Price-earnings ratio 0.51x 19. Dividends per share of common stock 0.5 20. Dividend yield Feedback Check My Work 1. Subtract current liabilities from current assets. Check My Work