Twenty metrics of liquidity,Solvency, andProfitability<\/p>
The comparative financial statements of Automotive Solutions Inc. are as follows. The market price of Automotive Solutions Inc. common stock was $52 on December 31, 20Y8.<\/p>
AUTOMOTIVE SOLUTIONS INC.<\/strong><\/p> Comparative Income Statement<\/strong><\/p> For the Years Ended December 31, 20Y8 and 20Y7<\/strong>20Y8<\/strong>20Y7<\/strong>Sales$1,252,680$1,154,130Cost of goods sold(520,490)(478,850)Gross profit$732,190$675,280Selling expenses$(228,610)$(290,520)Administrative expenses(194,740)(170,630)Total operating expenses(423,350)(461,150)Operating income$308,840$214,130Other revenue and expense:Other income16,26013,670Other expense (interest)(96,000)(52,800)Income before income tax$229,100$175,000Income tax expense(27,500)(21,100)Net income$201,600$153,900<\/p> <\/p> AUTOMOTIVE SOLUTIONS INC.<\/strong><\/p> Comparative Statement of Stockholders' Equity<\/strong><\/p> For the Years Ended December 31, 20Y8 and 20Y7<\/strong>20Y820Y7<\/strong>Preferred<\/strong><\/p> StockCommon<\/strong><\/p> StockRetained<\/strong><\/p> EarningsPreferred<\/strong><\/p> StockCommon<\/strong><\/p> StockRetained<\/strong><\/p> Earnings<\/strong>Balances, Jan. 1$200,000$230,000$881,325$200,000$230,000$751,675Net income201,600153,900Dividends:Preferred stock(7,000)(7,000)Common stock(17,250)(17,250)Balances, Dec. 31$200,000$230,000$1,058,675$200,000$230,000$881,325<\/p> <\/p> AUTOMOTIVE SOLUTIONS INC.<\/strong><\/p> Comparative Balance Sheet<\/strong><\/p> December 31, 20Y8 and 20Y7<\/strong>Dec. 31, 20Y8<\/strong>Dec. 31, 20Y7Assets<\/strong>Current assets:Cash$323,610$194,990Temporary investments489,790323,130Accounts receivable (net)248,200233,600Inventories189,800146,000Prepaid expenses61,22939,000Total current assets$1,312,629$936,720Long-term investments493,589159,971Property, plant, and equipment (net)1,320,0001,188,000Total assets$3,126,218$2,284,691Liabilities<\/strong>Current liabilities$437,543$313,366Long-term liabilities:Mortgage note payable, 8%, due in 15 years$540,000$0Bonds payable, 8%, due in 20 years660,000660,000Total long-term liabilities$1,200,000$660,000Total liabilities$1,637,543$973,366Stockholders' Equity<\/strong>Preferred $0.70 stock, $20 par$200,000$200,000Common stock, $10 par230,000230,000Retained earnings1,058,675881,325Total stockholders' equity$1,488,675$1,311,325Total liabilities and stockholders' equity$3,126,218$2,284,691<\/p> Instructions:<\/strong><\/p> Determine the following measures for 20Y8. Round ratio values to one decimal place and dollar amounts to the nearest cent. For number of days' sales in receivables and number of days' sales in inventory, round intermediate calculations to the nearest whole dollar and final amounts to one decimal place. Assume there are 365 days in the year.<\/p> <\/p> 1.<\/strong>Working capital$<\/p> 2.<\/strong>Current ratio<\/p> 3.<\/strong>Quick ratio<\/p> 4.<\/strong>Accounts receivable turnover<\/p> 5.<\/strong>Days' sales in receivables days<\/p> 6.<\/strong>Inventory turnover<\/p> 7.<\/strong>Days' sales in inventory days<\/p> 8.<\/strong>Debt ratio %<\/p> 9.<\/strong>Ratio of liabilities to stockholders' equity<\/p> 10.<\/strong>Ratio of fixed assets to long-term liabilities<\/p> 11.<\/strong>Times interest earned times<\/p> 12.<\/strong>Times preferred dividends earned times<\/p> 13.<\/strong>Asset turnover<\/p> 14.<\/strong>Return on total assets<\/p> 15.<\/strong>Return on stockholders' equity%<\/p> 16.<\/strong>Return on common stockholders' equity%<\/p> 17.<\/strong>Earnings per share on common stock$<\/p> 18.<\/strong>Price-earnings ratio<\/p> 19.<\/strong>Dividends per share of common stock$<\/p> 20.<\/strong>Dividend yield%<\/p>",
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