Question
Using the financial data provided on Kotler Incorporation, calculate the following financial ratios: Inventory turnover in days Acid-test (quick) ratio Times interest earned Book Value
Using the financial data provided on Kotler Incorporation, calculate the following financial ratios:
- Inventory turnover in days
- Acid-test (quick) ratio
- Times interest earned
- Book Value per Share
- Gross Margin percentage
The financial statements of Kotler Incorporation are found below. In addition, account balances at the beginning of the year were as follows:
Accounts Receivable - $25,000; Inventory - $60,000.All sales were on account.
Kotler Incorporated Balance Sheet as at December 31, XX
ASSETS
Cash $6500
Accounts Receivable, net $35000
Merchandise Inventory $70000
Prepaid Expenses $3500
Total Current Assets $115000
Noncurrent Assets:
Property, Plant & Equipment $185000
TOTAL ASSETS $300,000
LIABILITIES
Current Liabilities
Accounts Payable $50000
Bonds Payable, 10% $80000
Total Liabilities $130,000
Shareholder's Equity:
Common Shares. $30000
Retained Earnings $140,000
Total Shareholders Equity $170,000
Total Liabilities & Equity $300,000
Kotler Incorporated Income Statement for the Year ended December 31, XX
Sales $420,000
Less: COGS $292,500
Gross Margin $127,500
Less: Operating Expenses $89,500
Net Operating Income $38,000
Interest Expense $8,000
Net Income before Taxes $30,000
Income Taxes (30%) $9,000
Net Income before taxes $21,000
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