Question
xThe balance sheet and income statement shown below are for Samson Inc. Note that the firm has no amortization charges, it does not lease any
xThe balance sheet and income statement shown below are for Samson Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over. Balance Sheet (Millions of $) Assets 2020 Cash and securities $4,200 Accounts receivable 17,500 Inventories 20,300 Total current assets $42,000 Net plant and equipment $28,000 Total assets $70,000 Liabilities and Equity Accounts payable $22,509 Accruals 14,391 Notes payable 6,000 Total current liabilities $42,900 Long-term bonds $11,000 Total liabilities $53,900 Common stock $3,542
Retained earnings
12,558
Total common equity
$16,100
Total liabilities and equity
$70,000
Income Statement (Millions of $) 2020Net sales
$105,000
Operating costs except depreciation
97,650
Depreciation
2,100
Earnings before interest and taxes (EBIT)
$5,250
Less interest
1,020
Earnings before taxes (EBT)
$4,230
Taxes
1,058
Net income
$2,538
Other data: Shares outstanding (millions)
500.00
Common dividends (millions of $)
$888.30
Int rate on notes payable & L-T bonds
6%
Federal plus state income tax rate
40%
Year-end stock price
$60.91
Refer to Exhibit 4.1. What is the firm's current ratio? Do not round your intermediate calculations.
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