Question

The balance sheet and income statement for the J. P. Robard Mfg. Company are as follows:
J. P. Robard Mfg., Inc.
Balance Sheet ($000)
Cash .......................... $ 500
Accounts receivable ................... 2,000
Inventories ................................. 1,000
Current assets ............................ 3,500
Net fixed assets ........................ . 4,500
Total assets ................................ $8,000
Accounts payable ............................... $1,100
Accrued expenses ............................... 600
Short-term notes payable ................... 300
Current liabilities ............................... $2,000
Long-term debt ................................. 2,000
Owners’ equity ................................. 4,000
Total liabilities and owners’ equity ........ $8,000
J. P. Robard Mfg., Inc.
Income Statement ($000)
Net sales (all credit) .......................... $8,000
Cost of goods sold ............................ (3,300)
Gross profit ....................................... $4,700
Operating expenses (includes $500 depreciation).. (3,000)
Net operating income ....................... $1,700
Interest expense ............................... (367)
Earnings before taxes ....................... $1,333
Income taxes (40%) ......................... (533)
Net income ....................................... $ 800
Calculate the following ratios:
Current ratio ..................... Operating return on assets
Times interest earned........ Debt ratio
Inventory turnover .......... Average collection period
Total asset turnover ......... Fixed asset turnover
Operating profit margin ........ Return on equity



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  • CreatedOctober 31, 2014
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