Sprague Company has been operating for several years, and on December 31, 2008, presented the following balance
Question:
The net income for 2008 was $25,000. Assume that total assets are the same in 2007 and 2008.
Instructions
Compute each of the following ratios. For each of the four indicate the manner in which it is computed and its significance as a tool in the analysis of the financial soundness of the company.
(a) Current ratio.
(b) Acid-test ratio.
(c) Debt to total assets.
(d) Rate of return onassets.
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Related Book For
Intermediate Accounting principles and analysis
ISBN: 978-0471737933
2nd Edition
Authors: Terry d. Warfield, jerry j. weygandt, Donald e. kieso
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