Question: Below are the comparative balance sheets for 2017 and 2018 as well as the income statement for 2018 for Walstead Company. 2018 2017 Income statement
Below are the comparative balance sheets for 2017 and 2018 as well as the income statement for 2018 for Walstead Company.
2018
2017
Income statement
Sales revenue
$920,000
Cost of goods sold
480,000
Gross profit
440,000
Operating expenses
150,000
Pretax income
290,000
Income tax
69,600
Net income
$220,400
Balance sheet
Cash
$26,000
$6,000
Accounts receivable (net)
40,000
38,000
Merchandise inventory
15,000
20,000
Prepaid-expenses
1000
500
Fixed assets (net)
220,000
200,000
$302,000
$264,500
Accounts payable
$17,000
$18,000
Income taxes payable
1,000
1,000
Bonds payable
90,000
100,000
Common stock
100,000
100,000
Retained earnings
94,000
45,500
$302,000
$264,500
*Assume the following.Interest expense is $8,000. The market price of stock on December 31, 2018 is $28.00.The income tax rate is 24%.The average number of shares outstanding over 2018 is 15,000 shares.
Using this information, calculate each of the following ratios (show as decimals to four places - do not show as percentages):
Profit margin
Return on assets
Return on equity
Earnings per share
Price/earnings ratio
Current ratio
Quick ratio
Acid test ratio
Debt-to-equity ratio
Accounts receivable turnover
A/R days until received
Show computations here:
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