Check my work Problem 17-4A Calculating financial statement ratios LO P3 points Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $51,900; total assets, $249,400; common stock, $83,000; and retained earnings, $31,760.) eBook Print References CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 456,600 Cost of goods sold 297,650 Gross profit 158,950 Operating expenses 98,800 Interest expense 3,900 Income before taxes 56,250 Income tax expense 22,660 Net income $ 33,590 $ Assets Cash Short-term investments Accounts receivable, net Merchandise inventory CABOT CORPORATION Balance Sheet December 31 Liabilities and Equity $ 14,000 Accounts payable 8,400 Accrued wages payable 30, 600 Income taxes payable 34,150 Long-term note payable, secured by mortgage on plant assets 2,800 Common stock 150,300 Retained earnings $ 240,250 Total liabilities and equity 17,500 3,800 3,200 67,400 Prepaid expenses Plant assets, net Total assets 83,000 65.350 $ 240, 250 Required: Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory, (6) debt-to-equity ratio, (7) times interest earned, (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stockholders' equity. (Do not round intermediate calculations.) Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Req 4 Req 5 Req 6 Req 7 Req 8 Req 9 Req 10 Req 11 Compute the current ratio and acid-test ratio. (1) Choose Numerator: Current assets Current Ratio 1 Choose Denominator: 1 Current liabilities 1 $ = = = Current Ratio Current ratio 3.7 to 1 89,950 24,500 (2) Choose Numerator: Acid-Test Ratio I Choose Denominator: 1 Current liabilities = = Acid-Test Ratio Acid-Test Ratio 0 to 1 Req 1 and 2 Req3 > Check my work Problem 17-4A Calculating financial statement ratios LO P3 points Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $51,900; total assets, $249,400; common stock, $83,000; and retained earnings, $31,760.) eBook Print References CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 456,600 Cost of goods sold 297,650 Gross profit 158,950 Operating expenses 98,800 Interest expense 3,900 Income before taxes 56,250 Income tax expense 22,660 Net income $ 33,590 $ Assets Cash Short-term investments Accounts receivable, net Merchandise inventory CABOT CORPORATION Balance Sheet December 31 Liabilities and Equity $ 14,000 Accounts payable 8,400 Accrued wages payable 30, 600 Income taxes payable 34,150 Long-term note payable, secured by mortgage on plant assets 2,800 Common stock 150,300 Retained earnings $ 240,250 Total liabilities and equity 17,500 3,800 3,200 67,400 Prepaid expenses Plant assets, net Total assets 83,000 65.350 $ 240, 250 Required: Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days' sales in inventory, (6) debt-to-equity ratio, (7) times interest earned, (8) profit margin ratio, (9) total asset turnover, (10) return on total assets, and (11) return on common stockholders' equity. (Do not round intermediate calculations.) Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Req 4 Req 5 Req 6 Req 7 Req 8 Req 9 Req 10 Req 11 Compute the current ratio and acid-test ratio. (1) Choose Numerator: Current assets Current Ratio 1 Choose Denominator: 1 Current liabilities 1 $ = = = Current Ratio Current ratio 3.7 to 1 89,950 24,500 (2) Choose Numerator: Acid-Test Ratio I Choose Denominator: 1 Current liabilities = = Acid-Test Ratio Acid-Test Ratio 0 to 1 Req 1 and 2 Req3 >