Given the financial statements for Jones Corporation and Smith Corporation:

JONES CORPORATION

Current Assets Liabilities

Cash $ $29,400$ Accounts payable $ $103,000$

Accounts receivable $88,300$ Bonds payable $($long term$)80,100$

Inventory $54,500$ 

Long$-$Term Assets Stockholders' Equity

Gross fixed assets $ $508,000$  Common stock $ $150,000$

Less: Accumulated depreciation $156,800$  Paid$-$in capital $70,000$

Net fixed assets$*$Note asterisk $351,200$ Retained earnings $120,300$

Total assets $ $523,400$ Total liabilities and equity $ $523,400$

Sales $($on credit$)$ $ $1,845,000$

Cost of goods sold $757,000$

Gross profit $ $1,088,000$

Selling and administrative expense$†$Note dagger $325,000$

Depreciation expense $59,400$

Operating profit $ $703,600$

Interest expense $16,300$

Earnings before taxes $ $687,300$

Tax expense $95,600$

Net income $ $591,700$

$*$Net fixed assets Note asteriskUse net fixed assets in computing fixed asset turnover.

$†$Selling and administrative expense Note daggerIncludes $$15,500$ in lease payments.

SMITH CORPORATION

Current Assets Liabilities

Cash $ $40,700$ Accounts payable $ $84,400$

Marketable securities $15,800$ Bonds payable $($long term$)283,000$

Accounts receivable $75,900$ 

Inventory $75,400$ 

Long$-$Term Assets Stockholders' Equity

Gross fixed assets $ $592,000$  Common stock $ $75,000$

Less: Accumulated depreciation $251,100$  Paid$-$in capital $30,000$

Net fixed assets$*$Note asterisk $340,900$ Retained earnings $76,300$

Total assets $ $548,700$ Total liabilities and equity $ $548,700$

$*$Net fixed assets Note asteriskUse net fixed assets in computing fixed asset turnover.

SMITH CORPORATION

Sales $($on credit$)$ $ $1,150,000$

Cost of goods sold $659,000$

Gross profit $ $491,000$

Selling and administrative expense$†$Note dagger $285,000$

Depreciation expense $57,300$

Operating profit $ $148,700$

Interest expense $23,800$

Earnings before taxes $ $124,900$

Tax expense $53,600$

Net income $ $71,300$

$†$Selling and administrative expense Note daggerIncludes $$15,500$ in lease payments.

Compute the following ratios. Profit margin Return on assets Return on equity Receivable turnover Average collection period Inventory turnover Fixed asset turnover Total asset turnover Current ratio

 

Answer rating: 100% (QA)

To compute the ratios for Jones Corporation and Smith Corporation well use the provided financial in... View the full answer