Question: 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,
Required:
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| 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.) |
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| (1) | Current Ratio |
| | Choose Numerator: | / | Choose Denominator: | = | Current Ratio |
| | | / | | = | Current ratio |
| 2015: | | / | | = | | to 1 |
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| | | (2) | Acid-Test Ratio | | | Choose Numerator: | / | Choose Denominator: | = | Acid-Test Ratio | | | | / | | = | Acid-test ratio | | 2015: | | / | | = | | to 1 | |
Days Sales Uncollected
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| 3 | Choose Numerator: | / | Choose Denominator: | x | Days | = | Days Sales Uncollected |
| | | / | | x | | = | Days sales uncollected |
| 2015: | | / | | x | | = | | days |
| (4) | Inventory Turnover |
| | Choose Numerator: | / | Choose Denominator: | = | Inventory Turnover |
| | | / | | = | Inventory turnover |
| 2015: | | / | | = | | times |
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| | | (5) | Days Sales in Inventory | | | Choose Numerator: | / | Choose Denominator: | x | Days | = | Days Sales in Inventory | | | | / | | x | | = | Days sales in inventory | | 2015: | | / | | x | | = | | days | |
| (6) | Debt-to-Equity Ratio |
| | Choose Numerator: | / | Choose Denominator: | = | Debt-to-Equity Ratio |
| | | / | | = | Debt-to-equity ratio |
| 2015: | | / | | = | | to 1 |
| (7) | Times Interest Earned |
| | Choose Numerator: | / | Choose Denominator: | = | Times Interest Earned | |
| | | + | | / | | = | Times interest earned | |
| 2015: | | + | | / | | = | | times |
| (8) | Profit Margin Ratio |
| | Choose Numerator: | / | Choose Denominator: | = | Profit margin ratio | |
| | | / | | = | Profit margin ratio | |
| 2015: | | / | | = | | % |
| (9) | Total Asset Turnover |
| | Choose Numerator: | / | Choose Denominator: | = | Total Asset Turnover |
| | | / | | = | Total asset turnover |
| 2015: | | / | | = | | times |
| (10) | Return on Total Assets |
| | Choose Numerator: | / | Choose Denominator: | = | Return on Total Assets | |
| | | / | | = | Return on total assets | |
| 2015: | | / | | = | | % |
| (11) | Return on Common Stockholders' Equity |
| | Choose Numerator: | / | Choose Denominator | = | Return On Common Stockholders' Equity | |
| | | - | | / | | = | Return on common stockholders' equity | |
| 2015: | | - | | / | | = | | % |
Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2014, were inventory, S55,900; total assets, 3189,400; common stock, $82,000; and retained earnings, S45,750.) CABOT CORPORATION Income Statement For Year Ended December 31, 2015 Sales Cost of goods sold S449,600 297,150 Gross profit Operating expenses Interest expense 152,450 99,400 3,900 Income before taxes Income taxes 49,150 19,800 Net income S 29,350 CABOT CORPORATION Balance Sheet December 31, 2015 Assets S 20,000 9,000 28,800 00 38,150 2,950 151,300 Liabilities and Equity Accounts payable Accrued Income taxes payable Long-term note payable, secured S 18,500 4,400 3,800 Cash wages payable Accounts receivable, net Notes receivable (trade) 3,0 Prepaid expenses Plant assets, net by mortgage on plant assets Common stock Retained earnings 89,400 82,000 75,100 Total assets S253,200 Total liabilities and equity S253,200 These are short-term notes receivable arising from customer (trade) sales
