Question: Smith Company Balance Sheet and Selected Income Statement Data Assets: Cash and marketable securities $300,000 Accounts receivable 2,215,000 Inventories 1,837,500 Expenses paid in advance 24,000
Smith Company Balance Sheet and Selected Income Statement Data
Assets:
Cash and marketable securities $300,000
Accounts receivable 2,215,000
Inventories 1,837,500
Expenses paid in advance 24,000
Total current assets $3,286,500
Fixed assets 2,700,000
Less: accumulated depreciation 1,087,500
Net fixed assets $1,612,500
Total assets $4,899,000
Passives:
Accounts Payable $240,000
Unpaid documents 825,000
Accrued taxes 42,500
Total current liabilities $1,107,000
long-less-term
debt 975,000
Owner's equity 2,817,000
Total Liabilities and Owner's Equity $4,899,000
Net sales (all credit) $6,375,000
Less: Cost of goods sold 4,312,500
Selling and administrative expenses 1,387,500
Depreciation expense 135,000
Interest expense 127,000
Profit before taxes $412,500
Income taxes 225,000
Net income $187,500
Common stock dividends $97,500
Change in retained earnings $90,000
Based on the information, calculate the net profit margin.
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