Using the appropriate data below, calculate:

Current assets $=$ $$32,500$

Current liabilities $=$ $$21,550$

Debt payments $=$ $$25,300$

Depreciation expense $=$ $$20,000$

Gross revenues $=$ $$146,000$

Income tax expense $=$ $$4,000$

Interest $=$ $$12,300$

Net farm income from operations $=$ $$8,700$

Owner withdrawals $=$ $$500$

Total assets: end of the year $=$ $$100,000$; beginning of the year $=$ $$80,000$

Total equity: end of the year $=$ $$35,000$; beginning of the year $=$ $$35,000$

Total liabilities: end of the year $=$ $$65,000$; beginning of the year $=$ $$45,000$

a$.$ The current ratio and the working capital.

b$.$ The debt to assets ratio $($D$/$A$),$ equity to assets ratio $($E$/$A$),$ and debt to equity ratio $($D$/$E$,$ also known as leverage$)$ using beginning of the year

c$.$ The rate of return on farm assets $($ROFA$),$ the rate of return on farm equity $($ROFE$),$ and the cost of farm debt $($COFD$)$ using annual averages.

Answer rating: 100% (QA)

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