xercise 13-13

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The condensed financial statements of Ness Company for the years 2018 and 2019 are presented below.

NESS COMPANY Balance Sheets December 31 (in thousands)
		2019		2018
Current assets
Cash and cash equivalents		$330		$360
Accounts receivable (net)		470		400
Inventory		460		390
Prepaid expenses		130		160
Total current assets		1,390		1,310
Property, plant, and equipment (net)		410		380
Investments		10		10
Intangibles and other assets		530		510
Total assets		$2,340		$2,210
Current liabilities		$820		$790
Long-term liabilities		480		380
Stockholders equitycommon		1,040		1,040
Total liabilities and stockholders equity		$2,340		$2,210

NESS COMPANY Income Statements For the Year Ended December 31 (in thousands)
		2019		2018
Sales revenue		$3,800		$3,460
Costs and expenses
Cost of goods sold		970		890
Selling & administrative expenses		2,400		2,330
Interest expense		10		20
Total costs and expenses		3,380		3,240
Income before income taxes		420		220
Income tax expense		168		88
Net income		$ 252		$ 132

Compute the following ratios for 2019 and 2018. (Round current ratio and inventory turnover to 2 decimal places, e.g 1.83 and all other answers to 1 decimal place, e.g. 1.8 or 12.6%.)

(a)		Current ratio.
(b)		Inventory turnover. (Inventory on December 31, 2015, was $340.)
(c)		Profit margin.
(d)		Return on assets. (Assets on December 31, 2015, were $1,900.)
(e)		Return on common stockholders equity. (Equity on December 31, 2015, was $900.)
(f)		Debt to assets ratio.
(g)		Times interest earned.

		2019			2018
(a) Current ratio.			:1			:1
(b) Inventory turnover.
(c) Profit margin.			%			%
(d) Return on assets.			%			%
(e) Return on common stockholders equity.			%			%
(f) Debt to assets ratio.			%			%
(g) Times interest earned.			times			times

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