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Use the Following Selected Financial Information for Wilcox Corporation to Answer

question 5

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Use the following selected financial information for Wilcox Corporation to answer questions . Wilcox Corporation
Income Statement
For the Year Ended December 31,2015
 Net sales $2,870 Cost of goods sold 1,985 Gross profit $885 Operating expenses 620 Operating profit $265 Interest expense 40 Earnings before taxes $225 Income tax expense 80 Net profit $145\begin{array}{lr}\text { Net sales } & \$ 2,870 \\\text { Cost of goods sold } & 1,985\\\text { Gross profit } & \$ \overline{885} \\\text { Operating expenses } & 620\\\text { Operating profit } & \$ 265 \\\text { Interest expense } & 40\\\text { Earnings before taxes }&\$225\\\text { Income tax expense }&80\\\text { Net profit }&\$145\end{array} Wilcox Corporation
Balance Sheet
December 31, 2015
 Assets  Liabilities and stockholders’ equity  Current assets  Current liabilities  Cash $25 Accounts payable $85 Short-term investments 15 Accrued liabilities 45 Accounts receivable 70 Total current liabilities 130 Inventory 150 Long-term debt 240 Total current assets 260 Total liabilities 370 Long-term assets  Stockholders’ equity  Net PPE 390 Common stock and PIC 80 Goodwill 210 Retained earnings 410 Total stockholders’ equity 490 Total assets $860 Total liabilities and equity $860\begin{array}{lclr}\text { Assets }&&\text { Liabilities and stockholders' equity }\\\hline\text { Current assets }&&\text { Current liabilities }\\\text { Cash } & \$ 25 & \text { Accounts payable } & \$ 85 \\\text { Short-term investments } & 15 & \text { Accrued liabilities } & 45 \\\text { Accounts receivable } & 70 & \text { Total current liabilities } & 130 \\\text { Inventory } & 150 & \text { Long-term debt } & 240\\\text { Total current assets }&260&\text { Total liabilities }&370\\\\\text { Long-term assets }&&\text { Stockholders' equity }\\\text { Net PPE } & 390 & \text { Common stock and PIC } & 80 \\\text { Goodwill } & 210 & \text { Retained earnings } & 410\\&&\text { Total stockholders' equity }&490\\\text { Total assets }&\$860&\text { Total liabilities and equity }&\$860\end{array} WilcoxCorporation
Statement of Cash Flow Information
For the Year Ended December 31, 2015

 Cash from operating activities $150 Investing activities:  Capital expenditures $60 Acquisitions $10 Financing activities:  Proceeds from long-term borrowing $50 Payments on long-term borrowing $25 Payments of cash dividends $20 Cash paid for interest $10 Cash paid for income taxes $75\begin{array}{ll}\text { Cash from operating activities }&\$150\\\text { Investing activities: }\\\text { Capital expenditures } & \$ 60 \\\text { Acquisitions } & \$ 10\\\text { Financing activities: }\\\text { Proceeds from long-term borrowing } & \$ 50 \\\text { Payments on long-term borrowing } & \$ 25 \\\text { Payments of cash dividends } & \$ 20\\\text { Cash paid for interest } & \$ 10 \\\text { Cash paid for income taxes } & \$ 75\end{array}
-Wilcox's total asset turnover ratio is:


Definitions:

DR (Debit)

DR, or Debit, represents the left side of a general ledger account and is used to record increases in assets or expenses and decreases in liabilities, equity, and income.

CR (Credit)

An accounting entry that decreases assets or increases liabilities and equity on a company's balance sheet, reflective of the double-entry bookkeeping system.

Tax Expense

The total amount of taxes a company incurs, reflecting both current taxes due and future tax liabilities.

Pre-Tax Book Income

The income of a business before taxes have been deducted, as reported in its financial statements.

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