The Financial Statements of Hainz Company Appear Below Additional Information:
A

question 48

Essay

The financial statements of Hainz Company appear below: $\begin{array}{lcc} \text { Liabilities and stockholders' equity}\\ \text { Accounts payable } & \$ 20,000&\$30,000 \\ \text { Short-term notes payable} & 40,000 &90,000\\ \text { Bonds payable } & 80,000 &160,000\\\text { Common stock } & 150,000&150,000 \\\text { Retained earnings} & 110,000&70,000 \\\text { Total liabilities and stockholders' equity }&\$400,000&\$500,000\end{array}$ $\begin{array}{llr} \text { Net sales } &&\$400,000\\ \text {Cost of goods sold } &&250,000\\ \text { Gross profit} &&150,000\\ \text { Expenses} &\\ \text { Operating expenses } &\$42,000\\ \text { Interest expense } &18,000\\ \text { Total expenses } &&60,000\\ \text {Income before income taxes } &&90,000\\ \text { Income tax expense} &&27,000\\ \text { Net income.} &&\$63,000\\\end{array}$

Additional information:
a. Cash dividends of $\$ 23,000$ were declared and paid in 2017 .
b. Weighted-average number of shares of common stock outstanding during 2017 was 30,000 shares.
c. Market value of common stock on December 31, 2017, was $\$ 21$ per share. Instructions
Using the financial statements and additional information compute the following ratios for Hainz Company for 2017. Show all computations.
Computations
1. Current ratio _________.
2. Return on common stockholders' equity _________.
3. Price-earnings ratio _________.
4. Acid-test ratio _________.
5. Accounts receivable turnover _________.
6. Times interest earned _________.
7. Profit margin _________.
8. Days in inventory _________.
9. Payout ratio _________.
10. Return on assets _________.

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Definitions:

Wish

A desire or hope for something to happen or be the case, often without an expectation of actual realization.

Rapid Eye Movements

Quick movements of the eyes that occur during certain stages of sleep, particularly REM sleep, which is associated with dreaming.

Contradictory Information

refers to data or statements that are in direct opposition to each other, making it impossible for both to be true at the same time.

Hypnosis

A state resembling trance where focus and suggestibility are increased, commonly utilized for healing purposes.