question 16
Multiple Choice
Comparative financial statements for Bent Stew Enterprises are shown below: Assets Current assets: Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment, net Intangible assets, net Total assets Liabilities and Stockholders’ Equity Current liabilities: Accounts payable Other current liabilities Total current liabilities Long-term debt Total liabilities Stockholders’ equity: Common stock Additional paid-in capital Retained earnings Total stockholders’ equity Total liabilities and stockholders’ equity Sales Cost of goods sold Gross margin Operating expenses Operating income Interest expense Earnings before income taxes Income taxes Net earnings December 312018$3,0008,50012,0001,40024,900103,60064,000$192,500$11,00011,80022,800120,000142,80015,00020,00014,70049,700$192,500 Year Ended December 312018$250,000164,00086,00064,00022,0007,50014,5007,800$6,7002017$8006,0008,20090015,900123,30047,000$186,200$12,0003,20015,200128,000143,20015,00020,0008,00043,000$186,2002017$230,000142,30087,70054,00033,7005,90027,8007,140$20,680 How much is Bent Stew's times interest earned for 2018?
Definitions:
Purchases
The total cost of goods acquired by a company for resale or use in production during an accounting period.
Freight-In Account
An accounting term for the cost of transporting goods into a business, which is part of the cost of goods sold.
Income Summary
An account in the ledger that is used during the closing process to collect all the temporary account balances before transferring the net result to the capital account.
Purchases
The acquisition of goods or services by a company for use in its operations or for resale.