The Following Data Are Taken from the Financial Statements of Edington

question 87

Essay

The following data are taken from the financial statements of Edington Company. The data are in alphabetical order. $\begin{array}{lrlr}\text { Accounts payable } & \$ 28,000 & \text { Net sales } & 500,000 \\\text { Accounts receivable } & 65,000 & \text { Other current liabilities } & 20,000 \\\text { Average common shares out. } & 20,000 & \text { Salaries and wages payable } & 7,000 \\\text { Cash } & 56,000 & \text { Stockholders' equity } & 135,000 \\\text { Gross profit } & 190,000 & \text { Total assets } & 300,000\\\text { Net income } \quad 50,000\end{array}$ Instructions
Compute the following:
(a) Current ratio. (c) Earnings per share.
(b) Working capital. (d) Debt to assets ratio.

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Definitions:

Market Value

Market value is the current price at which an asset or service can be bought or sold.

Inventory Value

The total cost or market value of all the goods held by a company, intended for sale in the ordinary course of business.

Cost

The monetary value required to produce, acquire, or maintain a product or service.

Retail Values

The price at which goods and services are sold to consumers in a retail setting, often higher than wholesale prices.