Use the Financial Data Shown Below to Calculate the Following $\text { Income statement data }$

question 164

Essay

Use the financial data shown below to calculate the following ratios for the current year:
(a)Current ratio.
(b)Acid-test ratio.
(c)Accounts receivable turnover.
(d)Days' sales uncollected.
(e)Inventory turnover.
(f)Days' sales in inventory.
$\text { Income statement data }$
Sales (all on credit)……………………………… $650,000
Cost of goods sold………………………………….425,000
Income before taxes………………………………..78,000
Net income………………………………………… 54,600
$\begin{array}{|l|c|c|}\hline&\text { Ending } & \text { Beginning } \\&\text { Balances } & \text { Balances }\\\hline \text { Cash } & 19,500 & 15,000 \\\hline \text { Accounts receivable (net) } & 65,000 & 60,000 \\\hline \text { Inventory } & 71,50 \mathrm{~d} & 64,500 \\\hline \text { Plant and equipment (net) } & 195,000 & 183,900 \\\hline \text { Total assets } & \$ 351.00 \mathrm{~d} & \$ 323,400 \\\hline \text { Current liabilities } & \$ 62,400 & \$ \quad 52,700 \\\hline\text { Long-term notes payable } & 97,500 & 100,000\\\hline\end{array}$

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Definitions:

Catalysts

Substances that increase the rate of chemical reactions without being consumed in the process.

Enzymes

Biomolecules that substantially increase the pace of nearly all chemical processes happening within cellular structures.

Concentration

is the measure of the amount of a subcomponent (especially solute) in a solution.

Cyanide Compounds

Toxic chemicals that can inhibit cellular respiration by preventing cells from using oxygen, potentially leading to death.