Use the Balance Sheets of Sando Shown Below to Calculate

question 150

Essay

Use the balance sheets of Sando shown below to calculate the following ratios for 2013 (round to the hundredths):
(a)Current ratio
(b)Acid-test ratio
(c)Debt ratio
(d)Equity ratio
$\begin{array}{c} \text { SANDO COMPANY}\\ \text { Balance Sheets }\\ \text { December 31,2013}\\ \begin{array}{|l|r|}\hline \text { Assets: } & \\\hline \text { Cash } & \$ 43,000 \\\hline \text { Accounts receivable } & 38,000 \\\hline \text { Merchandise inventory } & 61,000 \\\hline \text { Prepaid insurance } & 6,000 \\\hline \text { Long-term investments } & 49,000 \\\hline \text { Plant assets (net) } & 218,000 \\\hline \text { Total assets } & \$ 415,000\\\hline\\\hline \text { Liabilities and Equity: } & \\\hline \text { Current liabilities } & \$ 62,000 \\\hline \text { Long-term liabilities } & 45,000 \\\hline \text { Common stock } & 150,000 \\\hline \text { Retained earnings } & 158,000 \\\hline \text { Total liabilities and equity } & \$ 415,000\\\hline \end{array}\end{array}$

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Definitions:

Fire Extinguisher

A device that discharges a substance to put out a fire, often by cooling the fire, cutting off its oxygen supply, or both.

Substage

A division or smaller part that forms a component of a larger stage or phase.

Direct Contact

Physical interaction between an infected person or contaminant and a susceptible host, leading to the potential transfer of disease.

Condenser

Part of a microscope substage that regulates the amount of light directed on a specimen.