Y-Mart Had Net Sales of $645,000

question 64

True/False

Y-Mart had net sales of $645,000. Its cost of goods was $445,000. Its gross margin was $200,000.

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Definitions:

Average Collection Period

calculates the average number of days it takes for a business to receive payments from its customers for invoices issued.

Times Interest Earned

A financial ratio that measures a company's ability to meet its debt obligations by comparing its income before interest and taxes to its interest expenses.

Debt-To-Equity Ratio

A measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity.

Equity Multiplier

A financial leverage ratio that shows the proportion of a company's assets that are financed by shareholder's equity.