Calculate the current ratio

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Reference no: EM131135383

Use the following information to answer items 1-3: SHOW YOUR WORK

At December 31 a company's records show the following information:

  • Cash $10,000
  • Accounts Receivable 30,000
  • Inventory 80,000
  • Prepaid Insurance 6, 000
  • Long-term Assets 200,000
  • Accounts Payable 30,000
  • Notes Payable due in 10months 25,000
  • Wages Payable 5,000
  • Long-term Liabilities 70,000
  • Stockholders' (Owner's) Equity 196,000

1. Calculate the current ratio

2. Calculate the Debt to Equity ratio

3. Calculate the Return on Assets

Use the following information to answer items 4-5: SHOW YOUR WORK

For its most recent year a company had Sales (all on credit) of $830, 000 and Cost of Goods Sold of $525, 000. At the end of the year its Accounts Receivable were $86,000 and its Inventory was $110,000. Accounts Payable was $5,000 and Net Income was $42,000.

4. Calculate the Accounts Receivable Turn Days

5. Calculate the Inventory Turn days

Reference no: EM131135383

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