Reference no: EM132289036

Question - Reynolds Corporation's comparative balance sheets are presented below.

Reynolds CORPORATION Balance Sheets December 31 2018 2017

Cash $10,000 $9,000

Accounts receivable 35,000 30,000

Inventory 25,500 20,000

Land 15,000 15,000

Building 90,000 90,000

Accumulated depreciation (27,000) (25,000)

Total $148,500 $139,000

Accounts payable $50,000 $45,000

Common stock 65,000 60,000

Retained earnings 33,500 34,000

Total $148,500 $139,000

Reynolds' 2018 income statement included net credit sales of $200,000, cost of goods sold of $120,000, and net income of $30,000.

Instructions: Compute the following ratios for 2018. (a) Current ratio. (b) Acid-test ratio. (c) Receivables turnover. (d) Profit margin. (e) Return on assets.