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The financial statements for Castile Products, Inc. are given below:
Balance Sheet
Assets
Current Assets:-
Cash
$6,500
Accounts receivable, net
$35,000
Merchandise Inventory
$70,000
Prepaid expenses
$3,500
Total Current Assets
$115,000
Property and equipment, net
$185,000
Total assets
$300,000
Liabilities and Stockholder's Equity:-
Liabilities:
Current liabilities
$50,000
Bond payable, 10%
$80,000
Total Liabilities
$130,000
Stockholders' equity:
Common stock $5 par value
$30,000
Retained Earnings
$140,000
Total stockholders' equity
$170,000
Total liabilities and equity
Castile Products
Income Statement
Sales
$420,000
Cost of goods sold
$292,500
Selling and administrative expenses
$89,500
Net Operating Income
$38,000
Interest expense
$8,000
Income taxes (30%)
$9,000
Net Income
$21,000
Account balances at the beginning of the year were: accounts receivable $25,000, inventory $60,000. all sales were on account.
Required:
Compute financial ratios as follows:
1. Gross margin percentage
2. Current ratio
3. Acid-test ratio
4. Debt-to-equity ratio
5. Average collection period
6. Average sale period
7. Times interest earned ratio
8. Book value per share
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