The interest expense on the income statement relates to the

Assignment Help Accounting Basics

Reference no: EM13576904

The following information is available about the company:

a.	Selected financial ratios computed from the statements above are given below:


Current ratio		2.60
Acid-test ratio		1.19
Accounts receivable turnover		16.0
Inventory turnover		6.0
Debt-to-equity ratio		0.900
Times interest earned		8.0
Earnings per share	$	4.83
Return on total assets		12	%

b.	All sales during the year were on account.
c.	The interest expense on the income statement relates to the bonds payable; the amount of bonds outstanding did not change throughout the year.
d.	There were no changes in the number of shares of common stock outstanding during the year.

e.	Selected balances at the beginning of the current year (January 1) were as follows:


Accounts receivable	$	160,000
Inventory	$	280,000
Total assets	$	2,160,000

Required:

Compute the missing amounts on the company's financial statements. (Input all amounts as positive values. Round your final answers to the nearest whole dollar amount. Omit the "$" sign in your response.)

Tanner Company Income Statement For the Year Ended December 31
Sales	$3,100,000
Cost of goods sold

Gross margin
Selling and administrative expenses

Net operating income
Interest expense	46,000

Net income before taxes
Income taxes (40%)

Net income	$

Tanner Company Balance Sheet December 31
Current assets:
Cash	$
Accounts receivable, net
Inventory

Total current assets
Plant and equipment, net

Total assets	$


Current liabilities	$260,000
Bonds payable, 10%

Total liabilities

Stockholders' equity:
Common stock, $2.60 par value
Retained earnings

Total stockholders' equity

Total liabilities and stockholders' equity	$

Reference no: EM13576904

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