Sharp Uniforms designs, manufactures, and implements corporate identity uniform

Question

Sharp Uniforms designs, manufactures, and implements corporate identity uniform programs that it rents or sells to customers throughout the United States and Canada. Selected information from the company’s balance sheet follows.

1,325

Receivable Turnover Ratio =?

Inventory Turnover Ratio = ?

Current Ratio =?

Cash Ratio = ?

Times Interest Earned Ratio -?

Cash Coverage = ?

SHARP
(in millions) Current Year Last Year Select Income Statement Information Net revenue $ 4,576 $ 4,340 Cost of goods sold 2,673 2,553 Selling, general, and administrative expenses 1,315 1,246 Interest expense 96 94 Income tax expense 245 220 Net income 398 351 Select Statement of Cash Flows Information Cash paid for interest 77 81 Cash flows from operating activities 668 589 Select Balance Sheet Information Cash and equivalents 537 400 Marketable securities — 18 Accounts receivable 532 541 Inventories 275 276 Prepaid expense and other current assets 50 37 Accounts payable 210 133 Current accrued expenses 437 390 Current portion of long-term debt 13 32 Other current liabilities 126 97 Long-term debt 1,360

1,325

Explanation / Answer

Cash ratio and Cash coverage ratio are same

Accounts receivable turnover ratio = Net credit sales / Average accounts recievable Accounts receivable turnover ratio = $4,576 / (($532 + $541)/2) Accounts receivable turnover ratio = 8.53 Times

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