PLEASE HELP WITH 5 THRU 8 Income Statement For Year Ended December 31, 2013 Sale

Question

PLEASE HELP WITH 5 THRU 8

Income Statement For Year Ended December 31, 2013 Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income taxes Net income $ 448,600 297.250 151,350 98,600 4,100 48,650 19,598 $ 29,052 CABOT CORPORATION Balance Sheet December 31, 2013 Assets Cash Short-term investments Accounts receivable, net Notes receivable (trade) Merchandise inventory Prepaid expenses Plant assets, net Total assets $ 10,000 8,400 29,200 4,500 32,150 2,650 153,300 $ 240,200 Liabilities and Equity Accounts payable Accrued wages payable Income taxes payable Long-term note payable, secured $ 17,500 3,200 3,300 by mortgage on plant assets Common stock Retained earnings Total liabilities and equity 63,400 90,000 62,800 $ 240,200 Balances on December 31, 2012 Inventory Total assets Common stock Retained earnings $48,900 $ 189,400 $ 90,000 $ 22,748 Check figures Acid-test ratio Inventory turnover 2.2 7.3

Explanation / Answer

5) Days' sales in inventory = Average inventory*365/cost of goods sold

= 40525*365/297250

Days's sales in inventory = 49.76 days or 49.8 days

6) Debt to equity ratio = Total debt/total equity

= 87400/152800

Debt to equity ratio = 0.57 to 1

7) Times interest earned = EBIT/Interest exp

= 52750/4100

Times interest earned = 12.87 times

8) PRofit margin ratio = 29052*100/448600 = 6.48%

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.