[The following information applies to the questions displayed below.] Income sta

Question

[The following information applies to the questions displayed below.] Income statement and balance sheet data for The Athletic Attic are provided below THE ATHLETIC ATTIC Income Statements For the years ended December 31 2019 2018 Net sales Cost of goods sold $13.200,000 $11800,000 8.600,000 7400,000 Gross profit 4.600,000 4400.000 Expenses Operating expenses Depreciation expense Interest expense Income tax expense 1800.000 1750,000 200.000 200.00o 60.000 550.000 60,000 640.000 Total expenses 2700.000 2.560.000 Net income $1.900.000 $1840.000 THE ATHLETIC ATTIC Balance Sheets December 31 Assets et assets

Explanation / Answer

Receivable turnover ratio = Net sales/Average accounts receivables

2018 = 11,800,000/ ((760,000+780,000)/2)= 15.32

2019 = 13,200,000/((1,010,000+760,000)/2)= 14.92

Inventory turnover ratio = Sales/ Average inventory

2018 = 11,800,000/ ((1,375,000+1,045,000)/2)= 9.75

2019 = 13,200,000/((1,745,000+1,375,000)/2)= 8.46

Current ratio = current assets/current liabilities

2018= (175,000+760,000+1,375,000+120,000)/(166,000+55,000) = 11

2019 = (245,000+1,010,000+1,745,000+150,000)/(233,000+6,000+60,000)= 10.54

Debt to equity ratio = debt/equity

2018= 700,000/(800,000+2,009,000) = 0.25

2019 = 700,000/(800,000+2,451,000) = 0.21

Gross profit ratio = gross profit/sales

Return on assets = Net income+interest/average total assets

Profit margin = netincome/sales

Asset turnover = Sales / average total assets

Particulars 2019 2018 Gross profit      4,600,000      4,400,000 Sales    13,200,000    11,800,000 GP ratio 34.85% 37.29%

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

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