Question Details

The comparative balance sheet for Johnson Stoll Company 



Ex. 1
Selected information from the comparative financial statements of Fryman Company for the year
ended December 31, appears below:
2002 2001
Accounts receivable (net) $ 180,000 $200,000
Inventory 140,000 160,000
Total assets 1,200,000 800,000
Current liabilities 140,000 110,000
Long-term debt 400,000 300,000
Net credit sales 1,330,000 700,000
Cost of goods sold 900,000 530,000
Interest expense 50,000 25,000
Income tax expense 60,000 29,000
Net income 150,000 85,000
Net cash provided by operating activities 220,000 135,000
Instructions
Answer the following questions relating to the year ended December 31, 2002. Show computations.
1. The inventory turnover ratio for 2002 is __________.
2. The times interest earned ratio in 2002 is __________.
3. The debt to total assets ratio for 2002 is __________.
4. The receivables turnover ratio for 2002 is __________.
5. The return on assets ratio for 2002 is __________.
6. The cash return on sales ratio for 2002 is __________.
7. The current cash debt coverage ratio for 2002 is __________.
Ex. 2
The comparative balance sheet for Johnson Stoll Company is given below:
JOHNSON STOLL COMPANY
Comparative Balance Sheet
December 31,
———————————————————————————————————————————
Assets 2003 2002
Cash ............................................................................................... $ 30,000 $ 45,000
Accounts receivable (net) ............................................................... 97,500 90,000
Inventory ........................................................................................ 90,000 75,000
Plant assets (net) ........................................................................... 300,000 270,000
Total assets .............................................................................. $517,500 $480,000
Liabilities and Stockholders' Equity
Accounts payable ........................................................................... $ 75,000 $ 90,000
Mortgage payable (8%) .................................................................. 150,000 150,000
Common stock, $10 par ................................................................. 210,000 180,000
Retained earnings .......................................................................... 82,500 60,000
Total liabilities and stockholders' equity..................................... $517,500 $480,000
Additional information for 2003:
1. Income before interest expense and income taxes was $168,000.
2. Sales on account were $990,000. Sales returns and allowances amounted to $5,625.
3. Cost of goods sold was $676,500.
4. Net cash provided by operating activities was $185,625.
5. Interest expense totaled $12,000.
Instructions
Compute the following ratios at December 31, 2003:
a. Current ratio
b. Acid-test ratio
c. Current cash debt coverage ratio
d. Receivables turnover ratio
e. Average collection period
f. Inventory turnover
g. Average days in inventory
h. Debt to total assets ratio
i. Times interest earned
j. Cash debt coverage ratio




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