Question: Selected year-end financial statements of Overton
Selected year-end financial statements of Overton Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2014, were inventory, $17,400; total assets, $94,900; common stock, $35,500; and retained earnings, $18,800.)
Required
Compute the following:
(1) current ratio,
(2) acid-test ratio,
(3) days’ sales uncollected,
(4) inventory turnover,
(5) days’ sales in inventory,
(6) debt-to-equity ratio,
(7) times interest earned,
(8) profit margin ratio,
(9) total asset turnover,
(10) return on total assets, and
(11) return on common stockholders’ equity.
Round to one decimal place; for part 6, round to two decimals.
Transcribed Image Text:
OVERTON CORPORATION Income Statement For Year Ended December 31, 2015 Sales .... $315,500 Cost of goods sold Gross profit ..... Operating expenses 236, 100 79,400 49,200 Interest expense 2,200 Income before taxes 28,000 Income taxes... 4,200 Net income $ 23,800 OVERTON CORPORATION Balance Sheet December 31, 2015 Liabilities and Equity $ 6,100 Accounts payable .... 6,900 Accrued wages payable 12,100 Income taxos payable 3,000 Long-term note payable, secured Assets $ 11,500 3,300 Cash Short-term investments Accounts receivable, net 2,600 Notes receivable (trade)* Merchandise inventory Prepaid expenses 13,500 by mortgage on plant assets 30,000 2,000 Common stock, $5 par value 73,900 Retained earnings $117,500 Total liabilities and equity 35,000 Plant assets, net 35, 100 Total assets $117,500 * These are short-term notes reccivable arising from customer (trade) sales.
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