Required 1 Required 2 Calculate the following risk ratios for 2024: (Round your answers to 1 decimal place.) Risk Ratios a. Receivables turnover ratio b. Inventory turnover ratio c. Current ratio d. Acid-test ratio times times e. Debt to equity ratio %
Required 1 Required 2 Calculate the following risk ratios for 2024: (Round your answers to 1 decimal place.) Risk Ratios a. Receivables turnover ratio b. Inventory turnover ratio c. Current ratio d. Acid-test ratio times times e. Debt to equity ratio %
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter8: Current And Contingent Liabilities
Section: Chapter Questions
Problem 34CE
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Question
The balance sheets for Dual Monitors Corporation and additional information are provided below.
| DUAL MONITORS CORPORATION | ||
| Balance Sheets | ||
| December 31, 2024 and 2023 | ||
| 2024 | 2023 | |
|---|---|---|
| Assets | ||
| Current assets: | ||
| Cash | $158,800 | $123,000 |
| Accounts receivable | 84,000 | 95,000 |
| Inventory | 98,000 | 83,000 |
| Investments | 4,300 | 2,300 |
| Long-term assets: | ||
| Land | 510,000 | 510,000 |
| Equipment | 820,000 | 700,000 |
| Less: Accumulated depreciation | (458,000) | (298,000) |
| Total assets | $1,217,100 | $1,215,300 |
| Liabilities and |
||
| Current liabilities: | ||
| Accounts payable | $102,000 | $88,000 |
| Interest payable | 7,500 | 12,300 |
| Income tax payable | 9,500 | 5,300 |
| Long-term liabilities: | ||
| Notes payable | 100,000 | 200,000 |
| Stockholders' equity: | ||
| Common stock | 730,000 | 730,000 |
| 268,100 | 179,700 | |
| Total liabilities and stockholders' equity | $1,217,100 | $1,215,300 |
Additional information for 2024:
- Net income is $88,400.
- Sales on account are $1,628,900.
- Cost of goods sold is $1,230,800.
Required:
1. Calculate the following risk ratios for 2024:
2. When we compare two companies, can one have a higher
Transcribed Image Text:Required 1
Required 2
Calculate the following risk ratios for 2024: (Round your answers to 1 decimal place.)
Risk Ratios
a. Receivables turnover ratio
b. Inventory turnover ratio
c. Current ratio
d. Acid-test ratio
times
times
e. Debt to equity ratio
%
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