Solved

The Balance Sheet at December 31,2015 for Zumba Company Follows

Question 117

Essay

The balance sheet at December 31,2015 for Zumba Company follows:
The balance sheet at December 31,2015 for Zumba Company follows:    Additional information follows: 1.Net income for the year ended December 31,2015 is $2,020. 2.Cost of goods sold for the year ended December 31,2015 is $4,400. 3.Inventory on January 1,2015 is $1,800. 4.Accounts Receivable,net on January 1,2015 is $4,400. 5.Total assets on January 1,2015 is $20,000. 6.Net credit sales for the year ended December 31,2015 is $14,600. 7.Net income before interest and taxes for the year ended December 31,2015 is $4,800. 8.Interest expense for the year ended December 31,2015 is $550. 9.Total stockholders' equity on January 1,2015 is $3,500. Compute the following ratios: 1.Current ratio 2.Quick ratio 3.Accounts receivable turnover 4.Days' inventory outstanding 5.Times interest earned 6.Return on assets 7.Return on equity Additional information follows:
1.Net income for the year ended December 31,2015 is $2,020.
2.Cost of goods sold for the year ended December 31,2015 is $4,400.
3.Inventory on January 1,2015 is $1,800.
4.Accounts Receivable,net on January 1,2015 is $4,400.
5.Total assets on January 1,2015 is $20,000.
6.Net credit sales for the year ended December 31,2015 is $14,600.
7.Net income before interest and taxes for the year ended December 31,2015 is $4,800.
8.Interest expense for the year ended December 31,2015 is $550.
9.Total stockholders' equity on January 1,2015 is $3,500.
Compute the following ratios:
1.Current ratio
2.Quick ratio
3.Accounts receivable turnover
4.Days' inventory outstanding
5.Times interest earned
6.Return on assets
7.Return on equity

Correct Answer:

verifed

Verified

1.Current ratio = $7,900 ÷ $4,000 = 1.98...

View Answer

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents