| Question 5   The comparative statements of Osborne Company are presented here.
| OSBORNE COMPANY
Income Statements
For the Years Ended December 31 | | | | 2014 | | 2013 | | Net sales | | $1,899,547 | | $1,759,507 | | Cost of goods sold | | 1,067,547 | | 1,015,007 | | Gross profit | | 832,000 | | 744,500 | | Selling and administrative expenses | | 509,007 | | 488,007 | | Income from operations | | 322,993 | | 256,493 | | Other expenses and losses | | | | | | Interest expense | | 23,656 | | 21,656 | | Income before income taxes | | 299,337 | | 234,837 | | Income tax expense | | 93,656 | | 74,656 | | Net income | | $ 205,681 | | $ 160,181 |
| OSBORNE COMPANY
Balance Sheets
December 31 | | Assets | | 2014 | | 2013 | | Current assets | | | | | | Cash | | $ 60,100 | | $ 64,200 | | Debt investments (short-term) | | 74,000 | | 50,000 | | Accounts receivable | | 126,807 | | 111,807 | | Inventory | | 127,656 | | 117,156 | | Total current assets | | 388,563 | | 343,163 | | Plant assets (net) | | 663,327 | | 534,627 | | Total assets | | $1,051,890 | | $877,790 | | Liabilities and Stockholders’ Equity | | | | | | Current liabilities | | | | | | Accounts payable | | $ 169,007 | | $154,407 | | Income taxes payable | | 45,156 | | 43,656 | | Total current liabilities | | 214,163 | | 198,063 | | Bonds payable | | 234,327 | | 214,327 | | Total liabilities | | 448,490 | | 412,390 | | Stockholders’ equity | | | | | | Common stock ($5 par) | | 290,000 | | 300,000 | | Retained earnings | | 313,400 | | 165,400 | | Total stockholders’ equity | | 603,400 | | 465,400 | | Total liabilities and stockholders’ equity | | $1,051,890 | | $877,790 |
All sales were on account. Net cash provided by operating activities for 2014 was $240,730. Capital expenditures were $136,020, and cash dividends were $57,681.
Compute the following ratios for 2014. (Round all answers to 2 decimal places, e.g. 1.83 or 12.61%.) | (a) | | Earnings per share | | $   | | | (b) | | Return on common stockholders’ equity | |  | % | | (c) | | Return on assets | |  | % | | (d) | | Current ratio | |  | :1 | | (e) | | Accounts receivable turnover | |  | times | | (f) | | Average collection period | |  | days | | (g) | | Inventory turnover | |  | times | | (h) | | Days in inventory | |  | days | | (i) | | Times interest earned | |  | times | | (j) | | Asset turnover | |  | times | | (k) | | Debt to assets | |  | % | | (l) | | Current cash debt coverage | |  | times | | (m) | | Cash debt coverage | |  | times | | (n) | | Free cash flow | | $  | |
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