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Reynolds Corporation's comparative balance sheets are presented below.
Reynolds Corporation's comparative balance sheets are presented below.
Reynolds CORPORATION
Balance Sheets
December 31
2018
2017
Cash
$ 10,000
$ 9,000
Accounts receivable
35,000
30,000
Inventory
25,500
20,000
Land
15,000
15,000
Building
90,000
90,000
Accumulated depreciation
(27,000)
(25,000)
Total
$148,500
$139,000
Accounts payable
$ 50,000
$ 45,000
Common stock
65,000
60,000
Retained earnings
33,500
34,000
Total
$148,500
$139,000
Reynolds' 2018 income statement included net credit sales of $200,000, cost of goods sold of $120,000, and net income of $30,000.
Instructions:
Compute the following ratios for 2018. (a) Current ratio. (b) Acid-test ratio. (c) Receivables turnover. (d) Profit margin. (e)Return on assets. (Round ratios to 2 decimal places and percentages to 1 decimal place.)
