Problem: The following data are taken from the financial statements of Prone, Inc. as of the end of the year 2007. The data are in alphabetical order.
Accounts payable
$ 28,000
Net income
$ 48,000
Accounts receivable
66,000
Other current liabilities
17,000
Cash
54,000
Total assets
250,000
Gross profit
160,000
Total liabilities
200,000
Income before income taxes
54,000
Wages payable
5,000
Additional information: The number of average common shares outstanding during the year was 40,000.
Instructions: Compute the following:
(a) Current ratio.
(b) Working capital.
(c) Earnings per share.
(d) Debts to total assets ratio.
Show your computations and explain your findings