Questions:
1. If a retail store has a current ratio of 2 1/2 to 1 and current assets of $150,000, the amount ofworking capital is:
A) $ 60,000.
B) $225,000.
C) $120,000.
D) $ 90,000.
Use the following to questions 6 - 10:
Given below are comparative balance sheets and an income statement for Pearl Corporation
2. Refer to the above data. Pearl Corporation's accounts receivable turnover for 2005 is:
A) 4.6 times.
B) 2.9 times.
C) 5.4 times.
D) 68 days.
3. Refer to the above data. Pearl Corporation's inventory turnover for 2005 is:
A) 6.6 times.
B) 3.9 times.
C) 4.1 times.
D) 94 days.
4. Refer to the above data. Pearl Corporation's gross profit rate for 2005 is:
A) 60.1%.
B) 39.9%.
C) 33%.
D) 68%.
5. Refer to the above data. Pearl Corporation's return on assets for 2005, rounded to the nearest tenth of a percent, is:
A) 9.9%.
B) 4.1%.
C) 5.9%.
D) 16.9%.
6. Refer to the above data. Pearl Corporation's return on common stockholders' equity for 2005, rounded to the nearest tenth of a percent, is:
A) 5.9.%.
B) 6.05%.
C) 14.4%.
D) 9.4%.