Using the financial statements for the Niara Calendar Company, calculate the 13 basic ratios found in the chapter.
NIARA ENTERPRISES
BALANCE SHEET
DECEMBER 31, 2008
Current assets:
Cash ............... $25,000
Marketable securities ........ 45,000
Accounts receivable (net)....... 122,000
Inventory ............. 155,000
Total current assets........ $347,000
Investments.............. 20,000
Plant and equipment......... 475,000
Less: Accumulated depreciation..... (100,000)
Net plant and equipment...... 375,000
Total assets............ $742,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable.......... $65,000
Notes payable............. 20,000
Accrued taxes........... 12,000
Total current liabilities....... 97,000
Long-term liabilities:
Bonds payable........... 150,000
Total liabilities.......... 247,000
Stockholders' equity preferred
stock, $100 par value......... 75,000
Common stock, $1 par value...... 50,000
Capital paid in excess of par....... 250,000
Retained earnings........... 120,000
Total stockholders' equity.... 495,000
Total liabilities and stockholders' equity..$742,000
NIARA ENTERPRISES
INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2008
Sales (on credit) ........... $2,200,000
Less: Cost of goods sold........ 1,300,000
Gross profit............. 900,000
Less: Selling and administrative expenses. 400,000
Operating profit (EBIT)......... 500,000
Less: Interest expense......... 25,000
Earnings before taxes (EBT)....... 475,000
Less: Taxes.............. 190,000
Earnings after taxes (EAT)....... $285,000
*Includes $10,000 in lease payments.