1. Bethesda Mining Company reports the following balance sheet information for 2015 and 2016. BETHESDA MINING COMPANY Balance...

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Finance

1. Bethesda Mining Company reports the following balance sheetinformation for 2015 and 2016.
BETHESDA MINING COMPANY
Balance Sheets as of December 31, 2015 and 2016
2015 2016 2015 2016
Assets Liabilities and Owners’ Equity
Current assets Current liabilities
Cash $ 29,266 $ 38,098 Accounts payable $ 193,922 $ 201,611
Accounts receivable 58,281 78,639 Notes payable 89,020 140,588
Inventory 133,148 199,946 Total $ 282,942 $ 342,199
Total $ 220,695 $ 316,683 Long-term debt $ 245,000 $ 181,750
Owners’ equity
Common stock and paid-in surplus $ 210,000 $ 210,000
Fixed assets Accumulated retained earnings 140,100 172,012
Net plant and equipment $ 657,347 $ 589,278 Total $ 350,100 $ 382,012
Total assets $ 878,042 $ 905,961 Total liabilities and owners’ equity $ 878,042 $ 905,961
Based on the balance sheets given for Bethesda Mining, calculatethe following financial ratios for each year:

a. Current ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
Current ratio
2015 times
2016 times
b. Quick ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
Quick ratio
2015 times
2016 times
c. Cash ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
Cash ratio
2015 times
2016 times
d. Debt?equity ratio and equity multiplier.(Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16.)
Debt?equity ratio Equity multiplier
2015 times times
2016 times times
e. Total debt ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
Total debt ratio
2015 times
2016 times
2. Some recent financial statements for Smolira Golf, Inc.,follow.
SMOLIRA GOLF, INC.
Balance Sheets as of December 31, 2015 and 2016
2015 2016 2015 2016
Assets Liabilities and Owners’ Equity
Current assets Current liabilities
Cash $ 2,971 $ 2,907 Accounts payable $ 2,193 $ 2,680
Accounts receivable 4,727 5,701 Notes payable 1,790 2,196
Inventory 12,638 13,702 Other 98 115
Total $ 20,336 $ 22,310 Total $ 4,081 $ 4,991
Long-term debt $ 14,100 $ 16,860
Owners’ equity
Common stock and paid-in surplus $ 42,000 $ 42,000
Fixed assets Accumulated retained earnings 15,694 39,696
Net plant and equipment $ 55,539 $ 81,237 Total $ 57,694 $ 81,696
Total assets $ 75,875 $ 103,547 Total liabilities and owners’ equity $ 75,875 $ 103,547
SMOLIRA GOLF, INC.
2016 Income Statement
Sales $ 188,970
Cost of goods sold 127,003
Depreciation 5,253
EBIT $ 56,714
Interest paid 1,350
Taxable income $ 55,364
Taxes 19,377
Net income $ 35,987
Dividends $ 11,985
Retained earnings 24,002
Find the following financial ratios for Smolira Golf (useyear-end figures rather than average values where appropriate):(Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16. Enter the profitabilityratios as a percent.)
2015 2016
Short-term solvency ratios
a. Current ratio times times
b. Quick ratio times times
c. Cash ratio times times
Asset utilization ratios
d. Total asset turnover times
e. Inventory turnover times
f. Receivables turnover times
Long-term solvency ratios
g. Total debt ratio times times
h. Debt?equity ratio times times
i. Equity multiplier times times
j. Times interest earned ratio times
k. Cash coverage ratio times
Profitability ratios
l. Profit margin %
m. Return on assets %
n. Return on equity %

Answer & Explanation Solved by verified expert

4.2 Ratings (823 Votes)

Answer to Question 1 Answer a 2015 Current Ratio Current Assets Current Liabilities Current Ratio 220695 282942 Current Ratio 078 times 2016 Current Ratio Current Assets Current Liabilities Current Ratio 316683 342199 Current Ratio 093 times Answer b 2015 Quick Ratio Cash Accounts Receivable See Answer

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1. Bethesda Mining Company reports the following balance sheetinformation for 2015 and 2016.BETHESDA MINING COMPANYBalance Sheets as of December 31, 2015 and 20162015201620152016AssetsLiabilities and Owners’ EquityCurrent assetsCurrent liabilitiesCash$29,266$38,098Accounts payable$193,922$201,611Accounts receivable58,28178,639Notes payable89,020140,588Inventory133,148199,946Total$282,942$342,199Total$220,695$316,683Long-term debt$245,000$181,750Owners’ equityCommon stock and paid-in surplus$210,000$210,000Fixed assetsAccumulated retained earnings140,100172,012Net plant and equipment$657,347$589,278Total$350,100$382,012Total assets$878,042$905,961Total liabilities and owners’ equity$878,042$905,961Based on the balance sheets given for Bethesda Mining, calculatethe following financial ratios for each year:a. Current ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)Current ratio2015times2016timesb. Quick ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)Quick ratio2015times2016timesc. Cash ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)Cash ratio2015times2016timesd. Debt?equity ratio and equity multiplier.(Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16.)Debt?equity ratioEquity multiplier2015timestimes2016timestimese. Total debt ratio. (Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)Total debt ratio2015times2016times2. Some recent financial statements for Smolira Golf, Inc.,follow.SMOLIRA GOLF, INC.Balance Sheets as of December 31, 2015 and 20162015201620152016AssetsLiabilities and Owners’ EquityCurrent assetsCurrent liabilitiesCash$2,971$2,907Accounts payable$2,193$2,680Accounts receivable4,7275,701Notes payable1,7902,196Inventory12,63813,702Other98115Total$20,336$22,310Total$4,081$4,991Long-term debt$14,100$16,860Owners’ equityCommon stock and paid-in surplus$42,000$42,000Fixed assetsAccumulated retained earnings15,69439,696Net plant and equipment$55,539$81,237Total$57,694$81,696Total assets$75,875$103,547Total liabilities and owners’ equity$75,875$103,547SMOLIRA GOLF, INC.2016 Income StatementSales$188,970Cost of goods sold127,003Depreciation5,253EBIT$56,714Interest paid1,350Taxable income$55,364Taxes19,377Net income$35,987Dividends$11,985Retained earnings24,002Find the following financial ratios for Smolira Golf (useyear-end figures rather than average values where appropriate):(Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16. Enter the profitabilityratios as a percent.)20152016Short-term solvency ratiosa.Current ratiotimestimesb.Quick ratiotimestimesc.Cash ratiotimestimesAsset utilization ratiosd.Total asset turnovertimese.Inventory turnovertimesf.Receivables turnovertimesLong-term solvency ratiosg.Total debt ratiotimestimesh.Debt?equity ratiotimestimesi.Equity multipliertimestimesj.Times interest earned ratiotimesk.Cash coverage ratiotimesProfitability ratiosl.Profit margin%m.Return on assets%n.Return on equity%

BETHESDA MINING COMPANY Balance Sheets as of December 31, 2015 and 2016
	2015		2016			2015		2016
Assets					Liabilities and Owners’ Equity
Current assets					Current liabilities
Cash	$	29,266	$	38,098	Accounts payable	$	193,922	$	201,611
Accounts receivable		58,281		78,639	Notes payable		89,020		140,588
Inventory		133,148		199,946	Total	$	282,942	$	342,199
Total	$	220,695	$	316,683	Long-term debt	$	245,000	$	181,750
					Owners’ equity
					Common stock and paid-in surplus	$	210,000	$	210,000
Fixed assets					Accumulated retained earnings		140,100		172,012
Net plant and equipment	$	657,347	$	589,278	Total	$	350,100	$	382,012
Total assets	$	878,042	$	905,961	Total liabilities and owners’ equity	$	878,042	$	905,961

	Debt?equity ratio		Equity multiplier
2015		times		times
2016		times		times

SMOLIRA GOLF, INC. Balance Sheets as of December 31, 2015 and 2016
	2015		2016			2015		2016
Assets					Liabilities and Owners’ Equity
Current assets					Current liabilities
Cash	$	2,971	$	2,907	Accounts payable	$	2,193	$	2,680
Accounts receivable		4,727		5,701	Notes payable		1,790		2,196
Inventory		12,638		13,702	Other		98		115
Total	$	20,336	$	22,310	Total	$	4,081	$	4,991
					Long-term debt	$	14,100	$	16,860
					Owners’ equity
					Common stock and paid-in surplus	$	42,000	$	42,000
Fixed assets					Accumulated retained earnings		15,694		39,696
Net plant and equipment	$	55,539	$	81,237	Total	$	57,694	$	81,696
Total assets	$	75,875	$	103,547	Total liabilities and owners’ equity	$	75,875	$	103,547

SMOLIRA GOLF, INC. 2016 Income Statement
Sales			$	188,970
Cost of goods sold				127,003
Depreciation				5,253
EBIT			$	56,714
Interest paid				1,350
Taxable income			$	55,364
Taxes				19,377
Net income			$	35,987
Dividends	$	11,985
Retained earnings		24,002

		2015		2016
Short-term solvency ratios
a.	Current ratio		times		times
b.	Quick ratio		times		times
c.	Cash ratio		times		times
Asset utilization ratios
d.	Total asset turnover				times
e.	Inventory turnover				times
f.	Receivables turnover				times
Long-term solvency ratios
g.	Total debt ratio		times		times
h.	Debt?equity ratio		times		times
i.	Equity multiplier		times		times
j.	Times interest earned ratio				times
k.	Cash coverage ratio				times
Profitability ratios
l.	Profit margin				%
m.	Return on assets				%
n.	Return on equity				%