Current Attempt in Progress
The condensed financial statements of Oriole Company for theyears 2016 and 2017 are presented as follows. (Amounts inthousands.)
ORIOLE COMPANY
Balance Sheets
December 31 |
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| | 2017 | | 2016 |
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Current assets | | | | |
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Cash and cash equivalents | | $330 | | $360 |
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Accounts receivable (net) | | 640 | | 570 |
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Inventory | | 540 | | 470 |
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Prepaid expenses | | 120 | | 160 |
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Total current assets | | 1,630 | | 1,560 |
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Investments | | 180 | | 180 |
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Property, plant, and equipment (net) | | 420 | | 380 |
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Intangibles and other assets | | 530 | | 510 |
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Total assets | | $2,760 | | $2,630 |
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Current liabilities | | $1,070 | | $960 |
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Long-term liabilities | | 490 | | 460 |
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Stockholders’ equity—common | | 1,200 | | 1,210 |
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Total liabilities andstockholders’ equity | | $2,760 | | $2,630 |
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ORIOLE COMPANY
Income Statements
For the Year Ended December 31 |
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| | 2017 | | 2016 |
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Sales revenue | | $3,880 | | $3,540 |
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Costs and expenses | | | | |
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Cost of goods sold | | 1,125 | | 1,060 |
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Selling & administrative expenses | | 2,400 | | 2,330 |
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Interest expense | | 25 | | 20 |
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Total costs and expenses | | 3,550 | | 3,410 |
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Income before income taxes | | 330 | | 130 |
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Income tax expense | | 99 | | 39 |
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Net income | | $ 231 | | $ 91 |
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Compute the following ratios for 2017 and 2016. (Roundcurrent ratio and inventory turnover to 2 decimal places, e.g. 1.83and all other answers to 1 decimal place, e.g. 1.8 or12.6%.)
| (a) | | Current ratio. |
| (b) | | Inventory turnover. (Inventory on 12/31/15, was $360.) |
| (c) | | Profit margin. |
| (d) | | Return on assets. (Assets on 12/31/15, were $1,910.) |
| (e) | | Return on common stockholders’ equity. (Stockholders’ equity on12/31/15, was $920.) |
| (f) | | Debt to assets ratio. |
| (g) | | Times interest earned. |
| | 2017 | | 2016 |
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Current ratio. | | Enter a number rounded to 2 decimal places | :1 | | Enter a number rounded to 2 decimal places | :1 |
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Inventory turnover. | | Enter a number rounded to 2 decimal places | | | Enter a number rounded to 2 decimal places | |
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Profit margin. | | Enter percentages rounded to 1 decimal place | % | | Enter percentages rounded to 1 decimal place | % |
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Return on assets. | | Enter percentages rounded to 1 decimal place | % | | Enter percentages rounded to 1 decimal place | % |
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Return on common stockholders’ equity. | | Enter percentages rounded to 1 decimal place | % | | Enter percentages rounded to 1 decimal place | % |
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Debt to assets ratio. | | Enter percentages rounded to 1 decimal place | % | | Enter percentages rounded to 1 decimal place | % |
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Times interest earned. | | Enter a number rounded to 1 decimal place | times | | Enter a number rounded to 1 decimal place | times |
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