50.1K

Verified Solution

Link Copied!

TB PR Qu$.12-177($Algo$)$ The following income statement...

The following income statement and balance sheets for Ringling Company are provided.

RINGLING COMPANY

Income Statement

For the Year Ended December $31,2024$

Net sales $$8,740,000$

Cost of goods sold $5,370,000$

Gross profit $3,370,000$

Expenses:

Operating expenses $$1,520,000$

Depreciation expense $194,000$

Interest expense $34,000$

Income tax expense $344,000$

Total expenses $2,092,000$

Net income $$1,278,000$

RINGLING COMPANY

Balance Sheets

December $31$

$20242023$

Assets

Current assets:

Cash $$148,000$ $$198,000$

Accounts receivable $710,000730,000$

Inventory $1,325,000995,000$

Supplies $94,00069,000$

Long$-$term assets:

Equipment $1,070,0001,070,000$

Less: Accumulated depreciation $(388,000)(194,000)$

Total assets $$2,959,000$ $$2,868,000$

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable $$99,000$ $$75,000$

Interest payable $03,400$

Income tax payable $32,00029,400$

Long$-$term liabilities:

Notes payable $440,000440,000$

Stockholders' equity:

Common stock $540,000540,000$

Retained earnings $1,848,0001,780,200$

Total liabilities and stockholders$$ equity $$2,959,000$ $$2,868,000$

Required:

Assuming that all sales were on account, calculate the following risk ratios for $2024.($Use $365$ days a year. Round your final answers to $1$ decimal place.$)$ Need help on the acid$-$test ratio, debt to equity ratio, and times interest earned ratio.

Answer & Explanation Solved by verified expert

See Answer