Use the Financial Data Shown Below to Calculate the Following

Essay

Use the financial data shown below to calculate the following ratios for the current year:
(a)Current ratio.
(b)Acid-test ratio.
(c)Accounts receivable turnover.
(d)Days' sales uncollected.
(e)Inventory turnover.
(f)Days' sales in inventory.
$$\begin{array}{l}\begin{array} { | l | r | r | } \hline\text { Income statement data }\\\hline \text { Sales } & \$ 650,000 & \\\hline \text { Cost of goods sold } & 425,000 & \\\hline \text { Income before taxes } & 78,000 & \\\hline \text { Net income } & 54,600 & \\\hline & & \\\hline & \text { Ending } & \begin{array} { c } \text { Beginning } \\\text { Balances }\end{array} \\\hline \text { Cash } & \$ 19,500 & \$ 15,000 \\\hline \text { Accounts receivable (net) } & 65,000 & 60,000 \\\hline \text { Inventory } & 71,500 & 64,500 \\\hline \text { Plant and equipment (net) } & \underline { 195,000 } & \underline { 183,900 } \\\hline \text { Total assets } & \$ 351,000 & \$ 323,400 \\\hline & & \\\hline \text { Current liabilities } & \$ 62,400 & \$ 52,700 \\\hline \text { Long-term notes payable } & 97,500 & 100,000 \\\hline\end{array}\end{array}$$