The 2024 income statement of Adrian Express reports sales of $22,910, 000, cost of goods sold of $13,150,000, and net income of $2,420,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 2024 2023 Assets Current assets: Cash $1,060,000 $1,040,000 Accounts receivable 2,050,000 1,370,000 Inventory 2, 630,000 1,950,000 Long-term assets 5, 260, 000 4,520,000 Total assets $11,000,000 $8,880,000 Liabilities and Stockholders' Equity Current liabilities $2,316,000 $1,976,000 Long - term liabilities 2, 724,000 2,716, 000 Common stock 2, 350,000 2,170,000 Retained earnings 3,610,000 2,018,000 Total liabilities and stockholders' equity $11,000,000 $8,880,000 Industry averages for the following four risk ratios are as follows: Gross profit ratio 45% Return on assets 25% Profit margin 15% Asset turnover 19.5 times Return on equity 35% Required: 1. Calculate the five profitability ratios listed above for Adrian Express. 2. Do you think the company is more profitable or less profitable than the industry average?

The 2024 income statement of Adrian Express reports sales of $22,910, 000, cost of goods sold of $13,150,000, and net income of $2,420,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 2024 2023 Assets Current assets: Cash $1,060,000 $1,040,000 Accounts receivable 2,050,000 1,370,000 Inventory 2, 630,000 1,950,000 Long-term assets 5, 260, 000 4,520,000 Total assets $11,000,000 $8,880,000 Liabilities and Stockholders' Equity Current liabilities $2,316,000 $1,976,000 Long - term liabilities 2, 724,000 2,716, 000 Common stock 2, 350,000 2,170,000 Retained earnings 3,610,000 2,018,000 Total liabilities and stockholders' equity $11,000,000 $8,880,000 Industry averages for the following four risk ratios are as follows: Gross profit ratio 45% Return on assets 25% Profit margin 15% Asset turnover 19.5 times Return on equity 35% Required: 1. Calculate the five profitability ratios listed above for Adrian Express. 2. Do you think the company is more profitable or less profitable than the industry average?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 32BE

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The 2024 income statement of Adrian Express reports sales of $16,605, 000, cost of goods sold of $10,106, 000, and net income of $1,620,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 2024 2023 Assets Current assets: Cash $620, 000 $780,000 Accounts receivable 1,440,000 1,020,000 Inventory 1,840,000 1,420,000 Long -term assets 4, 820, 000 4,260, 000 Total assets $8,720,000 $7, 480,000 Liabilities and Stockholders' Equity Current liabilities $2,000,000 $1,680,000 Long - term liabilities 2, 320,000 2,420,000 Common stock 1,980,000 1,980,000 Retained earnings 2, 420,000 1,400,000 Total liabilities and stockholders' equity $8,720,000 $7, 480,000 Industry averages for the following four risk ratios are as follows: Average collection period 25 days Average days in inventory 60 days Current ratio 2 to 1 Debt to equity ratio 50% Required: 1. Calculate the four risk ratios listed above for Adrian Express in 2024. 2. Do…
The 2021 income statement of Adrian Express reports sales of $22,710,000, cost of goods sold of $13,100,000, and net income of $2,380,000. Balance sheet information is provided in the following table. ADRIAN EXPRESSBalance SheetsDecember 31, 2021 and 2020 2021 2020 Assets Current assets: Cash $ 1,040,000 $ 1,030,000 Accounts receivable 2,025,000 1,355,000 Inventory 2,595,000 1,925,000 Long-term assets 5,240,000 4,510,000 Total assets $ 10,900,000 $ 8,820,000 Liabilities and Stockholders' Equity Current liabilities $ 2,294,000 $ 1,964,000 Long-term liabilities 2,706,000 2,704,000 Common stock 2,325,000 2,155,000 Retained earnings 3,575,000 1,997,000 Total liabilities and stockholders' equity $ 10,900,000 $ 8,820,000 Industry averages for the following profitability ratios are as follows:…
The 2021 income statement of Adrian Express reports sales of $22,710,000, cost of goods sold of $13,100,000, and net income of $2,380,000. Balance sheet information is provided in the following table. ADRIAN EXPRESSBalance SheetsDecember 31, 2021 and 2020 2021 2020 Assets Current assets: Cash $ 1,040,000 $ 1,030,000 Accounts receivable 2,025,000 1,355,000 Inventory 2,595,000 1,925,000 Long-term assets 5,240,000 4,510,000 Total assets $ 10,900,000 $ 8,820,000 Liabilities and Stockholders' Equity Current liabilities $ 2,294,000 $ 1,964,000 Long-term liabilities 2,706,000 2,704,000 Common stock 2,325,000 2,155,000 Retained earnings 3,575,000 1,997,000 Total liabilities and stockholders' equity $ 10,900,000 $ 8,820,000 Industry averages for the following profitability ratios are as follows:…
The 2024 income statement of Adrian Express reports sales of $17,931,000, cost of goods sold of $11,154,000, and net income of $1,660,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets Assets Current assets: Cash Accounts receivable December 31, 2024 and 2023 2024 $660,000 1,520,000 Inventory Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term debt Common stock Retained earnings 2023 1,920,000 4,860,000 $ 8,960,000 $ 1,960,000 2,360,000 1,940,000 2,700,000 $ 820,000 1,060,000 1,460,000 4,300,000 $ 7,640,000 $ 1,720,000 2,460,000 1,940,000 1,520,000 Total liabilities and stockholders' equity $ 8,960,000 $ 7,640,000 Industry averages for the following four ratios are as follows: Average collection period Average days in inventory Current ratio Debt to equity ratio Required: 26 days 63 days 2 to 1 35% 1. Calculate the four ratios listed above for Adrian Express in 2024 assuming all sales are on…
The 2021 income statement of Adrian Express reports sales of $14,097,000, cost of goods sold of $8,154,000, and net income of $1,540,000. Balance sheet information is provided in the following table. ADRIAN EXPRESSBalance SheetsDecember 31, 2021 and 2020 2021 2020 Assets Current assets: Cash $ 540,000 $ 700,000 Accounts receivable 1,280,000 940,000 Inventory 1,680,000 1,340,000 Long-term assets 4,740,000 4,180,000 Total assets $ 8,240,000 $ 7,160,000 Liabilities and Stockholders' Equity Current liabilities $ 1,960,000 $ 1,600,000 Long-term liabilities 2,240,000 2,340,000 Common stock 1,880,000 1,880,000 Retained earnings 2,160,000 1,340,000 Total liabilities and stockholders' equity $ 8,240,000 $ 7,160,000 Industry averages for the following four risk ratios are as follows:…
The 2021 income statement of Adrian Express reports sales of $15,960,000, cost of goods sold of $9,600,000, and net income of $1,600,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2021 and 2020 2021 2020 Assets Current assets: Cash Accounts receivable $ 600,000 $ 760,000 1,400,000 1,800,000 4,800,000 $8,600,000 1,000,000 1,400,000 4,240,000 $7,400,000 Inventory Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities $2,020,000 2,300,000 2,000,000 2,280,000 $8,600,000 $1,660,000 2,400,000 2,000,000 1,340,000 $7,400,000 Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity Industry averages for the following four risk ratios are as follows: Average collection period Average days in inventory Current ratio 25 days 60 days 2 to 1 50% Debt to equity ratio
The 2024 income statement of Adrian Express reports sales of $22,910,000, cost of goods sold of $13,150,000, and net income of $2,420,000. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity Industry averages for the following four risk ratios are as follows: Gross profit ratio Return on assets. Profit margin Asset turnover Return on equity 45% 25% 15% 19.5 35% times. 2024 2023 $1,060,000 $1,040,000 2,050,000 1,370,000 2,630,000 1,950,000 5,260,000 4,520,000 $11,000,000 $8,880,000 SUPERS $2,316,000 $1,976,000 2,724,000 2,716,000 2,350,000 2,170,000 3,610,000 2,018,000 $11,000,000 $8,880,000 Required: 1. Calculate the five profitability ratios listed above for Adrian Express. 2. Do…
The 2024 income statement of Adrian Express reports sales of $14,400,000, cost of goods sold of $8,387,500, and net income of $1,550,000. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity Industry averages for the following four risk ratios are as follows: Average collection period Average days in inventory Current ratio Debt to equity ratio 25 days 60 days 2 to 1 50% 2024 2023 $550,000 1,300,000 1,700,000 4,750,000 $8,300,000 $7,200,000 $710,000 950,000 Required: 1. Calculate the four risk ratios listed above for Adrian Express in 2024. 2. Do you think the company is more risky or less risky than the industry average? 1,350,000 4,190,000 $1,970,000 $1,610,000 2,250,000 2,350,000…
The 2021 Income statement of Adrian Express reports sales of $16,932,000, cost of goods sold of $10,363,500, and net income of $1,630,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2021 and 2020 2021 2020 Assets Current assets: $ 630,000 $ 790,000 Cash Accounts receivable Inventory 1,460,000 1,860,000 4,830,000 $8,780,000 $7,520,000 1,030,000 1,430,000 4, 270,000 Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities $1,990,000 $1,690,000 2,330,000 1,970,000 2,490,000 2,430,000 1,970, 000 1,430,000 Common stock Retained earnings Total liabilities and stockholders' equity $8,780,000 $7,520,000 Industry averages for the following four risk ratios are as follows: Average collection period Average days in inventory Current ratio Debt to equity ratio 25 days 60 days 2 to 1 50% Requlred: 1. Calculate the four risk ratios listed above for Adrian Express in 2021. (Use 365 days…
The 2024 income statement of Adrian Express reports sales of $20,710,000, cost of goods sold of $12,600,000, and net income of $1,980,000. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory Long-term assets Total assets ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity Industry averages for the following four risk ratios are as follows: Gross profit ratio Return on assets Profit margin Asset turnover Return on equity 45% 25% 15% 8.5 35% times 2024 2023 $840,000 $930,000 1,775,000 1,205,000 2,245,000 1,675,000 5,040,000 4,410,000 $9,900,000 $8,220,000 $2,074,000 $1,844,000 2,526,000 2,584,000 2,075,000 2,005,000 3,225,000 1,787,000 $9,900,000 $8,220,000 Complete this question by entering your answers in the tabs below. Required: 1. Calculate the five…
Presented here are the comparative balance sheets of Hames Inc. at December 31, 2020 and 2019. Sales for the year ended December 31, 2020, totaled $630,000. HAMES INC. Balance Sheets December 31, 2020 and 2019 2020 2019 Assets Cash $ 19,000 $ 20,000 Accounts receivable 78,000 72,800 Merchandise inventory 103,000 $ 200,000 99,e00 $ 191,e00 Total current assets Land 50,000 125,000 40,000 110,000 Plant and equipment Less: Accumulated depreciation (65,000) $ 310,000 (60,e00) $ 281,000 Total assets Liabilities Short-term debt $ 18,000 $ 17,000 Accounts payable 64,000 75,500 18,000 $ 110,500 30,000 $ 140,500 other accrued liabilities Total current liabilities Long-term debt 20,000 $ 102,000 22,000 $ 124,000 Total liabilities stockholders' Equity Common stock, no par, 100,000 shares authorized 40,000 and 25, 000 shares issued, respectively Retained earnings: Beginning balance Net income for the year Dividends for the year Ending balance Total stockholders' equity $ 74,000 $ 59,000 $ 81,500 $…
Computing Activity Ratios Selected balance sheet and income statement information follows for R.A. Corporation. R.A. Corporation $ millions April 2, 2020 March 28, 2019 Income statement information: Sales $20,967 $22,353 Cost of goods sold 9,654 9,726 Balance sheet information: Accounts receivable, gross 2,313 2,718 Inventory 3,375 3,126 Accounts payable 468 630 Required Compute the following ratios for its fiscal year ended April 2, 2020. Round your answers to two decimal places (for example, enter 20.46 for 20.4555558). a. Accounts receivable turnover Answer b. Average days to collect receivables Answer c. Inventory turnover Answer d. Average days in inventory Answer e. Accounts payable turnover Answer f. Average days payable outstanding Answer g. Cash conversion cycle Answer