Use the information in the table below to calculate the following ratios for Windswept Woodworks for year 1 and year 2. Windswept Woodworks, Incorporated Input Data (millions of dollars) Accounts payable Accounts receivable Accumulated depreciation Cash & equivalents. Common stock Cost of goods sold Depreciation expense Common stock dividends paid. Interest expense Inventory Addition to retained earnings. Long-term debt. Notes payable Gross plant & equipment Retained earnings. Sales Other current liabilities Tax rate Year 2 interest coverage ratio Year 1 interest coverage ratio Year 2 ACP Year 1 ACP c. Current ratio Year 2 current ratio Year 1 current ratio d. Quick ratio Year 2 622 1,466 6,932 410 Year 2 quick ratio Year 1 quick ratio 1,370 1,590 days days ? ? 230 1,200 602 998 320 10,620 3,248 3,108 Market price per share-year end Number of shares outstanding (For all requirements, round your answers to 2 decimal places.) Required: a. Interest coverage ratio (Assume that year 1 EBIT was 1,307 and year 1 interest expense was 200.) 206 21% $ 27.80 Year 1 554 1,000 6,802 298 500 million 1,290 n.a. n.a. n.a. b. Average collection period (Assume that the accounts receivable balance was 1,040 on December 31 of the previous year and that year 1 sales were 2,808.) (Use 365 days in a year.) n.a. 1,196 n.a. 906 470 10,360 2,646 n.a. 186 n.a. $25.50 500 million
Use the information in the table below to calculate the following ratios for Windswept Woodworks for year 1 and year 2. Windswept Woodworks, Incorporated Input Data (millions of dollars) Accounts payable Accounts receivable Accumulated depreciation Cash & equivalents. Common stock Cost of goods sold Depreciation expense Common stock dividends paid. Interest expense Inventory Addition to retained earnings. Long-term debt. Notes payable Gross plant & equipment Retained earnings. Sales Other current liabilities Tax rate Year 2 interest coverage ratio Year 1 interest coverage ratio Year 2 ACP Year 1 ACP c. Current ratio Year 2 current ratio Year 1 current ratio d. Quick ratio Year 2 622 1,466 6,932 410 Year 2 quick ratio Year 1 quick ratio 1,370 1,590 days days ? ? 230 1,200 602 998 320 10,620 3,248 3,108 Market price per share-year end Number of shares outstanding (For all requirements, round your answers to 2 decimal places.) Required: a. Interest coverage ratio (Assume that year 1 EBIT was 1,307 and year 1 interest expense was 200.) 206 21% $ 27.80 Year 1 554 1,000 6,802 298 500 million 1,290 n.a. n.a. n.a. b. Average collection period (Assume that the accounts receivable balance was 1,040 on December 31 of the previous year and that year 1 sales were 2,808.) (Use 365 days in a year.) n.a. 1,196 n.a. 906 470 10,360 2,646 n.a. 186 n.a. $25.50 500 million
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
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Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
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Chapter15: Financial Statement Analysis
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Problem 57P: Grammatico Company has just completed its third year of operations. The income statement is as...
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Transcribed Image Text:Use the information in the table below to calculate the following ratios for Windswept Woodworks for year 1 and year 2.
Windswept Woodworks, Incorporated
Input Data
(millions of dollars)
Accounts payable
Accounts receivable
Accumulated depreciation
Cash & equivalents.
Common stock
Cost of goods sold
Depreciation expense
Common stock dividends paid.
Interest expense
Inventory
Addition to retained earnings.
Long-term debt.
Notes payable
Gross plant & equipment
Retained earnings.
Sales
Other current liabilities
Tax rate
Year 2 interest coverage ratio
Year 1 interest coverage ratio
Year 2 ACP
Year 1 ACP
c. Current ratio
Year 2 current ratio
Year 1 current ratio
d. Quick ratio
Year 2
622
1,466
6,932
410
Year 2 quick ratio
Year 1 quick ratio
1,370
1,590
days
days
?
?
230
1,200
602
998
320
10,620
3,248
3,108
Market price per share-year end
Number of shares outstanding
(For all requirements, round your answers to 2 decimal places.)
Required:
a. Interest coverage ratio (Assume that year 1 EBIT was 1,307 and year 1 interest expense was 200.)
206
21%
$ 27.80
Year 1
554
1,000
6,802
298
500 million
1,290
n.a.
n.a.
n.a.
b. Average collection period (Assume that the accounts receivable balance was 1,040 on December 31 of the previous year and that
year 1 sales were 2,808.) (Use 365 days in a year.)
n.a.
1,196
n.a.
906
470
10,360
2,646
n.a.
186
n.a.
$25.50
500 million
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