Abdool Corporation has provided the following financial data:Balance SheetDecember 31, Year 2 and Year 1AssetsYear 2Year 1Current assets: Cash$190,000 $190,000 Accounts receivable, net 197,000 200,000 Inventory 232,000 200,000 Prepaid expenses 9,000 10,000 Total current assets 628,000 600,000 Plant and equipment, net 695,000 700,000 Total assets$ 1,323,000 $ 1,300,000 Liabilities and Stockholders' Equity Current liabilities: Accounts payable$206,000 $200,000 Accrued liabilities 104,000 90,000 Notes payable, short term 41,000 50,000 Total current liabilities 351,000 340,000 Bonds payable 130,000 130,000 Total liabilities 481,000 470,000 Stockholders'

Question

equity:        Common stock, $2 par value 160,000  160,000   Additional paid-in capital 70,000  70,000   Retained earnings 612,000  600,000 Total stockholders' equity 842,000  830,000 Total liabilities & stockholders' equity$ 1,323,000 $ 1,300,000 Income StatementFor the Year Ended December 31, Year 2Sales (all on account)$1,330,000 Cost of goods sold 740,000 Gross margin 590,000 Operating expenses 555,000 Net operating income 35,000 Interest expense 11,000 Net income before taxes 24,000 Income taxes (30%) 7,200 Net income$16,800 Required:a. What is the company's working capital at the end of Year 2?b. What is the company's current ratio at the end of Year 2?c. What is the company's acid-test (quick) ratio at the end of Year 2?d. What is the company's accounts receivable turnover for Year 2?e. What is the company's average collection period for Year 2?f. What is the company's inventory turnover for Year 2?g. What is the company's average sale period for Year 2?h. What is the company's operating cycle for Year 2?i. What is the company's total asset turnover for Year 2?

What will be an ideal response?

Answer 1