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Income statement and balance sheet data for Virtual Gaming Systems are provided below. |
VIRTUAL GAMING SYSTEMS
Income Statement
For the year ended December 31
2013
2012
Sales revenue
$3,510,00
0
$3,036,000
Cost of goods sold
2,480,000
1,950,000
Gross profit
1,0
30,000
1,086,000
Expenses:
Operating expenses
955,000
85
8,000
Depreciation expense
27,000
Loss on sale of land
Interest expense
18,000
15,000
Income tax expense
8,000
48,000
Total expenses
1,011,000
956,000
Net income
$ 19,000
$ 130,000
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VIRTUAL GAMING SYSTEMS |
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2013 |
2012 |
2011 |
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Assets |
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Current assets: |
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Cash |
$ 201,00 0 |
$18 6,000 |
$144,000 |
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Accounts receivable |
75,000 |
81,000 |
60,000 |
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Inventory |
125,000 |
105,000 |
135,000 |
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Prepaid rent |
14,000 |
12,000 |
6,000 | |||||
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Long-term assets: |
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Investment in bonds |
0 | |||||||
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Land |
300,000 |
210,000 |
240,000 |
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Equipment |
270,000 |
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Less: Accumulated depreciation |
(99,000) |
(69,000) |
(42,000) |
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Total assets |
$1,021,000 |
$900,000 |
$75 3,000 |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
$ 78,000 |
$ 66,000 |
$ 81,000 |
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Interest payable |
9,000 |
3,000 | ||||||
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Income tax payable |
15,000 |
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Long-term liabilities: |
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Notes payable |
400,000 |
285,000 |
225,000 |
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Stockholders’ equity: |
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Common stock |
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Retained earnings |
222,000 |
228,000 |
130,000 |
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Total liabilities and stockholders’ equity |
1.
value:
5.00 points
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Required: |
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1. |
Calculate the following risk ratios for 2012 and 2013 (Round your answers to 1 decimal place. Omit the “%” sign in your response): |
| 2012 | 2013 | |||||||
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Receivables turnover ratio |
times |
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Inventory turnover ratio |
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Current ratio |
to 1 |
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Debt to equity ratio |
% |
check my work
eBook Links (2)
references
|
Worksheet |
Learning Objective: 12-03 Use ratios to analyze a company’s risk. |
|
Difficulty: Hard |
Learning Objective: 12-04 Use ratios to analyze a company’s profitability. |
2.
value:
5.00 points
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2. |
Calculate the following profitability ratios for 2012 and 2013 (Round your answers to 1 decimal place. Omit the “%” sign in your response): |
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Gross profit ratio |
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Return on assets |
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Profit margin |
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Asset turnover |
