Question

The comparative statements of Simpson Company are shown below. SIMPSON COMPANY Income Statements For the Years Ended December 31 2020 2019 Net sales $780,000 $624,000 Cost of goods sold 440,000 405,600 Gross profit 340,000 218,400 Selling and administrative expenses 176,880 149,760 Income from operations 163,120 68,640 Other expenses and losses Interest expense 9,920 7,200 Income before income taxes 153,200 61,440 Income tax expense 34,000 14,000 Net income $119,200 $ 47,440 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $138,200 $132,000 Income taxes payable 25,300 24,000 Total current liabilities 163,500 156,000 Bonds payable 132,000 120,000 Total liabilities 295,500 276,000 Stockholders’ equity Common stock ($10 par) 150,000 130,000 Retained earnings 330,300 246,000 Total stockholders’ equity 480,300 376,000 Total liabilities and stockholders’ equity $775,800 $652,000 All sales were on account. Net cash provided by operating activities was $108,000. Capital expenditures were $47,000, and cash dividends were $30,900. Instructions Compute the following ratios for 2019: . (a) Earnings per share.                                                                           (h) Days in inventory. (b) Return on common stockholders’ equity.                                             (i) Times interest earned. (c) Return on assets.                                                                               (j) Asset turnover. (d) Current ratio.                                                                                     (k) Debt to assets ratio. (e) Accounts receivable turnover.                                                             (l) Current cash debt coverage. (f) Average collection period.                                                                 (m) Cash debt coverage. (g) Inventory turnover.                                                                            (n) Free cash flow.

Answer 1