The 2018 income statement of Adrian Express reports sales of $15,015,000, cost of goods sold of...

The 2018 income statement of Adrian Express reports sales of $15,015,000, cost of goods sold of $8,863,500, and net income of $1,570,000. Balance sheet information is provided in the following table.

ADRIAN EXPRESS Balance Sheets December 31, 2018 and 2017
	2018		2017
Assets
Current assets:
Cash	$	570,000	$	730,000
Accounts receivable		1,340,000		970,000
Inventory		1,740,000		1,370,000
Long-term assets		4,770,000		4,210,000

Total assets	$	8,420,000	$	7,280,000

Liabilities and Stockholders' Equity
Current liabilities	$	1,990,000	$	1,630,000
Long-term liabilities		2,270,000		2,370,000
Common stock		1,940,000		1,940,000
Retained earnings		2,220,000		1,340,000

Total liabilities and stockholders' equity	$	8,420,000	$	7,280,000

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 2018. (Use 365 days in a year. Round your answers to 1 decimal place.)

Solutions

Expert Solution

ekkarill92 answered 10 months ago

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