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    XYZ Corporation

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    XYZ Corporation's income statement for 2021 shows revenues of $185,000 with net income of $18,000. The balance sheet lists total assets of $113,254 including cash, inventory, and equipment, with total liabilities and equity also of $113,254. Key financial metrics include a current ratio of 18.27, inventory turnover of 24.51 days, debt ratio of 5.5%, and gross profit margin of 50.3%.

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    XYZ Corporation

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    116 views5 pages
    XYZ Corporation's income statement for 2021 shows revenues of $185,000 with net income of $18,000. The balance sheet lists total assets of $113,254 including cash, inventory, and equipment, with total liabilities and equity also of $113,254. Key financial metrics include a current ratio of 18.27, inventory turnover of 24.51 days, debt ratio of 5.5%, and gross profit margin of 50.3%.

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    XYZ Corporation's income statement for 2021 shows revenues of $185,000 with net income of $18,000. The balance sheet lists total assets of $113,254 including cash, inventory, and equipment, with total liabilities and equity also of $113,254. Key financial metrics include a current ratio of 18.27, inventory turnover of 24.51 days, debt ratio of 5.5%, and gross profit margin of 50.3%.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    116 views5 pages

    XYZ Corporation

    Uploaded by

    red
    XYZ Corporation's income statement for 2021 shows revenues of $185,000 with net income of $18,000. The balance sheet lists total assets of $113,254 including cash, inventory, and equipment, with total liabilities and equity also of $113,254. Key financial metrics include a current ratio of 18.27, inventory turnover of 24.51 days, debt ratio of 5.5%, and gross profit margin of 50.3%.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    of 5

    XYZ Corporation

    Income Statement
    For the Year Ended December 31, 2021
    Income

    Sales 185,000

    Total Income 185,000

    Expenses

    Employees’ Salaries 20,000

    Sales Commissioners 15,000

    Advertising 10,000

    Merchandise Inventory

    Beginning Merchandise Inventory 16,000

    Add: Purchases of Merchandise 85,000

    Total: Goods Available for Sale 101,000

    Less: Ending Merchandise Inventory 9,000

    Cost of Goods Sold 92,000

    Other Operating Expenses 30,000

    Total Expenses 167,000

    Net Income 18,000


    XYZ Corporation
    Balance Sheet
    December 31, 2021
    Assets

    Cash 10,000

    Accounts Receivable 9,500

    Finished Goods Inventory 3,280

    Material Inventory 474

    Building and Equipment’s 100,000

    Land 50,000

    Less: Accumulated Depreciation (60,000)

    Total Assets 113,254

    Liabilities and Owners Equity

    Liabilities

    Accounts Payable 2,200

    Income Tax Payable 4,000

    Owners Equity

    Common Stock, no par 70,000

    Retained Earnings 37,054

    Total Liabilities and Owners Equity 113,254


    XYZ Corporation
    LIQUIDITY

    Current Ratio = 113, 254

    6,200

    = 18.27

    Quick Ratio = 113,254 – 3,754

    6,200

    = 17.66

    ACTIVITY

    Inventory Turnover = 92,000

    3,754

    = 24.51

    Average Age of Inventory = 365

    24.51

    = 14.89

    Average Collection Period = 9,500

    185,000

    365

    = 9,500

    506.85

    = 18.74

    Average Payment Period 2,200

    85,000

    365

    = 2,200

    232.88

    = 9.45
    Total asset turnover = 185,000

    113,254

    = 1.63

    DEBT

    Debt Ratio = 6,200

    113,254

    = 0.055 or 5.5%

    Times Interest Earned Ratio

    = 18,000 = 4.5

    4,000

    PROFITABILITY

    Gross Profit Margin = 185,000 – 92,000

    185,000

    = 0.503

    Or

    50.3%

    Operating Profit Margin = 18, 000

    185,000

    = 0.097 or 9.7%

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