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    Calcuating various ratios

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    Calculate the following asset activity ratios for the end of 2005:

    1. Average Collection Period
    2. Inventory Turnover
    3. Total Asset Turnover

    Please show all work, including formulae and calculations used to arrive at financial values.

    (Full problem found in attached file)

    ABC Fitness 000's
    Income Statement 5-Dec
    Sales 2,004,016
    Cost of Goods Sold 1,446,733
    Gross Profit 577,283
    Selling and Ad
    Expenses 361,402
    Depreciation 56.87
    Operating Income
    (EBIT) 139,011
    Interest expense 34,482
    Other Expense 14,124
    EBT 90,405
    Taxes 24,701
    Net Income 65,704
    Balance Sheet
    Assets
    Cash 25.32
    Net Receivables 55,514
    Inventories 141.35
    Prepaids 8,775
    Total Current
    Assests 230,959
    Gross Plant & Equipment 536.74
    Accumulated Depreciation -161.7
    Net Plant & Equipment 507.34
    Other Assets 4,621
    Total Assests 1117.96
    Liabilities
    Notes Payable 1,127
    Accounts Payable 144,638
    Taxes Payable 16,797
    Accrued Expense 98,233
    Total Current Liabilities 260,795
    Long - Term Debt 415,138
    Defferred Taxes 20,396
    Total Liabilitie 696,329

    Equity
    Common Stock 0.32
    Capital Surplus 242,843
    Retained Earnings 178,468
    Total Equity 421,631
    Total Liabilities and Equity 1117.96

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    https://brainmass.com/business/financial-ratios/calcuating-various-ratios-45422

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    1. Average Collection Period - This is calculated by dividing the net receivable at the end of the period with per day sales. The per day sale is calculated by dividing the yearly sales by 365 ( the number of days in a year). The sales are $2,004,016. The per days sale is ...

    Solution Summary

    The solution explains the calculation of Average Collection Period, Inventory Turnover and Total Asset Turnover for ABC Fitness

    $2.49

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