Hilda Company Ratio Analysis: Compute Six Financial Ratios
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Compute the specified ratios using Hilda Company balance sheet at December 31, 2011
Assets
Cash $15,000.00
Marketable securities $8,000.00
Accounts receivable $13,000.00
Inventory $11,000.00
Property and equipment $170,000.00
Accumulated depreciation ($12,500.00)
Total Assets $204,500
Equities
Accounts payable $8500.00
Current notes payable $3500.00
Mortgage payable $4500.00
Bonds payable $21,500.00
Common Stock $114,000.00
Retained earnings $52,500.00
Total liabilities and stockholders' equity $204,500
The average number of common stock shares outstanding during 2011 was 880 shares. Net income for the year was $15,000.00
Required:
Compute each of the following:
a. Current Ratio
b. Earnings per share
c. Quick( acid-test) ration
d. Return on investment
e. Return on equity
f. Debt to equity ratio.
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Solution Summary
The solution assists with computing six financial ratios.
Solution Preview
a. Current ratio: $47,000 ÷ $12,000 = 3.92:1
b. Earnings per share: $15,000 ÷ 880 = $17.05 per ...
Education
- BA, Ain Shams University, Cairo Egypt
- MBA, California State University, Sacramento
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