Share
Explore BrainMass

# Ratios for the financial statement

I am have a difficult time figuring out the ratios for the financial statement of Becker, Becker and Becker. Can you help me with computing these ratios?

(See attached file for full problem description)
The balance sheet and income statement for Becker, Becker & Becker are
presented below:

Balance Sheet
Assets
Cash \$ 500
Accounts Receivable 1,500
Inventories 500
Current Assets \$2,500

Net Fixed Assets 5,000
Total Assets \$7,500

Liabilities
Accounts Payable \$1,200
Bank Note 300
Total Current Liabilities \$1,500

Long Term Debt 4,000
Total Liabilities \$5,500

Shareholders Equity
Common Stock \$300
Retained Earnings 1,700
Total Shareholder's Equity \$2,000
Total Liabilities & Equity \$7,500

Income Statement
Net Sales \$8,500
Cost of Goods Sold (3,400)
Gross Profit \$5,100

Operating Expenses (2,900)
Net Operating Income \$2,200

Interest Expense 580
Earnings before taxes \$1,620

Income Tax (34%) (551)
Net Income \$1,069

Using the above financial statements compute the following ratios: (show your formulas and work!!!) As you can see I have only provided the ending period values so you do not need to average beginning and ending values of assets and equity as in homework three) Eight ratios worth Five points total or 0.625 each.

Current Ratio
Quick Ratio
Total Debt Ratio
Return on Assets
Return on Equity
Operating profit margin
Net Profit Margin
Inventory turnover

If the market value of B&B is \$4,000 what is the market to book value ratio? 0.25 points

If there are 1000 shares outstanding what were the earnings per share? 0.25 points

#### Solution Preview

I am have a difficult time figuring out the ratios for the financial statement of Becker, Becker and Becker. Can you help me with computing these ratios?

(See attached file for full problem description)
Please see the attached file.The balance sheet and income statement for Becker, Becker & Becker are
presented below:

Balance Sheet
Assets
Cash \$ 500
Accounts Receivable 1,500
Inventories 500
Current Assets \$2,500
...

#### Solution Summary

This provides the steps for computation of ratios for the financial statement

\$2.19