Reference no: EM132525069
Canadian Bacon Inc. financial statements are presented in the table below.
Question 1: Based on the information in the table, calculate the firm's current ratio. Round the answers to two decimal places
Balance Sheet December 31, 2011
Cash and marketable securities $143,000
Accounts payable $278,000
Accounts receivable $354,000
Notes payable $87,000
Inventories $672,000
Accrued expenses $65,000
Prepaid expenses $12,500
Total current liabilities $430,000
Total current assets $1,181,500
Long-term debt $284,000
Gross fixed assets $1,675,000
Par value and paid-in-capital $228,000
Less: accumulated depreciation $500,000
Retained Earnings $1,414,500
Net fixed assets $1,175,000
Common Equity 1,642,500
Total assets $2,356,500
Total liabilities and owner's equity $2,356,500
Income Statement Year of 2011
Net sales (all credit) $3,136,600.00
Less: Cost of goods sold $2,195,620.00
Selling and administrative expenses $345,000.00
Depreciation expense $146,000.00
EBIT $449,980.00
Interest expense $45,300.00
Earnings before taxes $404,680.00
Income taxes $161,872.00
Net income $242,808.00