Reference no: EM131751332

Question - Changes in Various Ratios

Presented below is selected information for Brimmer Company:

	2016	2015
Sales revenue	$920,000	$840,000
Cost of goods sold	575,000	545,000
Interest expense	20,000	20,000
Income tax expense	27,000	30,000
Net income	61,000	52,000
Cash flow from operating activities	65,000	55,000
Capital expenditures	45,000	45,000
Accounts receivable (net), December 31	126,000	120,000
Inventory, December 31	196,000	160,000
Stockholders' equity, December 31	450,000	400,000
Total assets, December 31	750,000	675,000

Required -

Calculate the following ratios for 2016. The 2015 results are given for comparative purposes.

1. Gross profit percentage

2. Return on assets

3. Return on sales

4. Return on common stockholders' equity

5. Accounts receivable turnover

6. Average collection period

7. Inventory turnover

8. Times-interest-earned ratio

9. Operating-cash-flow-to-capital-expenditures ratio