Frizell Company has the following comparative balance sheet data.
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FRIZELL COMPANY Balance Sheets December 31
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2015
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2014
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Cash
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$ 15,000
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$ 30,000
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Accounts receivable (net)
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70,000
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60,000
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Inventory
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60,000
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50,000
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Plant assets (net)
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200,000
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180,000
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$345,000
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$320,000
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Accounts payable
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$ 50,000
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$ 60,000
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Mortgage payable (6%)
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100,000
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100,000
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Common stock, $10 par
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140,000
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120,000
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Retained earnings
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55,000
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40,000
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$345,000
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$320,000
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Additional information for 2015:
- Net income was $25,000.
- Sales on account were $410,000. Sales returns and allowances were $20,000.
- Cost of goods sold was $198,000.
Instructions
Compute the following ratios at December 31, 2015.
(a) Current ratio.
(b) Acid-test ratio.
(c) Accounts receivable turnover.
(d) Inventory turnover.