NRH Corp.Common-sizeIncome Statement Sales 100%Cost of goods sold 63 Operating expenses 21Interest expense 5Income tax 4Net income 7%Sales$8,000,000 NRH Corp.Common-sizeBalance Sheet Cash 5%Accounts receivable 20Inventory 25PP&E, net 50Total assets 100%Short-term debt 20%Long-term debt 35Common equity 45Total liabilities and equity100%Total assets$6,000,000 NRH Corp’s current ratio is closest to:1.90.1.20.2.50. NRH Corp’s times interest earned ratio is closest to:1.6.7.0.3.2.

current ratio : current assets/ current liabilities Interest Earned ratio : Income earned before…

Answered: NRH Corp. Common-size Income Statement…

Financial & Managerial Accounting

13th Edition

ISBN:9781285866307

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 15.17EX: Profitability ratios The following selected data were taken from the financial statements of...

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NRH Corp. Common-size Income Statement
Sales	100%
Cost of goods sold	63
Operating expenses	21
Interest expense	5
Income tax	4
Net income	7%
Sales	$8,000,000

NRH Corp. Common-size Balance Sheet
Cash	5%
Accounts receivable	20
Inventory	25
PP&E, net	50
Total assets	100%
Short-term debt	20%
Long-term debt	35
Common equity	45
Total liabilities and equity	100%
Total assets	$6,000,000

NRH Corp’s current ratio is closest to:

1.90.

1.20.

2.50.

NRH Corp’s times interest earned ratio is closest to:

1.6.

7.0.

3.2.

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