The following financial information is for Cullumber Company. CULLUMBER COMPANY Balance Sheets December 31 Assets 2022 2021 Cash $ 69,000 $ 69,000 Debt investments (short-term) 53,000 41,000 Accounts receivable (net) 103,000 92,000 Inventory 239,000 164,000 Prepaid expenses 25,000 29,000 Land 132,000 132,000 Building and equipment (net) 263,000 188,000 Total assets $884,000 $715,000 Liabilities and Stockholders’ Equity Notes payable (current) $170,000 $101,000 Accounts payable 66,000 54,000 Accrued liabilities 42,000 42,000 Bonds payable, due 2025 251,000 170,000 Common stock, $10 par 205,000 205,000 Retained earnings 150,000 143,000 Total liabilities and stockholders’ equity $884,000 $715,000 CULLUMBER COMPANY Income Statements For the Years Ended December 31 2022 2021 Net sales $890,000 $791,000 Cost of goods sold 643,000 576,000 Gross profit 247,000 215,000 Operating expenses 190,000 160,000 Net income $ 57,000 $ 55,000 Additional information: 1. Inventory at the beginning of 2021 was $115,000. 2. Accounts receivable (net) at the beginning of 2021 were $89,000. 3. Total assets at the beginning of 2021 were $637,000. 4. No common stock transactions occurred during 2021 or 2022. 5. All sales were on credit. (a1) Compute the liquidity and profitability ratios of Cullumber Company for 2021 and 2022. (Round current ratio, asset turnover and earnings per share to 2 decimal places, e.g. 1.83 or 1.83%. Round accounts receivables turnover, inventory turnover, profit margin and return on assets to 1 decimal place, e.g. 1.8 or 1.8%. Round % change to 0 decimal places, e.g. 25%. If % change is a decrease show the numbers as negative, e.g. -25% or (25)%.) 2022 2021 % Change LIQUIDITY Current ratio enter current ratio in rounded to 2 decimal places :1 enter current ratio in rounded to 2 decimal places :1 enter current ratio in percentage rounded to 0 decimal places % Accounts receivables turnover enter a number for accounts receivable turnover in times rounded to 1 decimal place times enter a number for accounts receivable turnover in times rounded to 1 decimal place times enter accounts receivable turnover in percentage rounded to 0 decimal places % Inventory turnover enter a number for inventory turnover in times rounded to 1 decimal place times enter a number for inventory turnover in times rounded to 1 decimal place times enter inventory turnover in percentage rounded to 0 decimal places % 2022 2021 % Change PROFITABILITY Profit margin enter profit margin in percentage rounded to 1 decimal place % enter profit margin in percentage rounded to 1 decimal place % enter profit margin in percentage rounded to 0 decimal places % Asset turnover enter a number for asset turnover in times rounded to 2 decimal places times enter a number for asset turnover in times rounded to 2 decimal places times enter asset turnover in percentage rounded to 0 decimal places % Return on assets enter return on assets in percentage rounded to 1 decimal place % enter return on assets in percentage rounded to 1 decimal place % enter return on assets in percentage rounded to 0 decimal places % Earnings per share $enter earnings per share in dollar rounded to 2 decimal places $enter earnings per share in dollar rounded to 2 decimal places enter earnings per share in percentage rounded to 0 decimal places

The following financial information is for Cullumber Company. CULLUMBER COMPANY Balance Sheets December 31 Assets 2022 2021 Cash $ 69,000 $ 69,000 Debt investments (short-term) 53,000 41,000 Accounts receivable (net) 103,000 92,000 Inventory 239,000 164,000 Prepaid expenses 25,000 29,000 Land 132,000 132,000 Building and equipment (net) 263,000 188,000 Total assets $884,000 $715,000 Liabilities and Stockholders’ Equity Notes payable (current) $170,000 $101,000 Accounts payable 66,000 54,000 Accrued liabilities 42,000 42,000 Bonds payable, due 2025 251,000 170,000 Common stock, $10 par 205,000 205,000 Retained earnings 150,000 143,000 Total liabilities and stockholders’ equity $884,000 $715,000 CULLUMBER COMPANY Income Statements For the Years Ended December 31 2022 2021 Net sales $890,000 $791,000 Cost of goods sold 643,000 576,000 Gross profit 247,000 215,000 Operating expenses 190,000 160,000 Net income $ 57,000 $ 55,000 Additional information: 1. Inventory at the beginning of 2021 was $115,000. 2. Accounts receivable (net) at the beginning of 2021 were $89,000. 3. Total assets at the beginning of 2021 were $637,000. 4. No common stock transactions occurred during 2021 or 2022. 5. All sales were on credit. (a1) Compute the liquidity and profitability ratios of Cullumber Company for 2021 and 2022. (Round current ratio, asset turnover and earnings per share to 2 decimal places, e.g. 1.83 or 1.83%. Round accounts receivables turnover, inventory turnover, profit margin and return on assets to 1 decimal place, e.g. 1.8 or 1.8%. Round % change to 0 decimal places, e.g. 25%. If % change is a decrease show the numbers as negative, e.g. -25% or (25)%.) 2022 2021 % Change LIQUIDITY Current ratio enter current ratio in rounded to 2 decimal places :1 enter current ratio in rounded to 2 decimal places :1 enter current ratio in percentage rounded to 0 decimal places % Accounts receivables turnover enter a number for accounts receivable turnover in times rounded to 1 decimal place times enter a number for accounts receivable turnover in times rounded to 1 decimal place times enter accounts receivable turnover in percentage rounded to 0 decimal places % Inventory turnover enter a number for inventory turnover in times rounded to 1 decimal place times enter a number for inventory turnover in times rounded to 1 decimal place times enter inventory turnover in percentage rounded to 0 decimal places % 2022 2021 % Change PROFITABILITY Profit margin enter profit margin in percentage rounded to 1 decimal place % enter profit margin in percentage rounded to 1 decimal place % enter profit margin in percentage rounded to 0 decimal places % Asset turnover enter a number for asset turnover in times rounded to 2 decimal places times enter a number for asset turnover in times rounded to 2 decimal places times enter asset turnover in percentage rounded to 0 decimal places % Return on assets enter return on assets in percentage rounded to 1 decimal place % enter return on assets in percentage rounded to 1 decimal place % enter return on assets in percentage rounded to 0 decimal places % Earnings per share $enter earnings per share in dollar rounded to 2 decimal places $enter earnings per share in dollar rounded to 2 decimal places enter earnings per share in percentage rounded to 0 decimal places

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 103.1C: Leverage Cook Corporation issued financial statements at December 31, 2019, that include the...

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Question

The following financial information is for Cullumber Company.

CULLUMBER COMPANY Balance Sheets December 31
Assets	2022	2021
Cash	$ 69,000	$ 69,000
Debt investments (short-term)	53,000	41,000
Accounts receivable (net)	103,000	92,000
Inventory	239,000	164,000
Prepaid expenses	25,000	29,000
Land	132,000	132,000
Building and equipment (net)	263,000	188,000
Total assets	$884,000	$715,000
Liabilities and Stockholders’ Equity
Notes payable (current)	$170,000	$101,000
Accounts payable	66,000	54,000
Accrued liabilities	42,000	42,000
Bonds payable, due 2025	251,000	170,000
Common stock, $10 par	205,000	205,000
Retained earnings	150,000	143,000
Total liabilities and stockholders’ equity	$884,000	$715,000

CULLUMBER COMPANY Income Statements For the Years Ended December 31
	2022	2021
Net sales	$890,000	$791,000
Cost of goods sold	643,000	576,000
Gross profit	247,000	215,000
Operating expenses	190,000	160,000
Net income	$ 57,000	$ 55,000

Additional information:

1.		Inventory at the beginning of 2021 was $115,000.
2.		Accounts receivable (net) at the beginning of 2021 were $89,000.
3.		Total assets at the beginning of 2021 were $637,000.
4.		No common stock transactions occurred during 2021 or 2022.
5.		All sales were on credit.

(a1)

Compute the liquidity and profitability ratios of Cullumber Company for 2021 and 2022. (Round current ratio, asset turnover and earnings per share to 2 decimal places, e.g. 1.83 or 1.83%. Round accounts receivables turnover, inventory turnover, profit margin and return on assets to 1 decimal place, e.g. 1.8 or 1.8%. Round % change to 0 decimal places, e.g. 25%. If % change is a decrease show the numbers as negative, e.g. -25% or (25)%.)

	2022		2021		% Change
LIQUIDITY
Current ratio	enter current ratio in rounded to 2 decimal places	:1		enter current ratio in rounded to 2 decimal places	:1	enter current ratio in percentage rounded to 0 decimal places	%
Accounts receivables turnover	enter a number for accounts receivable turnover in times rounded to 1 decimal place	times		enter a number for accounts receivable turnover in times rounded to 1 decimal place	times	enter accounts receivable turnover in percentage rounded to 0 decimal places	%
Inventory turnover	enter a number for inventory turnover in times rounded to 1 decimal place	times		enter a number for inventory turnover in times rounded to 1 decimal place	times	enter inventory turnover in percentage rounded to 0 decimal places	%

	2022		2021		% Change
PROFITABILITY
Profit margin	enter profit margin in percentage rounded to 1 decimal place	%		enter profit margin in percentage rounded to 1 decimal place	%	enter profit margin in percentage rounded to 0 decimal places	%
Asset turnover	enter a number for asset turnover in times rounded to 2 decimal places	times		enter a number for asset turnover in times rounded to 2 decimal places	times	enter asset turnover in percentage rounded to 0 decimal places	%
Return on assets	enter return on assets in percentage rounded to 1 decimal place	%		enter return on assets in percentage rounded to 1 decimal place	%	enter return on assets in percentage rounded to 0 decimal places	%
Earnings per share	$enter earnings per share in dollar rounded to 2 decimal places			$enter earnings per share in dollar rounded to 2 decimal places		enter earnings per share in percentage rounded to 0 decimal places	%

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