Hendi Company has these comparative balance sheet data:
| HENDI COMPANY | ||
| 2012 | 2011 | |
| Cash | $ 15,000 | $ 30,000 |
| Receivables (net) | 70,000 | 60,000 |
| Inventories | 60,000 | 50,000 |
| Plant assets (net) | 200,000 | 180,000 |
| $345,000 | $320,000 | |
| Accounts payable | $ 50,000 | $ 60,000 |
| Mortgage payable (15%) | 100,000 | 100,000 |
| Common stock, $10 par | 140,000 | 120,000 |
| Retained earnings | 55,000 | 40,000 |
| $345,000 | $320,000 | |
Additional information for 2012:
1. Net income was $25,000.
2. Sales on account were $375,000. Sales returns and allowances amounted to $25,000.
3. Cost of goods sold was $198,000.
4. Net cash provided by operating activities was $48,000.
5. Capital expenditures were $25,000, and cash dividends were $10,000.
Instructions
Compute the following ratios at December 31, 2012.
(a) Current. (e) Days in inventory.
(b) Receivables turnover. (f ) Cash debt coverage.
(c) Average collection period. (g) Current cash debt coverage.
(d) Inventory turnover. (h) Free cash flow.
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