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Problem 12-6A Use ratios to analyze risk and profitability (LO12-3, 12-4)
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Income statements and balance sheets data for Virtual Gaming Systems are provided below.
VIRTUAL GAMING SYSTEMS Income Statements For the year ended December 31 2018 2019 $3,555,000 $3,081,000 Net Sales 2,489,000 Cost of goods sold 959,000 Gross profit 1.122,000 1,066,000 Expenses: operating expenses 964,000 867,000 Depreciation 39,000 31,500 expense Loss on sale of land 8,900 Interest expense 22,500 19,500 Income tax expense 8,900 52,500 Total expenses 1,034,400 979,400 31,600 14 Net Income 2,600 VIRTUAL GAMING SYSTEMS Balance Sheets December 31 2019 Current assets: 214.500 Cash Accounts receNable 88,500 inventory 38,500 Prepaid rent 4.900 Long-term assets Investment. In bonds Land 309,000 Equipment 309.000 ess: Accumula ed depreciation (121.500 Total assets $1066.900 Liabilities and Stockholders' Equity Current liabilti Accounts payable 8.200 Interest payable 11,700 ncome tax payable 2.900 Long-term liabilities: Notes payable 490.000 Stockholders' equity. Common Stoc 309,000 Retained earnings 125.100 $1066.900 Total liabilities and stockholders' equity 2018 2017 $195.000 $153,000 7080 2.900 249.000 82,500 (51.000 $941,400 $790,080 $75.000 $134,780 3.900 7800 9,500 4.900 94.000 234,000 309,000 309,000 236.100 93,500 $941,400 $790,080
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