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The balance sheets for Plasma Screens Corporation and additional information are provided below.
| PLASMA SCREENS CORPORATION Balance Sheets December 31, 2018 and 2017 |
| | 2018 | 2017 |
| Assets | | | | |
| Current assets: | | | | |
| Cash | $ | 116,800 | $ | 120,000 |
| Accounts receivable | | 78,000 | | 92,000 |
| Inventory | | 95,000 | | 80,000 |
| Investments | | 4,000 | | 2,000 |
| Long-term assets: | | | | |
| Land | | 480,000 | | 480,000 |
| Equipment | | 790,000 | | 670,000 |
| Less: Accumulated depreciation | | (428,000) | | (268,000) |
| | | | | |
| Total assets | $ | 1,135,800 | $ | 1,176,000 |
| | | | | |
| Liabilities and Stockholders' Equity | | | | |
| Current liabilities: | | | | |
| Accounts payable | $ | 99,000 | $ | 85,000 |
| Interest payable | | 6,000 | | 12,000 |
| Income tax payable | | 8,000 | | 5,000 |
| Long-term liabilities: | | | | |
| Notes payable | | 100,000 | | 200,000 |
| Stockholders' equity: | | | | |
| Common stock | | 700,000 | | 700,000 |
| Retained earnings | | 222,800 | | 174,000 |
| | | | | |
| Total liabilities and stockholders' equity | $ | 1,135,800 | $ | 1,176,000 |
| | | | | |
| |
Additional information for 2018:
1. Net income is $48,800.
2. Sales on account are $1,521,500.
3. Cost of goods sold is $1,163,750.
Required:
1. Calculate the following profitability ratios for 2018: (Round your answers to 1 decimal place.)
Answer & Explanation
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