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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 | $ | 198,000 | $ | 112,000 |
| Accounts receivable | | 62,000 | | 84,000 |
| Inventory | | 87,000 | | 72,000 |
| Investments | | 3,200 | | 1,200 |
| Long-term assets: | | | | |
| Land | | 400,000 | | 400,000 |
| Equipment | | 710,000 | | 590,000 |
| Less: Accumulated depreciation | | (348,000) | | (188,000) |
| | | | | |
| Total assets | $ | 1,112,200 | $ | 1,071,200 |
| | | | | |
| Liabilities and Stockholders' Equity | | | | |
| Current liabilities: | | | | |
| Accounts payable | $ | 91,000 | $ | 77,000 |
| Interest payable | | 5,000 | | 11,200 |
| Income tax payable | | 7,000 | | 4,200 |
| Long-term liabilities: | | | | |
| Notes payable | | 100,000 | | 200,000 |
| Stockholders' equity: | | | | |
| Common stock | | 620,000 | | 620,000 |
| Retained earnings | | 289,200 | | 158,800 |
| | | | | |
| Total liabilities and stockholders' equity | $ | 1,112,200 | $ | 1,071,200 |
| | | | | |
| |
Additional information for 2018:
1. Net income is $130,400.
2. Sales on account are $1,248,300.
3. Cost of goods sold is $993,750.
Required:
1. Calculate the following risk ratios for 2018: (Round your answers to 1 decimal place.)
Answer & Explanation
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