need help wit part one a, b, c, etc.

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David · Accepted Answer

SOLUTION a: 
Computation of Earnings before interest & tax 
Particulars 
Amount 
(in '000 
dollars) 
Sales ($1,168.2 * 97%)  $           1,133.15  
Cost of goods sold ($837.7 * 97%)  $              812.57
Gross Profit  $              320.59  
Financing Cost  $                  2.00  
Allowance for Accounts 
Receivable  $                17.46  
Depreciation  $                38.58  
Loss on sale of operations  $                13.71  
Selling & Administration 
Expenses  $              131.30  
Earnings before interest & tax  $             117.53  
 
Ratio Analysis: 
Current Ratio = Current Assets / Current Liabilities 
Current Assets = $52.4 + $295.50 + $256.20 + $17.20 + $36.70 
Current Assets = $658 
Current Liabilities = $105.60 + $10.90 + $81.60 
Current Liabilities = $198.10 
Current Ratio = $658 / $198.10 
Current Ratio = 3.32 times 
Inventory Turnover Ratio = Cost of goods sold / Average Inventory 
Average Inventory = (Beginning Inventory + Ending Inventory) / 2 
Average Inventory = ($162.30 + $256.

need help wit part one a, b, c, etc.

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