Page 722 - Accounting Principles (A Business Perspective)

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Current assets
Cash and cash equivalents $ 325,872
Short-term investments 22,969
Accounts receivable, net of allowances for doubtful account of $6,270 183,804
Other current assets 95,788
Total current assets $ 628,433
Marketable investments 26,300
Property and equipment, net 66,879
Other assets 203,271
Total assets $ 924,883
Liabilities and stockholders' equity
Current liabilities
Accounts payable and accrued expenses $ 77,144
Accrued compensation 52,112
Deferred revenue 231,495
Income taxes 1,601
Total currents liabilities $ 362,352
Other liabilities 33,989
Stockholders' equity
Preferred stock, $.01 par value; 5,000 shares authorized; none issued
Common stock, $.01 par value; 500,000 shares authorized; 276,053 2,761
(2000) and 272,277 (1999) shares issued
Additional paid-in capital 1,641,513
Foreign currency translation adjustment (12,629)
Accumulated deficit (1,036,456)
Treasury stock, at cost, 6,456 (2000) and 2,113 (1999) shares (66,647)
Total liabilities and stockholders' equity $ 924,883
• Net loss, (USD 3,980).
• Loss before interest and taxes, (USD 4,700).
• Cost of goods sold, USD 244,984.
• Net sales, USD 928,414.
• Total interest expense for the year, USD 367.
• Weighted-average number of shares outstanding, 273,081.
Calculate the following ratios and show your computations. For calculations normally involving averages, such
as average accounts receivable or average stockholders' equity, use year-end amounts if the information is not

available to use averages.
a. Current ratio.
b. Net income to average common stockholders' equity.
c. Number of days' sales in accounts receivable (assume 365 days in 2003).
d. EPS of common stock.
e. Times interest earned ratio.
f. Equity ratio.

g. Net income to net sales.
h. Total assets turnover.
i. Acid-test ratio.
Alternate problem H Paper Company is considering switching from the FIFO method to the LIFO method of
accounting for its inventory before it closes its books for the year. The January 1 merchandise inventory was USD
864,000. Following are data compiled from the adjusted trial balance at the end of the year:
Merchandise inventory, December $1,008,000
31 (FIFO)
Current liabilities 720,000
Net sales 2,520,000
Operating expenses 774,000

Accounting Principles: A Business Perspective 723 A Global Text