Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, \(48,900; total assets, \)189,400; common stock, \(90,000; and retained earnings, \)22,748.)
CABOT CORPORATION
Income Statement
For Year Ended December 31, 2017
Sales . . . . . . . . . . . . . . . . . \(448,600
Cost of goods sold . . . . . . 297,250
Gross profit . . . . . . . . . . . . 151,350
Operating expenses . . . . . 98,600
Interest expense . . . . . . . . 4,100
Income before taxes . . . . . 48,650
Income taxes . . . . . . . . . . . 19,598
Net income . . . . . . . . . . . . \) 29,052
CABOT CORPORATION
Balance Sheet
December 31, 2017
Assets Liabilities and Equity
Cash . . . . . . . . . . . . . . . . . . . . . . . \( 10,000 Accounts payable . . . . . . . . . . . . . . . . . . . . \) 17,500
Short-term investments . . . . . . . . 8,400 Accrued wages payable . . . . . . . . . . . . . . 3,200
Accounts receivable, net . . . . . . . 29,200 Income taxes payable . . . . . . . . . . . . . . . . 3,300
Notes receivable (trade)* . . . . . . . 4,500 Long-term note payable, secured
Merchandise inventory . . . . . . . . . 32,150 by mortgage on plant assets . . . . . . . . 63,400
Prepaid expenses . . . . . . . . . . . . . 2,650 Common stock . . . . . . . . . . . . . . . . . . . . . . 90,000
Plant assets, net . . . . . . . . . . . . . . 153,300 Retained earnings . . . . . . . . . . . . . . . . . . . 62,800
Total assets . . . . . . . . . . . . . . . . . . \(240,200 Total liabilities and equity . . . . . . . . . . . . . \)240,200
* These are short-term notes receivable arising from customer (trade) sales.
Required
Compute the following:
(1) current ratio,
Round to one decimal place; for part 6, round to two decimals.
