Homework Answers
| a-1. | ||
| Aspen | Willow | |
| Cash | 30000 | 20000 |
| Merchandise inventory | 65000 | 35000 |
| Accounts receivable | 35000 | 40000 |
| Current assets | 130000 | 95000 |
| Aspen | Willow | |
| Wages payable | 30000 | 25000 |
| Accounts payable | 55000 | 50000 |
| Current liabilities | 85000 | 75000 |
| a-2. | ||
|
Current ratio [ Current assets / Current liabilities ] |
||
| Aspen ( 130000 / 85000 ) | 1.53 | to 1 |
| Willow ( 95000 / 75000 ) | 1.27 | to 1 |
| b. | ||
| Aspen | Willow | |
| Current liabilities | 85000 | 75000 |
| Long-term notes payable | 145000 | 110000 |
| Total liabilities | 230000 | 185000 |
| Aspen | Willow | |
| Current assets | 130000 | 95000 |
| Building | 95000 | 95000 |
| Land | 60000 | 55000 |
| Total assets | 285000 | 245000 |
|
Debt to assets ratio [ Total liabilities / Total assets ] |
|
| Aspen ( 230000 / 285000 ) | 80.7% |
| Willow ( 185000 / 245000 ) | 75.5% |
| c-1. | |
| Determine which company has the greater financial risk in the short term | Willow |
| Reason : Willow company has a lower current ratio than the Aspen | |
| c-2. | |
| Determine which company has the greater financial risk in the long term | Aspen |
| Reason : Aspen company has a higher debt to assets ratio than the Willow. | |
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Check my Wages payable Merchandise inventory Accounts receivable Long-term notes payable Aspen Willow $30.000 20,000 30,000...
Cash Wages payable Merchandise inventory Building Accounts receivable Long-term notes payable Land Accounts payable Sales revenue...
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Cash Wages payable Merchandise inventory Building Accounts receivable Long-term notes payable Land Accounts payable Sales revenue Expenses Aspen Willow $ 30,000 $20,000 30,000 25,000 65.000 35.000 95.000 95.000 35,000 40.000 145,000 110.000 60.000 55,000 55,000 50,000 325,000 265.000 295,000 230.000 Required a-1. Determine the amount of current assets and current liabilities for each company a-2. Compute the current ratio for each company. b. Assuming that all assets and liabilities are listed above, compute the debt-to-assets ratios for each company. C-1....
Problem y-20A Using ralios to make comparisons LU - The following accounting information exists for the Aspen and Willow companies: Cash Wages payable Merchandise inventory Duilding Accounts receivable Long-ter notes payable Land Accounts payable Sales revenue Expenses Aspen Willow $ 30,000 $20,000 30.000 25.000 65,000 35,000 95.000 95.000 35.000 40.000 145.000 110,000 60.000 55.000 55.000 50.000 325.000 265.000 295.000 230.000 Required 2-1. Determine the amount of current assets and current liabilities for each company a-2. Compute the current ratio for...
Problem 9-26A Using ratios to make comparisons LO 9-7 The following accounting information exists for the Aspen and Willow companies: points Cash Wages payable Merchandise inventory Building Accounts receivable Long-term notes payable Tand Accounts payable Sales revenue Expenses Aspen $ 30,000 30,000 65,000 95, 000 35,000 145,000 60,000 55.000 325,000 295,000 Willow $20,000 25,000 35,000 95.000 40,000 110,000 55,000 50.000 265,000 230.000 eBook References Required -1. Determine the amount of current assets and current liabilities for each company a-2. Compute...
Cash Investments (short-term) Accounts receivable Inventory Notes receivable (long-term) Equipment Factory building Intangibles $20,000 Accounts payable 3,200 Accrued liabilities payable 3,600 Notes payable (current) 26,000 Notes payable (noncurrent) 2,600 Common stock 50,000 Additional paid-in capital 97,000 Retained earnings 4,400 $21,000 2,600 7,300 41,000 9,500 85,500 39,900 During the current year, the company had the following summarized activities: a. Purchased short-term investments for $8,400 cash. b. Lent $5,700 to a supplier who signed a two-year note. c. Purchased equipment that cost...
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The Pioneer Company has provided the following account balances: Cash $39,400; Short-term investments $5,400; Accounts receivable $7,400; Supplies $55,000; Long-term notes receivable $3,400; Equipment $103.000; Factory Building $194,000; Intangible assets $7,400; Accounts payable $28,600; Accrued liabilities payable $3,300; Short-term notes payable $16,800; Long-term notes payable $99,000; Common stock $194,000; Retained earnings $73,300. What is Pioneer's current ratio? 4 A company's January 1, 2019 balance sheet reported total assets of $157,000 and Total liabilities of $63,500. During January 2019, the company...
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