Which is an incorrect equation for a Balance Sheet?
Which is an incorrect equation for a Balance Sheet?
Assets-Current Liabilities = Long Term Liabilities+ Shareholders' Equity
Assets- Current Liabilities = Long Term Liabilities
Assets = Liabilities+Shareholders' Equity
Assets = Liabilities Shareholders' Equity
Question 2
To calculate a company's retained earnings start with retained earnings at the beginning of the year, add net income, subtract dividends paid, and you have up with retained earnings at the end of the year.
True
False
Question 3
For firms with slow moving inventory, the quick ratio is a better measure of liquidity than the current ratio
True
False
Homework Answers
1)
In balance sheet, Total assets = Total liabilities+Total equity. Total assets are funded with only debt and equity. Any other formula violating this principle will be incorrect.
Hence, correct option is “Assets-Current Liabilities = Long Term Liabilities”
Question 2 (3 points) To calculate a company's retained earnings start with retained earnings at the...
Question 2 (3 points) To calculate a company's retained earnings start with retained earnings at the beginning of the year, add net income, subtract dividends paid, and you have up with retained earnings at the end of the year. True False Question 3 (3 points) For firms with slow moving inventory, the quick ratio is a better measure of liquidity than the current ratio. True False Question 4 13 points)Saved Rocky Johnson just reported the following balance sheet for the...
Question 1 Which of the following is NOT true about the Balance Sheet? The balance sheet...
Question 1 Which of the following is NOT true about the Balance Sheet? The balance sheet shows Assets O The balance sheet shows retained earnings The balance sheet shows that total assets equals to liabilities plus equity Deferred revenue is NOT an item on the balance sheet. Which of the following statement is NOT true? O Current Assets are assets that can be converted into cash in a year or less O Current liabilities are liabilities that needs to be...
Building a balance sheet A firm has ($ in millions) current assets of $100, net fixed...
Building a balance sheet A firm has ($ in millions) current assets of $100, net fixed assets of $500, short-term debt of $70, and log-term debt of $200. What does the balance sheet look like? __________________ What is shareholders’ equity? __________________ What is the net working capital? __________________ Assets Liabilities and Shareholders’ equity Total assets Total liabilities and shareholders’ equity What is the firm’s current liquidity ratio? _______________ What is the firms’ long-term debt ratio? _______________
Balance Sheet December 31s (Millions of dollars) Scramouche Opera N&B Equipment Scramouche Opera Company Company Company...
Balance Sheet December 31s (Millions of dollars) Scramouche Opera N&B Equipment Scramouche Opera Company Company Company Liabilities Current liabilities N&B Equipment Company Assets Current assets Cash $861 $553 Accounts $0 payable Accounts 315 203 Accruals 190 receivable Inventories 1,012 924 $2,100 594 $1,350 1,075 $1,265 Total current $1,012 assets Notes payable Total current liabilities Long-term bonds Total debt Net fixed assets 1,547 $2,812 1,238 $2,250 Net plant and 1,650 1,650 equipment Common equity Common stock $610 328 $488 262 Retained...
QUESTION 1 Given the following income statement and balance sheet data, select which items would be...
QUESTION 1 Given the following income statement and balance sheet data, select which items would be included in presenting the cash flow from operating activities section of the statement of cash flows using the indirect method: 2019 $50,000 33,400 16,600 13,600 920 Income Statement ($ millions) Sales Less: Cost of goods sold Gross profits Less: Cash operating expenses Less: Depreciation expense Less: Amortization of intangible assets Operating profits (EBIT) Less: Interest expense Equity in earnings (loss) of affiliate Gain (loss)...
The following balance sheet information (in $ millions) comes from the Annual Report to Shareholders of...
The following balance sheet information (in $ millions) comes
from the Annual Report to Shareholders of Hotel California for the
2013 fiscal year. (Certain amounts have been replaced with question
marks to test your understanding of balance sheets.) In addition,
you’re provided with the following information from an analysis of
Hotel California’s financial position at the same date:
Current ratio = 4.78
Acid-test ratio = 0.968
Debt-to-equity ratio = 1.35
Compute the missing amounts (rounded to the nearest $ in...
Calculate the Quick Ratio for this year PETE'S POTATO & PASTA, INC. BALANCE SHEET ENDING DECEMBER...
Calculate the Quick Ratio for this
year
PETE'S POTATO & PASTA, INC. BALANCE SHEET ENDING DECEMBER 31st ASSETS This year Last year $ Current assets Cash and cash equivalents Accounts receivable Inventory Total current assets 10,000 35,000 25,000 70,000 10,000 30,000 20.000 60,000 $ Fixed assets Plants and machinery Less depreciation Land Intangible Assets TOTAL ASSETS 20,000 -12,000 8,000 2,000 88,000 20,000 -10,000 8,000 1,500 79,500 LIABILITIES and SHAREHOLDERS' EQUITY $ Liabilities Accounts payable Taxes payable Long-term bonds issued TOTAL...
gives abbreviated balance sheets and income statements for Walmart. Calculate the following using balance-sheet figures from...
gives abbreviated balance sheets and income statements for
Walmart. Calculate the following using balance-sheet figures from
the start of the year.
a) Return on assets. The tax rate is 34.5%
b) ROE
c) Assets turnover
d) Inventory turnover and average days in Inventory
e) Total Debt to Equity ratio.
f) Current ratio.
g) Quick ratio
Table 28.8 Balance sheets and income statement for Walmart, fiscal 2017 and 2016 (figures in $ millions) Fiscal 2017 Fiscal 2016 Balance Sheet Assets Current...
Sandhill Supply Company Balance Sheet as of June 30, 2017($ thousands) Assets: Liabilities and Equity: Cash...
Sandhill Supply Company Balance Sheet as of June 30, 2017($ thousands) Assets: Liabilities and Equity: Cash and marketable $396,000 Accounts payable $820,000 109,000 41,300 $970,300 1,177,000 $2,147,300 1,318,000 819,100 $2,137,100 $4,284,400 securities Accounts receivable Inventory Other current assets 711,200 Notes payable 1,156,000Accrued income taxes 42,200 Total current liabilities Total current assets $2,305,400 Long-term debt Net plant and equipment Total liabilities Common stock Retained earnings 1,979,000 Total common equity Total assets $4,284,400 Total liabilities and equity Using the 2017 data for...
Refer to the January 29, 2016, income statement and balance sheet of Lowe's Companies Inc. below....
Refer to the January 29, 2016, income statement and balance sheet of Lowe's Companies Inc. below. LOWE'S COMPANIES INC. Income Statement (In millions) For Fiscal Year Ended January 29, 2016 Net sales.............................................. Cost of sales.................................. ... Gross margin ....................................... Selling, general and administrative Depreciation.. tion......................................... Interest-net........................................ Total expenses... Pretax earnings Income tax provision ... Net earnings $59,074 38,504 20,570 14,115 1,484 552 16.151 4,419 1,873 $ 2,546 Required: Compute the following liquidity, solvency, and coverage ratios for Lowe's Companies. Interpret...
Question 2 (3 points) To calculate a company's retained earnings start with retained earnings at the beginning of the year, add net income, subtract dividends paid, and you have up with retained earnings at the end of the year. True False Question 3 (3 points) For firms with slow moving inventory, the quick ratio is a better measure of liquidity than the current ratio. True False Question 4 13 points)Saved Rocky Johnson just reported the following balance sheet for the...
Question 1 Which of the following is NOT true about the Balance Sheet? The balance sheet shows Assets O The balance sheet shows retained earnings The balance sheet shows that total assets equals to liabilities plus equity Deferred revenue is NOT an item on the balance sheet. Which of the following statement is NOT true? O Current Assets are assets that can be converted into cash in a year or less O Current liabilities are liabilities that needs to be...
Balance Sheet December 31s (Millions of dollars) Scramouche Opera N&B Equipment Scramouche Opera Company Company Company Liabilities Current liabilities N&B Equipment Company Assets Current assets Cash $861 $553 Accounts $0 payable Accounts 315 203 Accruals 190 receivable Inventories 1,012 924 $2,100 594 $1,350 1,075 $1,265 Total current $1,012 assets Notes payable Total current liabilities Long-term bonds Total debt Net fixed assets 1,547 $2,812 1,238 $2,250 Net plant and 1,650 1,650 equipment Common equity Common stock $610 328 $488 262 Retained...
QUESTION 1 Given the following income statement and balance sheet data, select which items would be included in presenting the cash flow from operating activities section of the statement of cash flows using the indirect method: 2019 $50,000 33,400 16,600 13,600 920 Income Statement ($ millions) Sales Less: Cost of goods sold Gross profits Less: Cash operating expenses Less: Depreciation expense Less: Amortization of intangible assets Operating profits (EBIT) Less: Interest expense Equity in earnings (loss) of affiliate Gain (loss)...
The following balance sheet information (in $ millions) comes
from the Annual Report to Shareholders of Hotel California for the
2013 fiscal year. (Certain amounts have been replaced with question
marks to test your understanding of balance sheets.) In addition,
you’re provided with the following information from an analysis of
Hotel California’s financial position at the same date:
Current ratio = 4.78
Acid-test ratio = 0.968
Debt-to-equity ratio = 1.35
Compute the missing amounts (rounded to the nearest $ in...
Calculate the Quick Ratio for this
year
PETE'S POTATO & PASTA, INC. BALANCE SHEET ENDING DECEMBER 31st ASSETS This year Last year $ Current assets Cash and cash equivalents Accounts receivable Inventory Total current assets 10,000 35,000 25,000 70,000 10,000 30,000 20.000 60,000 $ Fixed assets Plants and machinery Less depreciation Land Intangible Assets TOTAL ASSETS 20,000 -12,000 8,000 2,000 88,000 20,000 -10,000 8,000 1,500 79,500 LIABILITIES and SHAREHOLDERS' EQUITY $ Liabilities Accounts payable Taxes payable Long-term bonds issued TOTAL...
gives abbreviated balance sheets and income statements for
Walmart. Calculate the following using balance-sheet figures from
the start of the year.
a) Return on assets. The tax rate is 34.5%
b) ROE
c) Assets turnover
d) Inventory turnover and average days in Inventory
e) Total Debt to Equity ratio.
f) Current ratio.
g) Quick ratio
Table 28.8 Balance sheets and income statement for Walmart, fiscal 2017 and 2016 (figures in $ millions) Fiscal 2017 Fiscal 2016 Balance Sheet Assets Current...
Sandhill Supply Company Balance Sheet as of June 30, 2017($ thousands) Assets: Liabilities and Equity: Cash and marketable $396,000 Accounts payable $820,000 109,000 41,300 $970,300 1,177,000 $2,147,300 1,318,000 819,100 $2,137,100 $4,284,400 securities Accounts receivable Inventory Other current assets 711,200 Notes payable 1,156,000Accrued income taxes 42,200 Total current liabilities Total current assets $2,305,400 Long-term debt Net plant and equipment Total liabilities Common stock Retained earnings 1,979,000 Total common equity Total assets $4,284,400 Total liabilities and equity Using the 2017 data for...
Refer to the January 29, 2016, income statement and balance sheet of Lowe's Companies Inc. below. LOWE'S COMPANIES INC. Income Statement (In millions) For Fiscal Year Ended January 29, 2016 Net sales.............................................. Cost of sales.................................. ... Gross margin ....................................... Selling, general and administrative Depreciation.. tion......................................... Interest-net........................................ Total expenses... Pretax earnings Income tax provision ... Net earnings $59,074 38,504 20,570 14,115 1,484 552 16.151 4,419 1,873 $ 2,546 Required: Compute the following liquidity, solvency, and coverage ratios for Lowe's Companies. Interpret...
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