Question

Submit Save & Exit Chapter 03 Saved Help Check my work 6. BETHESDA MINING COMPANY Balance Sheets as of December 31, 2018 and 2019 2018 2019 2018 2019 Liabilities and Owners' Equity Assets Current assets Cash Current liabilities 10 $ 65,470 $82,487 65,281 $ 186,922 $ 194,611 Accounts payable Notes payable polnts Accounts receivable 85,639 181,549 82,020 133,588 Inventory 116,676 eBook $268,942 $ 328,199 Total Print 349,675 $247,427 $ Total References $ 231,000 $ 167,750 Long-term debt Owners' equity Common stock and paid-in surplus $224,000 $224,000 Accumulated retained 219,704 182,232 earnings Fixed assets Net plant and equipment $658,747 $589,978 $406,232 $443,704 Total $906 174 $939,653 Total liabilities and owners' equity $ 906,174 $939,653 Total assets Mc Graw Hill Education 6 of 10 < Prev Next >

Answer 1

a. Current Ratio = Current Assets / Current Liabilities

2018 Current Ratio = 247427 / 268942

= 0.92 times

2019 Current Ratio = 349675 / 328199

= 1.07 times

b. Quick Ratio = (Total Current Assets - Inventory - Prepaid Expenses) / Current Liabilities

2018 Quick Ratio = (247427 - 116676 - 0) / 268942

= 130750 / 268942

= 0.49 times

2019 Quick Ratio = (349675 - 181549 - 0) / 328199

= 168125 / 328199

= 0.51 times

c. Cash Ratio = ( Cash + Marketable Securities) / Current Liabilities

2018 Cash Ratio = (65470 + 0) / 268942

= 0.24 times

2019 Cash Ratio = (82487 + 0) / 328199

= 0.25 times

d. Debt Equity Ratio = ( Total Liabilities / Stockholders' Equity)

2018 Debt Equity Ratio = (268942 + 231000) / (224000 + 182232)

= 499942 / 406232

= 1.23 times

2019 Debt Equity Ratio = (328199 + 167750) / (224000 + 219704)

= 495949 / 443704

= 1.12 times

Equity Multiplier = (Total Assets / Total Equity )

2018 Equity Multiplier = 906174 / (224000 + 182232)

= 906174 / 406232

= 2.23 times

2019 Equity Multiplier = 939653 / (224000 + 219704)

= 939653 / 443704

= 2.12 times