Question

The following is a list of account titles and amounts (in millions) reported at December 27, 2015, by Hashey, Inc. a leading manufacturer of games, toys, and interactive entertainment software for children and families: $ 504 609 364 Accounts Receivable Accumulated Amortization Accumulated Depreciation Allowance for Doubtful Accounts Buildings Cash and Cash Equivalents $1,130 Equipment 759 Goodwill 514 Inventories 41 Land 254 Licensing Rights 694 Prepaid Rent 14 1,849 369 Required: 1. Prepare the asset section of a classified balance sheet for Hashev, Inc. 2. Using Hasbro's 2015 Net Sales Revenue of $4,520 (million), its Net Fixed Assets of $230 million) at December 28, 2014, and its Net Fixed Assets computed at December 27, 2015, calculate the fixed asset turnover ratio for 2015.

Answer 1

1.

Assets
Current assets
Cash and Cash Equivalents		$            694.00
Accounts Receivable	$        1,130.00
Allowance for Doubtful Accounts	$            (41.00)
Accounts Receivable (net)		$         1,089.00
Inventory		$            364.00
Prepaids		$            369.00
Total current assets			$     2,516.00
Property, Plant and Equipment
Land		$              14.00
Buildings		$            254.00
Equipment		$            504.00
Less: Accumulated Depreciation		$           (514.00)
Net Property, Plant and equipment			$        258.00
Intangible assets
Goodwill		$            609.00
Licensing Rights		$         1,849.00
Less: Accumulated Amortization		$           (759.00)
Total Intangible assets			$     1,699.00
Total assets			$     4,473.00

2.

Fixed Assets Turnover = Net Sales / Average Fixed Assets

Fixed Assets Turnover = 4520/((230+4473)/2)

Fixed Assets Turnover = 1.92

Less Revenue

Since fixed asset ratio of 2014 was much higher than current year. The company generated less revenue from each dollar of fixed assets in 2015.

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