Question

→ c e dugen.wileyplus.com/edugen/student/mainfr.uni Presented below is information related to Skysong Inc. SKYSONG INC. BALANCE SHEET DECEMBER 31, 2017 $44,600 $109,100 14,900 Cash Receivables Less: Allowance Inventory Prepaid insurance Land Equipment (net) Notes payable (short-term) Accounts payable Accrued liabilities Common stock (par $5) Retained earnings $50,400 31,800 5,100 261,900 138,700 94,200 170,100 8,100 19,900 151,000 $487,900 $487,900 $1,408,500 SKYSONG INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue Cost of goods sold Inventory, Jan. 1, 2017 $200,600 Purchases 784,000 Cost of goods available for sale 984,600 Inventory, Dec. 31, 2017 (170,100) Cost of goods sold Gross profit on sales Type here to search 814,500 594,000

Answer 1

	1	Current ratio
		Current ratio=	Current asset
			Current liabilities
		Current ratio=	317,000
			87,300
		Current ratio=	3.6312
		Current assets
		Cash	44,600
		Receivable net of allowances	94,200
		inventory	170,100
		Prepaid Insurance	8,100
		Total Current asset	317,000
		Current liabilities
		Accounts Payable	31,800
		Accrued liabilities	5,100
		Notes Payable	50,400
		Total Current liabilities	87,300
	2	Inventory Turnover
		Inventory Turnover=	Cost of goods sold
			Average inventory
		Inventory Turnover=	814,500
			185,350
		Inventory Turnover=	4.39
		Average inventory=	(Opening inventory+closing inventory)/2
		Average inventory=	(200,600+170,100)/2
		Average inventory=	185,350
	3	Accounts receivable Turnover
		Accounts receivable Turnover=	Credit sales
			Average Accounts receivable
	Note:-	It is assumed that all sales are credit sales only and in the absence of previous year accounts receivable it is assumed that given accounts receivable are average accounts receivable
		Accounts receivable Turnover on gross receivable=	1,408,500
			109,100
		Accounts receivable Turnover on gross receivable=	12.91
		Accounts receivable Turnover on net receivable=	1,408,500
			94,200
		Accounts receivable Turnover on gross receivable=	14.95
	4	Earning per share
		Earning per share=	Earning attributable to common stock holder
			Weighted average no of common stock
		Earning per share=	Net income
			No of common stock
		Earning per share=	425,000
			52,380
		Earning per share=	8.11
		No of common stock	$
		value of common stock	261900
		Face value of common stock	5
		No of common stock	52,380