1. Based on the following data, what is the amount of working capital? Accounts payable....................$32,000 Accounts...
1. Based on the following data, what is the amount of working
capital?
Accounts payable....................$32,000
Accounts receivable....................64,000
Accrued liabilities....................7,000
Cash.........................................20,000
Intangible assets............................40,000
Inventory...............................................72,000
Long-term investments...............................100,000
Long-term
liabilities.....................................75,000
Marketable securities.................................35,000
Notes payable (short-term)........................20,000
Property, plant, and equipment.................625,000
Prepaid
expenses.........................................2,000
WHAT IS WORKING CAPITAL?
a. $162,000
b. $134,000
c. $193,000
d. $62,000
2. Use the following data to determine the total dollar amount
of assets to be classified as current assets.
Cash..............................................$60,000
Prepaid insurance..........................40,000
Accounts receivable......................50,000
Inventory.........................................70,000
Land held for investment................80,000
Land................................................95,000
Buildings..................$100,00
Less Accumulated
Depreciation (30,000) 70,000
Trademarks 70,000
Total Assets $535,000
WHAT IS CURRENT ASSETS?
a. $220,000
b. $150,000
c. $300,000
d. $180,000
3. Cash.......................................$60,000
Prepaid insurance....................40,000
Accounts Receivable...............50,000
Inventory...................................70,000
Land held for investment..........80,000
Land..........................................95,000
Buildings..........$100,000
Less Accumulated
Depreciation.........(30,000) ..........70,000
Trademarks.............................................70,000
Total Assets.........................................$535,000
Accounts Payable............................$65,000
Salaries Payable.............................. 10,000
Mortgage Payable............................ 90,000
Total Liabilities.............
WORKING CAPITAL IS?
a. $155,000
b. $145,000
c. $60,000
d. $150,000
4. Cash.................................$50,000
Prepaid insurance............. 30,000
Accounts receivable..........40,000
Inventory............................70,000
Land held for investment...80,000
Land...................................75,000
Buildings.....$110,000
Less Accumulated
Depreciation.....(20,000)............90,000
Trademarks.........................................70,000
Total Assets.....................................$525,000
Accounts Payable..............................$55,000
Salaries payable..................................10,000
Mortgage payable................................90,000
Total Liabilities..................................$155,000
CURRENT RATIO IS?
a. 1.85: 1
b. 2.92: 1
c. 3.45: 1
d. 1.38: 1
Homework Answers
Working capital: Working capital helps business pay for its daily operations. Daily operations include purchase of machinery, selling of goods, wages payments, collection of receivables etc… working capital in mathematical terms is the difference between current assets and current liabilities.
Current assets: Current assets include cash, accounts receivable, prepaid expenses, inventory, and supplies. Current assets are expected to be realized in the operating cycle of the business.
Current liabilities: Current liabilities include liabilities with maturity less than a year and are generally payable within the operating cycle of the business. They include accounts payable, notes payable with maturity less than a year, accrued wages, etc…
Current ratio: Current ratio is current assets divided by current liabilities. It shows the amount of current assets available to pay current liabilities when they are due. It is calculated using the below formula:
(1)
Calculation of working capital is below:
Thus, amount of working capital is 
(2)
Amount of current assets is calculated using the given information:
Thus, amount of current assets is 
(3)
Calculation of working capital is below:
Thus, amount of working capital is 
(4)
Calculation of current ratio is below:
Thus, current ratio is 
Amount of working capital is $134,000
Part 2Amount of current assets is $220,000.
Part 3Amount of working capital is $145,000
Part 4Current ratio is 2.92:1
Add Answer to:
1. Based on the following data, what is the amount of working
capital?
Accounts payable....................$32,000
Accounts...
Cash Prepaid Insurance $ 25,000 40,000 Accounts Payable Salaries and Wages Payable Mortgage Payable $ 60,000...
Cash Prepaid Insurance $ 25,000 40,000 Accounts Payable Salaries and Wages Payable Mortgage Payable $ 60,000 25,000 85,000 Total Liabilities 170,000 Accounts 50,000 Receivable Inventory 80,000 Land Held for 75,000 Investment Land 120,000 Building $110,000 Less Accumulated Depreciation (20,000) 90,000 Trademark 70,000 Total Assets $550,000 Owner's Capital 380,000 Total Liabilities and Owner's $550,000 Equity The total dollar amount of liabilities to be classified as current liabilities is O a) $60,000 Ob) $85,000. Oc) $25,000 d) $170,000.
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117. Based on the following data, what is the amount of working capital? Accounts payable..... Accounts...
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Use the following data to determine the total dollar amount of assets to be classified as...
Use the following data to determine the total dollar amount of assets to be classified as current assets. Eddy Auto Supplies Balance Sheet December 31, 2017 Cash Accounts receivable Inventory Prepaid insurance Stodk investmmts Land Buildings Less Accumulated depreciation Trademarks Total assets $ 126,000 120,000 210,000 90,000 255,000 285,000 $ 165,000 30,000 270.000 $465,000 Accounts pavable Salaries and wages payable Mortgage payable Total liabilities Common stock Retained eamins Total stodholders' equity Total liabilities and todholders' equiny $360,000 750.000 $1.110000 $339,000...
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Use the following data to determine the total dollar amount of assets to be classified as current assets. Eddy Auto Supplies Balance Sheet December 31, 2017 Accounts payable Salaries and wages payable Mortgage payable Total liabilities $ 165,000 30,000 270.000 $465,000 Cash $ 126,000 Accounts receivable 120.000 Inventory 210,000 Prepaid insurance 90,000 Stock investments 255,000 Land 285,000 Buildings $339,000 Less: Accumulated depreciation (60,000 279,000 Trademarks 210.000 Total assets $1.575.000 Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders'...
Use the following data to determine the total dollar amount of assets to be classified as current assets. Eddy Auto Supplies Balance Sheet December 31, 2017 Accounts payable Salaries and wages payable Mortgage payable Total liabilities $ 165,000 30,000 270.000 $465,000 Cash $ 126,000 Accounts receivable 120.000 Inventory 210,000 Prepaid insurance 90,000 Stock investments 255,000 Land 285,000 Buildings $339,000 Less: Accumulated depreciation (60,000 279,000 Trademarks 210.000 Total assets $1.575.000 Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders'...
117. Based on the following data, what is the amount of working capital? Accounts payable..... Accounts receivable.......... Cash............. Intangible assets.............. Inventory............ Long-term Investments............ Long-liabilities........... Short-term Investments........... Notes payablo (short-term).. Plant assets....... Prepald expenses............. $31,000 57,000 15,000 50,000 69.000 80,000 100,000 40,000 28,000 670,000 1,000 couron . . .... ............... a. $123,000 b. $151,000 c. $203,000 d. $53,000 81. Expenses are incurred a. only on rare occasions. b. to produce assets. c. to produce liabilities. d. to generate revenues.
Cash $ 45,000 Accounts Payable 140,000 60,000 Prepaid Insurance 80,000 Salaries and Wages Payable Mortgage Payable 150,000 Total Liabilities 350,000 Accounts 110,000 Receivable Inventory 140,000 Land Held for 185,000 Investment Land 250,000 Building $200,000 Less Accumulated Depreciation (50,000) 150,000 Trademark 140,000 Total Assets $1.100,000 Owner's Capital 750,000 Total Liabilities and Owner's $1,100,000 Equity The total dollar amount of assets to be classified as investments is a) $0. b) $585,000. c) $725,000. d) $185.000
PROBLEM 2-Classified Balance Sheet The following information is for Benton Office Supplies Benton Office Supplies Balance Sheet December 31, 2014 $ 65,000 30,000 50,000 70,000 75,000 90,000 Accounts Payable Salaries Payable Bonds Payable Total Liabilities $ 60,000 10,000 90.000 $160,000 Cash Prepaid Insurance Accounts Receivable Inventory Land held for investment Land Building $100,000 Less Accumulated Depreciation (20,000) Patent Total Assets Owner's Equity R. Benton, Capital 370,000 80,000 70.000 $530,000 Total Liabilities and Owner's Equity $530,000 The total dollar amount of...
On January 1, 20X9, Parker acquired 90% of Sanders for $200,000 plus $15,000 in acquisition costs. On the date of acquisition, Sanders had the following balance sheet Sanders Company Balance Sheet January 1, 20x9 Assets Liabilities and Equity Accounts Receivable $40,000 Current Liabilities $110,000 100,000 100,000 Inventory 160,000 Bonds Payable 60,000 Common Stock, $1 par 150,000 Paid-in Capital (20,000) Retained Earnings 50,000 (10,000) 30,000 $460,000 Total Liabilities and Equity Land Buildings Accumulated Depreciation Equipment Accumulated Depreciation Goodwill Total Assets 50,000...
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