Question

8. Sales for the year were $76,000 and cost of goods sold were $60,800. The balance sheet at the end of the year is given below: Assets Liabilities and Equity Cash 8,000 Accounts payable 18,000 Accounts receivable 7,000 Current liabilities 18,000 Inventory 39,000 Long-term debt 95,000 Current assets 54,000 Total liabilities 113,000 Machines 34,000 Paid-in capital 20,000 Real estate 80,000 Retained earnings 35,000 Net fixed assets 114,000 Equity 55,000 Total assets 168,000 Total liab. & equity 168,000 a. What is the firm's inventory turnover (using cost of goods sold)? 9. Sales for the year were $82,000 and cost of goods sold were $65,600. The balance sheet at the end of the year is given below: Assets Liabilities and Equity Cash 13,000 Accounts payable 21,000 Accounts receivable 5,000 Current liabilities 21,000 Inventory 29,000 Long-term debt 95,000 Current assets 47,000 Total liabilities 116,000 Machines 34,000 Paid-in capital 20,000 Real estate 80,000 Retained earnings 25,000 Net fixed assets 114,000 Equity 45,000 Total assets 161,000 Total liab. & equity 161,000 a. What is the firm's collection period? b. What is the total asset turnover? 10. Sales for the year were $67,000 and cost of goods sold were $53,600. The balance sheet at the end of the year is given below: Assets Liabilities and Equity Cash 10,000 Accounts payable 19,000 Accounts receivable 6,000 Current liabilities 19,000 Inventory 26,000 Long-term debt 95,000 Current assets 42,000 Total liabilities 114,000 Machines 34,000 Paid-in capital 20,000 Real estate 80,000 Retained earnings 22,000 Net fixed assets 114,000 Equity 42,000 Total assets 156,000 Total liab. & equity 156,000 a. What is the firm's days inventory outstanding? b. What is the firm's collection period?

Answer 1

Answer to Queston- 8 Cost of goods sold Inventory Turnoves rano = Average inventory $ 60800 Cost of goods sold = Average Inventory - Since opening inventory is not availase, closing inventory is assumed to be average inventory 39000 Gogoo . Inventory turnover rasio - 39000 1.56 times ANSWER TO QUESTION-9 365 days a) Irom's collechon period Accounts Receivable turn over ratio Net (reelt sales Accounts Receivable turnover ratio Average accounts Receivable 82ooo 5000 16.40

365 from's collection penod 16.40 22.26 days Net Sales b) Total asset hom over Average total assets 82000 161000 0.51 times Answer to Question-10 Costa Average inventory a) from's days inventory outstanding -x 365 Cost of Goods sold 26000 53600 x 365 177.05 days 365 b) fram's collechon period Accounts Receivable turnover ratio Net credit sales Accounts receivable turn over= raho Avg. Account Receivase 67000 11.1666 Gooo Frams collection period 365 11.1666 32.69 days