Homework Answers
1. Current ratio : The ideal current seriously is '2'. If the firm has adequate arrangements with its bankers to meet it's short term requirements of funds, then ideal ratio of 1.5 is also acceptable.This ratio is an index of firm financial stability since it shows the extent to which current assets exceeds current liabilities. The higher current ratio would indicate inadequate employment of funds while poor current ratio is danger signal to the management.
2. Acid test ratio : The ideal ratio is '1'. The ratio is an indicator of short term solvency of the company. A comparison of current ratio to quick ratio also indicate the inventory holdups.
3. Accounts receivable turnover: It indicates the efficiency and effectiveness of the company in collecting receivables. The ratio shows how well the company uses and manages the credit it extends to customers and how quickly the short term debt is collected or being paid.
4. Inventory Turnover : The ratio indicates whether investment in inventory is efficiently used and whether it is within proper limits. This ratio signifies the liquidity of inventory. The high inventory ratio indicates brisk sales. The ratio is therefore a measure to discover possible trouble in the form of over stocking or over valuation of inventory.
5. Return on assets : Return on assets is an indicator of how profitable a company is relative to its total assets. ROA gives the investor an idea of how efficient a company management is using it's assets to generate earnings.
6.Profit margin on sales : Profit margin ratio directly measures what percentage of sales is made up of net income. This ratio indirectly measures how a company manages it's expenses relative to net sales.
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only question b please.
PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory...
only question b please. PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory...
only question b please.
PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory Prepaid expenses Total Current Assets Property, plant and Equipment (net) Total Assets Current Liabilities Bonds Payable Common stockholder's equity Total liabilities and stockholder's equity Dec. 31 2017 $ 52,000 198,000 80,000 440,000 3,000 $ 773,000 857,000 $ 1,630,000 240,000 400,000 990,000 $ 1,630,000 Dec 31 2016 $ 60,000 80,000 40,000 360,000 7,000 $ 547,000 853,000 $ 1.400,000 160,000 400,000 840.000 $1,400,000 INCOME STATEMENT FOR...
E 13-18 Prior Company's condensed financial statements provide the following information PRIOR COMPANY BALANCE SHEET Cash...
E 13-18 Prior Company's condensed financial statements provide the following information PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory Prepaid expenses Total Current Assets Property. Plant and Equipment (net) Total Assets Current Liabilities Bonds Payable Common stockholder's equity Total liabilities and stockholder's equity Dec. 31 2017 $ 52,000 198,000 80,000 440,000 3,000 $ 773,000 857,000 $ 1,630,000 240,000 400,000 990,000 $ 1,630,000 Dec. 31 2016 $ 60,000 80,000 40.000 360,000 7,000 $ 547,000 853,000 $ 1,400,000...
WILDHORSE COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory 2022 2021...
WILDHORSE COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory 2022 2021 $ 70,000 $68,000 51,000 40,000 109,000 91,000 231,000 167,000 27,000 26,000 134,000 134,000 264,000 186,000 $886,000 $712,000 Prepaid expenses Land Building and equipment (net) Total assets Liabilities and Stockholders' Equity Notes payable $171,000 $109,000 Accounts payable 67,000 53,000 Accrued liabilities 41,000 41,000 Bonds payable, due 2025 250,000 170,000 Common stock, $10 par 206,000 151,000 206,000 133,000 Retained earnings Total liabilities and stockholders' equity $886,000...
CABOT CORPORATION Balance Sheet December 31, 2817 Assets Cash Short-term investments Accounts receivable, net Notes receivable...
CABOT CORPORATION Balance Sheet December 31, 2817 Assets Cash Short-term investments Accounts receivable, net Notes receivable (trade) Merchandise inventory Liabilities and Equity $12,e8 Accounts payable 28,888 Income taxes payable 38,15e Long-term note payable, secured by $15,58e 4,000 3,188 8, Accrued wages payable 5,580 65,488 mortgage on plant assets Prepaid expenses Plant assets, net Total assets 3,ee Common stock 154,3e8 Retained earnings 77,75e 249,758 Total liabilities and equity $ 249,75e These are short-term notes recelvable arising from customer (trade) sales. Requlrec...
Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 95,900 Debt investments (short-term) 75,350 Accounts...
Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 95,900 Debt investments (short-term) 75,350 Accounts receivable 142.480 Inventory 315.100 Prepaid expenses 34,250 Land 178,100 Building and equipment (net) 356,200 Total assets $1,197,380 Liabilities and Stockholders' Equity Notes payable (short-term) $232,900 Accounts payable 89,050 Accrued liabilities 54,800 Bonds payable, due 2023 342.500 Common stock, 510 par 274.000 Retained earning 204,130 Total liabilities and stockholders' equity $1.197.380 2019 $ 89,050 54,800 123,300 226,050 31,510 178,100 253.450 $956 260 $164.400 71.240 54,800...
Calculate the ratios below given the financial data presented to your left. Answers Measures of Short-term...
Calculate the ratios below given the financial data presented to your left. Answers Measures of Short-term Liquidity current assets / current liabilities quick assets / current liabilities net sales /accounts receivable 365 days/receivables turnover rate cost of goods sold/inventory current ratio quick ratico receivables turnover rate days to collect receivables inventory turnover rate Measures of Long-term Credit Risk total liabilities/total assets operating income /annual interest expense debt ratio Times Interest Earned Measures of Profitability net income / sales net income/total...
CULLUMBER COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets Liabilities...
CULLUMBER COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets Liabilities and Stockholders' Equity Notes payable Accounts payable Accrued liabilities Bonds payable, due 2017 Common stock, $10 par Retained earnings 2017 2016 69,000 69,000 41,000 103,000 92,000 239,000 164,000 25,000 29,000 132,000 132,000 263,000 188,000 $884,000 $715,000 53,000 $170,000 $101,000 66,000 54,000 42,000 251,000 170,000 205,000 205,000 150,000 143,000 Total liabilities and stockholders' equity $884,000 $715,000 42,000...
BLOSSOM COMPANY Balance Sheets December 31 Assets 2022 Cash $ 72,000 Debt investments (short-term) 54,000 Accounts...
BLOSSOM COMPANY Balance Sheets December 31 Assets 2022 Cash $ 72,000 Debt investments (short-term) 54,000 Accounts receivable 109,000 Inventory 235,000 Prepaid expenses 26,000 Land 134,000 Building and equipment (net) 259,000 Total assets $889,000 Liabilities and Stockholders' Equity Notes payable $170,000 Accounts payable 66,000 Accrued liabilities 41,000 Bonds payable, due 2025 249,000 Common stock, $10 par 198,000 Retained earnings 165,000 Total liabilities and stockholders' equity $889,000 - 2021 $ 67,000 39,000 92,000 164,000 27,000 134,000 185,000 $708,000 $102,000 54,000 41,000 171,000...
2019 Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 136,500 Debt investments (short-term) 107,250...
2019 Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 136,500 Debt investments (short-term) 107,250 Accounts receivable 202,800 Inventory 448,500 Prepaid expenses 48,750 Land 253,500 Building and equipment (net) 507,000 Total assets $1,704,300 Liabilities and Stockholders' Equity Notes payable (short-term) $331,500 Accounts payable 126,750 Accrued liabilities 78,000 Bonds payable, due 2023 487,500 Common stock, $10 par 390,000 Retained earnings 290,550 Total liabilities and stockholders' equity $1,704,300 $ 126,750 78,000 175,500 321,750 44,850 253,500 360,750 $1,361,100 $234,000 101,400 78,000 331,500...
FIN Company: Balance Sheet as of December 31 ($ million) $40 Cash Account receivables Inventories Total...
FIN Company: Balance Sheet as of December 31 ($ million) $40 Cash Account receivables Inventories Total current assets $40 $20 $100 $40 Account Payables ? Notes payable $160 Other current liabilities $310 Total current liabilities Long-term debt Total liabilities Common stock Retained earnings Total stockholders' equity $450 Total liabilities and equity $140 $114 ? Net fixed assets Total assets FIN Company: Income Statement for Year Ended December 31 ($ million) $800.0 Net sales Cost of goods sold (80% of net...
only question b please.
PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory Prepaid expenses Total Current Assets Property, plant and Equipment (net) Total Assets Current Liabilities Bonds Payable Common stockholder's equity Total liabilities and stockholder's equity Dec. 31 2017 $ 52,000 198,000 80,000 440,000 3,000 $ 773,000 857,000 $ 1,630,000 240,000 400,000 990,000 $ 1,630,000 Dec 31 2016 $ 60,000 80,000 40,000 360,000 7,000 $ 547,000 853,000 $ 1.400,000 160,000 400,000 840.000 $1,400,000 INCOME STATEMENT FOR...
E 13-18 Prior Company's condensed financial statements provide the following information PRIOR COMPANY BALANCE SHEET Cash Accounts Receivables (net) Short Term Investments Inventory Prepaid expenses Total Current Assets Property. Plant and Equipment (net) Total Assets Current Liabilities Bonds Payable Common stockholder's equity Total liabilities and stockholder's equity Dec. 31 2017 $ 52,000 198,000 80,000 440,000 3,000 $ 773,000 857,000 $ 1,630,000 240,000 400,000 990,000 $ 1,630,000 Dec. 31 2016 $ 60,000 80,000 40.000 360,000 7,000 $ 547,000 853,000 $ 1,400,000...
WILDHORSE COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory 2022 2021 $ 70,000 $68,000 51,000 40,000 109,000 91,000 231,000 167,000 27,000 26,000 134,000 134,000 264,000 186,000 $886,000 $712,000 Prepaid expenses Land Building and equipment (net) Total assets Liabilities and Stockholders' Equity Notes payable $171,000 $109,000 Accounts payable 67,000 53,000 Accrued liabilities 41,000 41,000 Bonds payable, due 2025 250,000 170,000 Common stock, $10 par 206,000 151,000 206,000 133,000 Retained earnings Total liabilities and stockholders' equity $886,000...
CABOT CORPORATION Balance Sheet December 31, 2817 Assets Cash Short-term investments Accounts receivable, net Notes receivable (trade) Merchandise inventory Liabilities and Equity $12,e8 Accounts payable 28,888 Income taxes payable 38,15e Long-term note payable, secured by $15,58e 4,000 3,188 8, Accrued wages payable 5,580 65,488 mortgage on plant assets Prepaid expenses Plant assets, net Total assets 3,ee Common stock 154,3e8 Retained earnings 77,75e 249,758 Total liabilities and equity $ 249,75e These are short-term notes recelvable arising from customer (trade) sales. Requlrec...
Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 95,900 Debt investments (short-term) 75,350 Accounts receivable 142.480 Inventory 315.100 Prepaid expenses 34,250 Land 178,100 Building and equipment (net) 356,200 Total assets $1,197,380 Liabilities and Stockholders' Equity Notes payable (short-term) $232,900 Accounts payable 89,050 Accrued liabilities 54,800 Bonds payable, due 2023 342.500 Common stock, 510 par 274.000 Retained earning 204,130 Total liabilities and stockholders' equity $1.197.380 2019 $ 89,050 54,800 123,300 226,050 31,510 178,100 253.450 $956 260 $164.400 71.240 54,800...
Calculate the ratios below given the financial data presented to your left. Answers Measures of Short-term Liquidity current assets / current liabilities quick assets / current liabilities net sales /accounts receivable 365 days/receivables turnover rate cost of goods sold/inventory current ratio quick ratico receivables turnover rate days to collect receivables inventory turnover rate Measures of Long-term Credit Risk total liabilities/total assets operating income /annual interest expense debt ratio Times Interest Earned Measures of Profitability net income / sales net income/total...
CULLUMBER COMPANY Balance Sheets December 31 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets Liabilities and Stockholders' Equity Notes payable Accounts payable Accrued liabilities Bonds payable, due 2017 Common stock, $10 par Retained earnings 2017 2016 69,000 69,000 41,000 103,000 92,000 239,000 164,000 25,000 29,000 132,000 132,000 263,000 188,000 $884,000 $715,000 53,000 $170,000 $101,000 66,000 54,000 42,000 251,000 170,000 205,000 205,000 150,000 143,000 Total liabilities and stockholders' equity $884,000 $715,000 42,000...
BLOSSOM COMPANY Balance Sheets December 31 Assets 2022 Cash $ 72,000 Debt investments (short-term) 54,000 Accounts receivable 109,000 Inventory 235,000 Prepaid expenses 26,000 Land 134,000 Building and equipment (net) 259,000 Total assets $889,000 Liabilities and Stockholders' Equity Notes payable $170,000 Accounts payable 66,000 Accrued liabilities 41,000 Bonds payable, due 2025 249,000 Common stock, $10 par 198,000 Retained earnings 165,000 Total liabilities and stockholders' equity $889,000 - 2021 $ 67,000 39,000 92,000 164,000 27,000 134,000 185,000 $708,000 $102,000 54,000 41,000 171,000...
2019 Priscoll Company Balance Sheets December 31 Assets 2020 Cash $ 136,500 Debt investments (short-term) 107,250 Accounts receivable 202,800 Inventory 448,500 Prepaid expenses 48,750 Land 253,500 Building and equipment (net) 507,000 Total assets $1,704,300 Liabilities and Stockholders' Equity Notes payable (short-term) $331,500 Accounts payable 126,750 Accrued liabilities 78,000 Bonds payable, due 2023 487,500 Common stock, $10 par 390,000 Retained earnings 290,550 Total liabilities and stockholders' equity $1,704,300 $ 126,750 78,000 175,500 321,750 44,850 253,500 360,750 $1,361,100 $234,000 101,400 78,000 331,500...
FIN Company: Balance Sheet as of December 31 ($ million) $40 Cash Account receivables Inventories Total current assets $40 $20 $100 $40 Account Payables ? Notes payable $160 Other current liabilities $310 Total current liabilities Long-term debt Total liabilities Common stock Retained earnings Total stockholders' equity $450 Total liabilities and equity $140 $114 ? Net fixed assets Total assets FIN Company: Income Statement for Year Ended December 31 ($ million) $800.0 Net sales Cost of goods sold (80% of net...
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