Homework Answers
| a | ||
| Current ratio = Current Assets / Current Liabilities | ||
| Current ratio: | ||
| Kansas | 1.5 | =59000/40000 |
| Montana | 1.8 | =78000/43000 |
| b |
| Montana has greater likelihood of being able to pay its bills, as it's current ratio is higher and has higher liquidity. |
| c |
| Montana would produce higher return-on-assets ratio. |
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The following information was drawn from the balance sheets of the Kansas and Montana companies: Current...
The following transactions apply to Ozark Sales for Year 1: 1. The business was started when the company receiv...
The following transactions apply to Ozark Sales for Year 1: 1. The business was started when the company received $48.500 from the issue of common stock 2. Purchased equipment inventory of $176,500 on account 3. Sold equipment for $195,500 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $120,500. 4. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would...
The following information was drawn from the balance sheets of two companies: Company Assets = Liabilities...
The following information was drawn from the balance sheets of
two companies:
Company
Assets
=
Liabilities
+
Equity
East
207,000
78,000
129,000
West
606,000
158,000
448,000
Required
a. Compute the debt-to-assets ratio to measure the
level of financial risk of both companies.
b. Compare the two ratios computed in requirement
a to identify which company has the higher level of financial
risk.
East 207,000 606,000 78,000 158,000 129,000 448,000 West Required a. Compute the debt-to-assets ratio to measure the level...
The following information was drawn from the balance sheets of two companies: 10 Company East West...
The following information was drawn from the balance sheets of two companies: 10 Company East West Assets 201,000 597,000 Liabilities 81,000 174,000 + Equity 120,000 423,000 1.17 points Required a. Compute the debt-to-assets ratio to measure the level of financial risk of both companies. b. Compare the two ratios computed in requirement a to identify which company has the higher level of fi eBook Complete this question by entering your answers in the tabs below. Hint Required A Required B...
The following information was drawn from the balance sheets of two companies: Company Assets = Liabilities...
The following information was drawn from the balance sheets of two companies: Company Assets = Liabilities + Equity East 203,000 77,000 126,000 West 608,000 178,000 430,000 Required a. Compute the debt-to-assets ratio to measure the level of financial risk of both companies. b. Compare the two ratios computed in requirement a to identify which company has the higher level of financial risk.
The balance sheets for Plasma Screens Corporation and additional information are provided below PLASMA SCREENS CORPORATION Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Current assets:...
The balance sheets for Plasma Screens Corporation and additional information are provided below PLASMA SCREENS CORPORATION Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Current assets: Cash Accounts rece Inventory Investments $128,500 76,000 94,000 3,900 119,000 91,000 79,000 1,900 ivable Long-term assets: Land Equipment Less: Accumulated depreciation 470,000 780,000 (418,000) 470,000 660,000 (258,000) $ 1,134,400$ 1,162,900 Total assets Liabilities and Stockholders' Equity Current liabilities Accounts paya Interest payable Income tax payable $98,000 $84,000 11,900 4,900 ble 6,000 8,000...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies s...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies should maintain the highest current ratio possible. Higher current ratios suggest greater liquidity. Companies should maintain the lowest current ratio possible. Which of the following would not likely appear on a classified balance sheet? Multiple Choice Current assets Long-term liabilities Current retained earnings Long-term assets
Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs...
Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago $ 31,900 $ 34,700 $ 37,200 88,600 62,500 53,300 43,574 82,700 56,500 11, 1558, 7593, 342 394,771 241, 341 159, 658 $570,000 $430,000 $ 310,000 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and...
Required information (The following information applies to the questions displayed below.] Simon Company's year-end balance sheets...
Required information (The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. Current yr 1 Yr Ago 2 Yrs Ago At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity $ 30,000 87,700 112,500 10,800 280,000 $521,000 $ 35,250 $ 37,400 62,000 49,500...
Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 19,000 $...
Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 19,000 $ 35,000 Accounts receivable, net 37,400 54,400 Merchandise inventory 84,340 134,500 Prepaid expenses 5,800 7,600 Plant assets, net 320,000 305, 400 Total assets $466,540 $536,900 Barco Kyan Company Company Data from the current year's income statement Sales $ 790,000 $901,200 cost of goods sold 591 100 640, 500 Interest expense 8,500 16,000 Income tax expense 15 185 24,879 Net income 175, 215 219,821 Basic earnings...
Barco Company Kyan Company Barco Company Kyan Company Data from the current year end balance sheets...
Barco Company Kyan Company Barco Company Kyan Company Data from the current year end balance sheets Assets Accounts 19,500 37,400 9.100 84.440 5,000 290,000 $445,440 Data from the current year's income statement Sales $770,000 Cost of goods sold 585,100 Interest expense 7.900 Income tax expense 14.800 Net income 162.200 Basic earnings per share Cach dividend per sham $ 34,000 57.400 7.200 132.500 6,950 304,400 $542.450 Merchandise inventory $880,200 632.500 13,000 24,300 210,400 5.1 Total assets Liabilities and Equity 579,500S 54,200...
The following transactions apply to Ozark Sales for Year 1: 1. The business was started when the company received $48.500 from the issue of common stock 2. Purchased equipment inventory of $176,500 on account 3. Sold equipment for $195,500 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $120,500. 4. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would...
The following information was drawn from the balance sheets of
two companies:
Company
Assets
=
Liabilities
+
Equity
East
207,000
78,000
129,000
West
606,000
158,000
448,000
Required
a. Compute the debt-to-assets ratio to measure the
level of financial risk of both companies.
b. Compare the two ratios computed in requirement
a to identify which company has the higher level of financial
risk.
East 207,000 606,000 78,000 158,000 129,000 448,000 West Required a. Compute the debt-to-assets ratio to measure the level...
The following information was drawn from the balance sheets of two companies: 10 Company East West Assets 201,000 597,000 Liabilities 81,000 174,000 + Equity 120,000 423,000 1.17 points Required a. Compute the debt-to-assets ratio to measure the level of financial risk of both companies. b. Compare the two ratios computed in requirement a to identify which company has the higher level of fi eBook Complete this question by entering your answers in the tabs below. Hint Required A Required B...
The balance sheets for Plasma Screens Corporation and additional information are provided below PLASMA SCREENS CORPORATION Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Current assets: Cash Accounts rece Inventory Investments $128,500 76,000 94,000 3,900 119,000 91,000 79,000 1,900 ivable Long-term assets: Land Equipment Less: Accumulated depreciation 470,000 780,000 (418,000) 470,000 660,000 (258,000) $ 1,134,400$ 1,162,900 Total assets Liabilities and Stockholders' Equity Current liabilities Accounts paya Interest payable Income tax payable $98,000 $84,000 11,900 4,900 ble 6,000 8,000...
Which of the following statements is true? Multiple Choice Lower current ratios suggest greater liquidity. Companies should maintain the highest current ratio possible. Higher current ratios suggest greater liquidity. Companies should maintain the lowest current ratio possible. Which of the following would not likely appear on a classified balance sheet? Multiple Choice Current assets Long-term liabilities Current retained earnings Long-term assets
Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago $ 31,900 $ 34,700 $ 37,200 88,600 62,500 53,300 43,574 82,700 56,500 11, 1558, 7593, 342 394,771 241, 341 159, 658 $570,000 $430,000 $ 310,000 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and...
Required information (The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. Current yr 1 Yr Ago 2 Yrs Ago At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity $ 30,000 87,700 112,500 10,800 280,000 $521,000 $ 35,250 $ 37,400 62,000 49,500...
Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 19,000 $ 35,000 Accounts receivable, net 37,400 54,400 Merchandise inventory 84,340 134,500 Prepaid expenses 5,800 7,600 Plant assets, net 320,000 305, 400 Total assets $466,540 $536,900 Barco Kyan Company Company Data from the current year's income statement Sales $ 790,000 $901,200 cost of goods sold 591 100 640, 500 Interest expense 8,500 16,000 Income tax expense 15 185 24,879 Net income 175, 215 219,821 Basic earnings...
Barco Company Kyan Company Barco Company Kyan Company Data from the current year end balance sheets Assets Accounts 19,500 37,400 9.100 84.440 5,000 290,000 $445,440 Data from the current year's income statement Sales $770,000 Cost of goods sold 585,100 Interest expense 7.900 Income tax expense 14.800 Net income 162.200 Basic earnings per share Cach dividend per sham $ 34,000 57.400 7.200 132.500 6,950 304,400 $542.450 Merchandise inventory $880,200 632.500 13,000 24,300 210,400 5.1 Total assets Liabilities and Equity 579,500S 54,200...
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