For each of the following liquidity ratios, indicate whether the change would be viewed as an improvement
Question:
For each of the following liquidity ratios, indicate whether the change would be viewed as an improvement or deterioration:
a. A decrease in the receivables turnover
b. A decrease in the collection period
c. An increase in the days sales in inventory
d. An increase in the inventory turnover
e. A decrease in the acid-test ratio
f. An increase in the operating cycle
Step by Step Answer:
a Deterioration A decrease in the receivables turnover would be viewed as deterioration It is taking ...View the full answer
Accounting Principles Volume 2
ISBN: 9781119786634
9th Canadian Edition
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak
Related Video
Days sales outstanding (DSO) is a measure of the average number of days that it takes a company to collect payment for a sale. DSO is often determined on a monthly, quarterly, or annual basis. To compute DSO, divide the average accounts receivable during a given period by the total value of credit sales during the same period and multiply the result by the number of days in the period being measured.
Students also viewed these Business questions
-
For each of the following liquidity ratios, indicate whether the change would be viewed as an improvement or deterioration: (a) A decrease in the receivables turnover (b) A decrease in the collection...
-
For each of the following solvency ratios, indicate whether the change would be viewed as an improvement or deterioration: a. A decrease in debt to total assets b. A decrease in interest coverage c....
-
For each of the following profitability ratios, indicate whether the change would be viewed as an improvement or deterioration: a. An increase in the gross profit margin b. A decrease in asset...
-
Modify your Digraph class from the previous exercise to make a MultiDigraph class that allows parallel edges. For a test client, run a random- surfer simulation that matches RandomSurfer (Program...
-
How are inventories presented in the income statements of Morning Java (ASPE), Leons Furniture Limited, and Shoppers Drug Mart Corporation? Is there additional information provided in the notes to...
-
Use these steps to find the antitrust claim made by the Justice Department to prevent the merger of Anheuser-Busch InBev and Grupo Modelo. Refer to the antitrust claim to answer the questions that...
-
Describe the advantages and disadvantages of microlenders that are privately owned relative to cooperatives.
-
On June 1, 2011, Logsdon Corp. issued $1,500,000, 8%, 5-year bonds at face value. The bonds were dated June 1, 2011, and pay interest semiannually on June 1 and December 1. Financial statements are...
-
Post the closing journal entries and calculate and enter balances. Assume Tobique closes its books monthly. (Post entries in the order of journal entries presented in the previous part. If the ending...
-
Virginia Tech operates its own power generating plant. The electricity generated by this plant supplies power to the university and to local businesses and residences in the Blacksburg area. The...
-
A high current ratio does not always indicate that a company has a strong liquidity position. Explain why this may be the case.
-
The following selected ratios are available for Pampered Pets Inc.: Instructions a. Has the companys collection of its receivables improved or weakened over the past three years? b. Is the company...
-
Explain whether you agree with the following statement: The Federal Reserve believes that two-thirds of the currency included in M1 is actually outside the United States. If this is correct, then M1...
-
List the three main approaches to database programming. What are the advantages and disadvantages of each approach?
-
1.It is now in January. The current interest rate is 5%. The June futures price for gold is $930.00, whereas in December futures price is $960.00. Briefly describe the transactions necessary to take...
-
Comparative balance sheets for 2024 and 2023 and a statement of income for 2024 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also...
-
In managing data movement, Ahmad is responsible for deciding the method that will be used to save data. As an experienced database administrator, how can you help Ahmad to analyze the benefits of...
-
One of the important elements of database is databse security. There are different mechanisms that can be used to ensure database security. Discuss the different security mechanisms that you can use....
-
1. Most e-book readers do not know that their reading behavior can be tracked. What ethical concerns might readers have? Are there any protections in place for consumers who may not want their...
-
7. FALSE DILEMMA 8. GANDWAGON Definition: Fallacy example: How to revise argument: Definition: Fallacy example: How to revise argument:
-
Long Trucking Corporation is a medium-sized trucking company with trucks that are driven across North America. The company owns large garages and equipment to repair and maintain the trucks. Ken...
-
At December 31, 2021, the general ledger and subsidiary ledger for Wows, a small beauty supply company, showed the following: Jan. 3 Hair Designs paid $8,000 on its account. 4 New Do paid $900 on its...
-
At December 31, 2024, the general ledger and subsidiary ledger for Alberts, a small auto parts store, showed the following: Instructions a. Record the above transactions. Ignore credit card fees and...
-
93. A user creates a customer material information record for a customer that uses a different naming method for inventory items than what the user is using. Later the user uses the record to help...
-
7. Describe how you'll steward the gift and how the organization will recognize the donor immediately following the gift being made. Think about who will be invited to the donor recognition event,...
-
Exercise 14.3 (Algo) Common Size Income Statements (LO14-1) Year 2 Year 1 Sales $ 531,000 $ 419,000 Cost of goods sold 318,600 276,540 Gross profit $ 212,400 $ 142,460 Operating expenses 100,890...
Study smarter with the SolutionInn App