The following financial data were taken from the annual financial statements of the Smith Corporation: 1999 2000
Question:
The following financial data were taken from the annual financial statements of the Smith Corporation:
1999 2000 2001 Current assets $ 450,000 $ 400,000 $ 500,000 Current liabilities 390,000 300,000 340,000 Sales 1,450,000 1,500,000 1,400,000 Cost of goods sold 1,180,000 1,020,000 1,120,000 Inventory 280,000 200,000 250,000 Accounts receivable 120,000 110,000 105,000 Required
a. Based on these data, calculate the following for 2000 and 2001:
1. Working capital 2. Current ratio 3. Acid-test ratio 4. Accounts receivable turnover 5. Merchandise inventory turnover 6. Inventory turnover in days
b. Evaluate the results of your computations in regard to the short-term liquidity of the firm.
Step by Step Answer:
Financial Reporting And Analysis Using Financial Accounting Information
ISBN: 9780324023534
8th Edition
Authors: Charles H Gibson