Question
1.The comparative temporary investments and inventory balances of a company follow: Current Year Previous Year Temporary investments $36,000 $30,000 Inventory 72,000 75,000 Based on this
1.The comparative temporary investments and inventory balances of a company follow:
| Current Year | Previous Year | |
| Temporary investments | $36,000 | $30,000 |
| Inventory | 72,000 | 75,000 |
Based on this information, what is the amount and percentage of increase or decrease that would be shown on a balance sheet with horizontal analysis?
| Change in Amount | Increase/Decrease | Percentage | |
| Temporary investments | $ | % | |
| Merchandise inventory | $ | % |
2. Income statement information for Turay Corporation follows:
| Sales | $200,000 | |
| Cost of merchandise sold | 140,000 | |
| Gross profit | 60,000 |
Prepare a vertical analysis of the income statement for Turay Corporation.
| Turay Corporation | ||
| Vertical Analysis of the Income Statement | ||
| Amount | Percentage | |
| Sales | $200,000 | % |
| Cost of merchandise sold | 140,000 | % |
| Gross profit | $60,000 | % |
3. The following items are reported on a companys balance sheet:
| Cash | $120,000 |
| Marketable securities | 40,000 |
| Accounts receivable (net) | 50,000 |
| Inventory | 90,000 |
| Accounts payable | 150,000 |
Determine (a) the current ratio and (b) the quick ratio. Round your answers to one decimal place.
| a. Current ratio | |
| b. Quick ratio |
4. A company reports the following:
| Sales | $1,460,000 |
| Average accounts receivable (net) | 100,000 |
Determine (a) the accounts receivable turnover and (b) the number of days' sales in receivables. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume a 365-day year.
| a. Accounts receivable turnover | |
| b. Number of days' sales in receivables | days |
5. A company reports the following:
| Cost of merchandise sold | $558,000 |
| Average inventory | 45,000 |
Determine (a) the inventory turnover and (b) the number of days' sales in inventory. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume 365 days a year.
| a. Inventory turnover | |
| b. Number of days' sales in inventory | days |
6.
The following information was taken from Tyson Companys balance sheet:
| Fixed assets (net) | $774,000 |
| Long-term liabilities | 430,000 |
| Total liabilities | 1,218,000 |
| Total stockholders equity | 580,000 |
Determine the company's (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to stockholders' equity. If required, round your answers to one decimal place.
| a. Ratio of fixed assets to long-term liabilities | |
| b. Ratio of liabilities to stockholders' equity |
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Modern Advanced Accounting In Canada
Authors: Hilton Murray, Herauf Darrell
7th Edition
1259066487, 978-1259066481
