1)Use the Income Statement and Balance Sheet to calculate the most important 2014 working capital ratios.

a)Quick Ratio

b)Current Ratio

c)Cash Ratio

d)Receivables Turnover (use average accounts receivable)

e)Inventory Turnover (use average inventory)

f)Payables Turnover (use average accounts payable)

g)Average Collection Period (in days) (Also called Receivables Period or Day's Sales in Receivables)

h)Inventory Period

i)Payables Period

j)Operating Cycle

k)Cash Cycle

l)Return on Equity

m)Cash Collections from Customers

n)Cash Paid to Suppliers

2)For the year just ended, Hampton Bay had the following transactions:

a)A $300 dividend was paid.

b)Accounts payable decreased by $300.

c)Inventories increased by $500.

d)Long-term debt increased by $700

Label each item as a source or use of cash.

3)Indicate the impact of the following company actions on cash.Use the letter I for an increase, D for decrease or N when no change occurs:

a)A dividend is paid with funds received from a sale of debt.

b)Real estate is purchased and paid for with debt.

c)Inventory is bought for cash.

d)A bank loan is repaid.

e)Sales are made on credit.

f)Next year's taxes are prepaid.

g)Payments from previous sales are collected.

4)Bob's Auto Parts sells its inventory in 75 days, on average. Costs of goods sold for the year are $631,800. What is the average value of the firm's inventory?

Hampton Bay 2013 and 2014 Balance Sheets 2013 Current assets Cash 5 74 Accounts receivable 165 Inventory 393 Total 5 632 Fixed assets Net plant and equipment 5 2,731 Total assets S 3,363 {5 millions} 2014 Current liabilities 98 Accounts payable 178 Notes payable 422 Total 698 Longterm debt Owners' equity Common stock and 2,880 paidin surplus Retained earnings Total 3,578 Total liabilities and equity 2013 2014 S 312 S 344 S 531 s 457 Hampton Bay 2014 income Statement Sales Cost of goods sold Depreciation Earnings before interest and taxes Interest paid Taxabie income Taxes Net income Dividends additions to retained earnings