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Can someone please assist me in the calculations, I got halfway and got stuck. This is Chapter 5- Problem 23 of Hospitality Managerial Accounting Problem
Can someone please assist me in the calculations, I got halfway and got stuck.
This is Chapter 5- Problem 23 of Hospitality Managerial Accounting
Problem 23 The owner of the Martin Motel and Restaurant has asked you to prepare an income statement and balance sheet based on the following: 1. Accounts receivable = $10,000 2. Accounts payable = $15,000 3. Current assets consist of cash, accounts receivable, and inventory 4. Current liabilities consist of only accounts payable 5. Current ratio = 1.2 to 1 6. Acid-test ratio = .8 to 1 7. Accounts receivable turnover = 30 times (all sales are credit sales) 8. Food inventory turnover = 9.625 times 9. Beverage inventory turnover = 6.3525 times 10. Property and equipment turnover = 1 147 times 11. Depreciation expense = 10 percent of book value at year-end 12. Long-term debt = 9 times accounts payable 13. Interest rate = 10 percent 14. Tax rate = 20 percent 15. Average room rate = $20.00 16. Average food and beverage check = $5.00 17. Size of motel = 25 rooms 18. Occupancy percentage = 80 percent 19. Number of food and beverage checks = 30,800 20. Undistributed Operating Expenses = 33 1/3 percent of total revenue 21. Food cost percentage = 40 percent 22. Beverage cost percentage = 22 percent 23. Food and beverage labor and other cost percentage = 30 percent 24. Rooms labor and other cost percentage = 40 percent 25. Food sales = 62 1/2 percent of total food and beverage sales 26. Debt-equity ratio= 1 to 1 27. Return on owners' equity = 1.330667 percent Assume that the balance sheet at the beginning of the year is the same as at the end of the year. Note: For this problem, food and beverage is a single combined departmentStep by Step Solution
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