Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Cash $ 110,000 Notes payable (due in 6 months) $ 45,000 Accounts receivable 150,000 Accounts payable 123,000 Inventory 270,000 Long-term liabilities 326,000 Prepaid expenses 60,000

Cash $ 110,000 Notes payable (due in 6 months) $ 45,000
Accounts receivable 150,000 Accounts payable 123,000
Inventory 270,000 Long-term liabilities 326,000
Prepaid expenses 60,000 Capital stock, $5 par 300,000
Plant & equipment (net) 570,000 Retained earnings 456,000
Other assets 90,000
Total $ 1,250,000 Total $ 1,250,000

During the year the company earned a gross profit of $1,116,000 on sales of $2,950,000. Accounts receivable, inventory, and plant assets remained almost constant in amount throughout the year, so year-end figures may be used rather than averages.

a. Compute the current ratio. (Round your answer to 2 decimal place.)

b. Compute the quick ratio. (Round your answer to 2 decimal place.)

c. Compute the working capital.

d. Compute the debt ratio. (Round your percentage answers to nearest whole percent. i.e. 0.1234 as 12%.)

e. Compute the accounts receivable turnover (all sales were on credit). (Round your answer to 2 decimal places.)

f. Compute the inventory turnover. (Round your answer to 2 decimal places.)

g. Compute the book value per share of capital stock. (Round your answer to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

5. Describe how contexts affect listening

Answered: 1 week ago