Hi,

On the above is the comparative statement of financial position which belongs to Cherrish.Co per December, 31st, 2016 and 2017

On the income statement of 2017, net sales of 120,000, cost of goods sold of 70,000, and net income of 14,000 were recorded.

Calculate the following ratios of 2017 and give the analysis based on the calculations.

a. Acid-test-ratio

b. Inventory Turnover

c. Days in Inventory

2017 2016 Land f 20,000 f 26,000 Buildings 70,000 70,000 Accumulated depreciation-buildings (15,000) (10,000) Inventory 9,000 7,000 Accounts receivable 21,200 23,400 Cash 5,300 3,700 Total (110,500 $120,100 Share capital-ordinary E 75,000 E 69,000 Retained earnings 25,130 20,000 Accounts payable 10,370 31,100 Total (110,500 E120,100