Hospitality industry Managerial accounting

Problem 9 The New K Inn has provided the following selected financial information: Balance Sheet Cash $100,000 Property and equipment $2,000,000 Income Statement Room sales $1,500,000 Food sales 500,000 Cost of food sold 150,000 Net income 200,000 Ratios Current ratio 1.4 Food inventory turnover 12 times Average collection period 20 days Solvency ratio 2.5 Assumptions: 1. The balance sheet amounts are the same at the beginning and end of the ye 2. All sales are credit sales. 3. A year has 365 days. 4. Current assets consist of cash, food inventory, and accounts receivable. 5. Cash equals $100,000. 6. Total assets consist of current assets and property and equipment. Required: 1. Calculate the amount of accounts receivable. 2. Calculate the amount of food inventory. 3. Calculate the amount of current liabilities. 4. Calculate the total amount of debt. 5. Calculate the total amount of owners' equity