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Please help! Please do not waste my question if you do not know how to do it correctly. Thank you 0 O o 1. If
Please help! Please do not waste my question if you do not know how to do it correctly.
Thank you
0 O o 1. If Puddle Incorporated had total Accounts Receivable at the end of 2019 of $630 million and an allowance for uncollectible accounts of $16 million show the effect of the following in the accounting equation worksheet for 2020: Sales on credit of $4,315 million during the year Collection of accounts receivable of $4,190 million during the year Write off of uncollectible accounts of $14 million during the year An increase in the allowance for uncollectible accounts to 3% of total accounts receivable from customers Required: a) Calculate how much customers actually owe to Puddle at the end of 2020. b) Calculate how much is estimated will not be collected by Puddle at the end of 2020. c) State how much expenses increased due to the estimate of uncollectible accounts. d) How much would Puddle show as the amount they actually plan to collect (Accounts Receivable, Net) 2. If ZZBest Corp. has current assets of $24 million and current liabilities of $15 million what is the impact on the current ratio of the following transactions? Each situation is independent. a) Purchase of inventory costing $2 million on credit. b) Sell inventory costing $2 million for a sales price of $3 on credit. c) Borrowing $10 million in cash from bank that will be repaid in 5 years. d) Pay cash for a prepaid insurance policy costing $1 million and covering one year. e) Pay cash for rent expense of $1 million. Required: For each transaction indicate whether the current ratio went up or down or stayed the same and why (i.e. change in current assets, liabilities, etc.) 3. The following information was reported for Pepsi for 2020-Sales $67.1 billion and Accounts Receivable of $7.8 billion - for 2019 Accounts Receivable was $7.1 billion. For Coca Cola for 2020-Sales $37.3 billion and Accounts Receivable of $4.0 - for 2019 Accounts Receivable was $3.6 billion. With this information calculate the accounts receivable turnover and days sales in receivables for 2020 for both of these competitors. Required: a) Based on your calculations, which company is doing a more efficient job of collecting from customers. Explain. b) Based on your answers which company is the most liquid? Why? c) How much would Pepsi have to increase sales while keeping accounts receivable the same to get days sales in receivable to be 30 days? 4. For Coca Cola, 2020 COGS was $13.1 billion and 2019 COGS was $14.6 billion. Their inventory at the end of 2020 was $3.4 billion and at the end of 2019 it was $3.1 billion and at the end of 2018 it was $2.9 billion. With this information calculate the inventory turnover and days in inventory for 2020 and 2019. Required: a) Based on your calculations, in which year did Coca Cola do a more efficient job of selling inventory? Explain. b) Based on your answers did liquidity for Coca Cola get higher or lower? Explain. c) How much would Coca Cola have had to reduce their inventory at the end of 2020 to increase the number for inventory turnover to 5 times a yearStep by Step Solution
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