Requirement 1. Calculate the following ratios for 2018 and 2017. When calculating days, round your answer to the nearest whole number, Print a. Current ratio. Select the formula and then enter the amounts to calculate the current ratio. (Round the ratios to two decimal places, X.XX.) (1) (2) Current ratio 2018 2017 b. Quick (acid-test) ratio. Select the formula and then enter the amounts to calculate the acid-test ratio. (Abbreviations used: Avg = average, ST = short-term, and Cash* = cash and cash equivalents. Round X.XX.) ratios to two decimal places, = + + (3) + (4) + (5) 1) (6) Acid-test ratio 2018 ( D/ 2017 (1 + c. Inventory turnover and days' inventory outstanding (DIO). Begin by selecting the formula and then enter the amounts to calculate inventory turnover (Round the ratios to two decimal places, X.XX.) ( (8) Inventory turnover 2018 2017 Now, select the formula and then enter the amounts to calculate days' inventory outstanding (DIO). (Enter formula ratios to two decimal places, X.XX, and use a 365-day year. Round your final answers to one decimal place, X.X.) (9) (10) Days' inventory outstanding (DIO) 2018 2017 d. Accounts receivable turnover. Select the formula and then enter the amounts to calculate accounts receivable turnover. (Round the ratios to two decimal places, X.XX.) (11) (12) Acounts receivable turnover 2018 1 2017 e. Days' sales in average receivables or days' sales outstanding (DSO). Select the formula and then enter the amounts to calculate days' sales in average receivables or days' sales outstanding (DSO). (Enter formula ratios to two decimal places, X.XX, and use a 365-day year. Round your final answers to one decimal place, X.X.) (13) (14) = Days' sales outstanding (DSO) 2018 2017 f. Accounts payable turnover and days' payable outstanding (DPO). Use cost of goods sold in the formula for accounts payable turnover. Begin by selecting the formula and then enter the amounts to calculate accounts payable turnover. (Round the ratios to two decimal places, X.XX.) (15) (16) Accounts payable turnover Print 2018 2017 Now, select the formula and then enter the amounts to calculate days' payable outstanding (DPO). (Enter formula ratios to two decimal places, X.XX, and use a 365-day year. Round your final answers to one decimal place, X.X.) (17) Days' payable outstanding (DPO) 2018 (18) 1 2017 g. Cash conversion cycle (in days). (Enter formula ratios and final answers to one decimal place, X.X. Abbreviations used: Avg = average and ST = short-term.) (19) (20) (21) = Cash conversion cycle 2018 2017 (23) Requirement 2. Evaluate the company's liquidity and current debt-paying ability for 2018. Has it improved or deteriorated from 2017? Ratio Improved or Deteriorated a. Current ratio (22) b. Quick (acid test) ratio C. Inventory turnover and days' inventory outstanding (DIO) (24) d. Accounts receivable turnover ( (25) e Days' sales in average receivables or days' sales outstanding (DSO) ( (26) f. Accounts payable turnover and days' payable outstanding (DPO) (27) g. Cash conversion cycle (in days) (28) Requirement 3. As a manager of this company, what would you try to improve next year? The factors that need the most improvement are (29) - and (30) The company needs to make (31) - sales and keep (32) inventory on hand, as well as (33) 1: Data Table 2018 2017 2016 S 103,000 Balance sheet: : Cash Short-term investments Net receivables Inventory 77,000 S 15,000 81,000 95,000 13,000 33,000 84,000 75,000 7,000 50,000 65,000 302.000 Prepaid expenses Total current assets Accounts payable Total current liabilities Income statement: 281,000 75,000 138,000 45,000 25,000 96,000 Net credit sales ........S 495,000 S 275,000 509,000 281,000 Cost of goods sold
