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The following balance sheet dated December 31, 2017, is available for Catchacoma Inc. Assets Cash $ 50,000 Marketable securities 120,000 Accounts receivable 250,000 Inventory 150,000
The following balance sheet dated December 31, 2017, is available for Catchacoma Inc. Assets Cash $ 50,000 Marketable securities 120,000 Accounts receivable 250,000 Inventory 150,000 Equipment 300,000 Total assets $870,000 Liabilities and shareholders' equity Accounts payable $120,000 Salary payable 10,000 Bonds payable 350,000 Common shares 200,000 Retained earnings 190,000 Total liabilities and shareholders' equity $870,000
Additional information: ∙ Net income for 2017 was $160,000. ∙ Dividends paid during 2017 amounted to $2 per share. ∙ No additional shares of stock were issued during the year. ∙ The shares were issued for $5 each ∙ The price/earnings ratio was 20.
Calculate for the year ended December 31, 2017: a. current ratio b. acid-test ratio c. debt ratio Industry bench marks: current ratio 1.90 acid test 1.50 debt ratio .80
Based upon your calculations comment on the business’s ability to pay their current liabilities
The following balance sheet dated December 31, 2017, is available for Catchacoma Inc.
Assets
Cash $ 50,000
Marketable securities 120,000
Accounts receivable 250,000
Inventory 150,000
Equipment 300,000
Total assets $870,000
Liabilities and shareholders' equity
Accounts payable $120,000
Salary payable 10,000
Bonds payable 350,000
Common shares 200,000
Retained earnings 190,000
Total liabilities and shareholders' equity $870,000
Additional information: ∙
Net income for 2017 was $160,000. ∙
Dividends paid during 2017 amounted to $2 per share. ∙
No additional shares of stock were issued during the year. ∙
The shares were issued for $5 each ∙
The price/earnings ratio was 20.
Calculate for the year ended December 31, 2017:
a. current ratio b. acid-test ratio c. debt ratio
Industry bench marks:
current ratio 1.90 acid test 1.50 debt ratio .80
Based upon your calculations comment on the business’s ability to pay their current liabilities
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Given Information Current Assets Cash 50000 Marketable Securities 120000 Accounts Receivable 250000 Inventory 150000 Current Liabilities Accounts Paya...
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Financial and Managerial Accounting the basis for business decisions
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
16th edition
0077664078, 978-0077664077, 78111048, 978-0078111044
