Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The MBA 8 0 2 Company failed to record ( accrue ) $ 9 , 0 0 0 , 0 0 0 of cost related

The MBA802 Company failed to record (accrue) $9,000,000 of cost related to vendor invoices and warranty liability at year-end. With this omission, the company's summary financial statements were stated as follows:
Summarized Income Statement
Sales $97,000,000
All Cost (incl. Interest & Taxes) $83,000,000
Net Income $14,000,000
Summarized Balance Sheet
This Year Last Year
Assets:
All Current Assets combined $74,000,000 $68,000,000
All Long-Term Assets combined $61,000,000 $59,000,000
Total Assets: $135,000,000 $127,000,000
Liabilities & Stockholders Equity
All Current Liabilities combined $61,000,000 $57,000,000
All Long-Term Liabilities combined $35,000,000 $45,000,000
Stockholders Equity $39,000,000 $25,000,000
Total Liabilities & Equity $135,000,000 $127,000,000
Answer the following questions:
Current Ratio per Company Statements?
Blank 1
Current Ratio if Statements Fixed This Error?
Blank 2
Would the Current Ratio Be Better or Worse?
Blank 3
ROI per Company Statements?
Blank 4
ROI if Statements Fixed This Error?
Blank 5
Would the ROI be Better or Worse?
Blank 6
ROE per Company Statements?
Blank 7
ROE if Statements Fixed This Error?
Blank 8
Would the ROE be Better or Worse?
Blank 9
Important Notes Regarding How You Should Input Your Answers :
Display Current Ratio in the following format only x.xx (in other words, go to 2 decimal points)
Display ROI and ROE responses in the following format only x.x%(in other words, go to one decimal point and include the percentage sign)
Display the Better/Worse responses only using one of the following 2 choices: Better Worse

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions