
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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12. A firm using FIFO had a beginning inventory of $48,000, an ending inventory of $56,000,
and a pretax income of $400,000. If it had used LIFO, its beginning inventory would have been
$20,000, its ending inventory would have been $16,000, and its pretax income would have been:
a. $374,000
b. $388,000
c. $396,000
d. $404,000
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- 2. Inventory is P15,000; Accounts Payable is P45,000. Cash and accounts receivable total P8,000. What is the current ratio? What is the quick ratio? 3. If current ratio is 1.5, what is the total accounts receivable if cash is P220,000, inventory is P75,000, and accounts payable is P330,000? 4. Cash is 30% of total current assets. If current ratio is 2.5, what is the new current ratio if total noncash current assets grow by 50%? 5. The total asset is P1,500,000. Sales is P4,500,000. What is the asset turnover?arrow_forwardGiven the following percentage costs of carrying inventory, calculate the annual carrying cost if the average inventory is $1 million. Capital costs are 10%, storage costsare 6%, and risk costs are 9%.arrow_forwardA company has net income of $300,000, net sales of $2,500,000, and total assets of $2,000,000. Its return on total assets equals a. 6.7%. c. 8.3%. e. 15.0%. b. 12.0%. d. 80.0%.arrow_forward
- Please solve this providearrow_forwardGiven the following information: $8 million $10 million $7 million $3 million Average Inventory: $6 million Average A/R: Average Fixed Assets: Accounts Payables:$4 million Revenues: $2 million Liabilities: Total Expenses: Cost of Goods Sold: $10 million Assume no other assets or liabilities exist beyond what is articulated above. a. Compute Net Profit Margin b. Compute Total Asset Turnover c. Compute Return on Equity (ROE) d. Compute Inventory Turnover e. How much equity would have to be swapped out for debt to increase ROE by 1% assuming that nothing else changes? f. What is the firm's sustainable growth rate if dividends are equal to $0.5 million?arrow_forwardNonearrow_forward
- 10. Current ratio is 1.4:1 with current liabilities aggregating to P50,000. Inventory and prepaid expenses amount to P35,000 and P5,000 respectively. The acid test ratio isarrow_forwardA financial analyst for Simon Manufacturing prepared the following report: Customers Customer-Level Operating Income Customer Revenue A $5041.00 $26,250 B $4202.00 $30,000 C $3368.00 $15,000 D $1069.50 $7,300 E $984.80 $5,100 F $844.80 $4,400 G $336.60 $1,800 H $252.00 $4,500 I ($168.00) $2,400 J ($676.00) $2,600 What is the cumulative customer-level operating income as a percentage of customer level operating income for the top 4 most profitable (operating income) customers? 1) 17.4% 2) 89.7% 3) 85.0% 4) 79.1%arrow_forward
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