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Calculate appropriate ratios to make comment on the financial performance of the company? *The industry average current ratio is at 1:1 and quick ratio at 0.6:1.

Calculate appropriate ratios to make comment on the financial performance of the company? *The industry average current ratio is at 1:1 and quick ratio at 0.6:1.

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 16MCQ
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Question 10: Assets Current Assets Cash Petty cash Accounts receivable Inventory Total current assets Property and equipment Buildings Land Equipment Accumulated depreciation Total property and equipment Other assets Total Assets 20,000 5,000 35,000 70,000 150,000 10,000 80,000 -20,000 BUNNY BACKERS Inc. Balance sheet 31-Dec-20XX 130,000 220,000 8,000 358,000 Liabilities Current Liabilities Accounts payable Wages payable Interests payable Unearned revenues Total current liabilities Long term liabilities Notes payable Total Liabilities Equity Common stock Retained earnings Total stockholder's equity Total liabilities and equity 35,000 25,000 10,000 8,000 240,000 80,000 78,000 60,000 138,000 220,000 358,000
Transcribed Image Text:Question 10: Assets Current Assets Cash Petty cash Accounts receivable Inventory Total current assets Property and equipment Buildings Land Equipment Accumulated depreciation Total property and equipment Other assets Total Assets 20,000 5,000 35,000 70,000 150,000 10,000 80,000 -20,000 BUNNY BACKERS Inc. Balance sheet 31-Dec-20XX 130,000 220,000 8,000 358,000 Liabilities Current Liabilities Accounts payable Wages payable Interests payable Unearned revenues Total current liabilities Long term liabilities Notes payable Total Liabilities Equity Common stock Retained earnings Total stockholder's equity Total liabilities and equity 35,000 25,000 10,000 8,000 240,000 80,000 78,000 60,000 138,000 220,000 358,000
Bunny Backers Inc. Income Statement for the Year Ended 31st Dec. 20XX 120,000 40,000 80,000 Revenues Cost of goods sold Gross profit Other income Selling costs Administrative costs Other expenses Profit before tax Taxes Net Profit 40,000 20,000 30,000 10,000 60,000 21,000 39,000 Calculate appropriate ratios to make comment on the financial performance of the company? *The industry average current ratio is at 1:1 and quick ratio at 0.6:1.
Transcribed Image Text:Bunny Backers Inc. Income Statement for the Year Ended 31st Dec. 20XX 120,000 40,000 80,000 Revenues Cost of goods sold Gross profit Other income Selling costs Administrative costs Other expenses Profit before tax Taxes Net Profit 40,000 20,000 30,000 10,000 60,000 21,000 39,000 Calculate appropriate ratios to make comment on the financial performance of the company? *The industry average current ratio is at 1:1 and quick ratio at 0.6:1.
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