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Concept explainers
1.
Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.
To calculate: The missing amount in income statement.
2.
Times-Interest-Earned ratio: It is the ratio that quantify a business ability to pay interest expense. It is calculated as shown below:
To calculate: Times-interest-earned ratio for Company V for 2016.
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Chapter 11 Solutions
Horngren's Financial & Managerial Accounting Plus Mylab Accounting With Pearson Etext -- Access Card Package (5th Edition) (miller-nobles Et Al., The Horngren Accounting Series)
- Computing times-interest-earned ratio The income statement for California Communications follows. Assume California Communications signed a 3-month, 9%, $3,000 note on June 1, 2018, and that this was the only note payable for the company. Requirements Fill in the missing information for California’s year ended July 31, 2018, income statement. Round to the nearest dollar. Compute the times-interest-earned ratio for the company. Round to two decimals.arrow_forwardBarga Co. reported net sales for 2016 and 2017 of $665,000 and $742,000, respectively. Its year-end balances of accounts receivable follow: December 31, 2016, $63,000; and December 31, 2017, $89,000. a. Complete the below table to calculate the days' sales uncollected at the end of each year. (Round your "Days' Sales Uncollected" answer to 1 decimal place.) ok Days' Sales Uncollected Choose Numerator: Choose Denominator: Days Days' Sales Uncollected %3D Days' sales uncollected 2016: days %3D 2017: days %3D ces < Prev 4 of 4 Nextarrow_forwardBold Company’s 2016 income statement reported total credit revenue of $250,000. Bold’s accounts receivable balance on January 1, 2016 was $30,000, and its December 31, 2016 accounts receivable balance was $10,000. Bold’s accounts payable balance on January 1, 2016 was $25,000, and its December 31, 2016 accounts payable balance was $35,000. How much did Bold collect from customers during 2016?arrow_forward
- At the end of the annual reporting period, the accounts of Berry Company showed the following information: a. Sales Revenue for 2015, P180,000 of which one sixth was on credit. b. Allowance for doubtful accounts, balance January 1, 2015, P900 credit. c. Accounts receivable, balance December 31, 2015 ( prior to the write-off of uncollectible accounts during 2015), P18,050. d. Uncollectible accounts to be written off, December 31, 2015, P1,050. e. Aging schedule at December 31, 2015, showing the following breakdown of total accounts receivable: Status Amount % Uncollectible Not past due P10,000 .5% Past due 1-60 days 4,000 1% Past due over 60 days 3,000 8% Question: 1. During 2015, how much of the accounts receivable was collected? a. P12,500 b. P11,950 c. P10,950 d. P11,000 2. On total receivables at year-end, using the aging of accounts receivable, what is the entry to record bad debts expense ? a. Debit Bad debts expense 330; credit Allowance for bad debts 330…arrow_forwardReformulating Financial Statements For Warranty Expense Income statement data for Whirlpool Industries from the company's 2016 financial statements follow. Use these data to reformulate the income statement for 2014, 2015, and 2016 under the assumption that warranty expense is a constant percentage of revenue across all three years. Specifically, compute the adjustments to: warranty expense, income tax expense, and net income. The company's tax rate is 30%. 12 Months Ended ($ millions) Dec. 31, 2016 Dec. 31, 2015 Dec. 31, 2014 Net sales $26,396 $26,569 $25,550 Warranty expense 571 815 577 Compute the average warranty expense to net sales rate over the past three years. Round answer to two decimal places (ex: 0.02345 = 2.35%) 2.5 % Using your rounded answer, compute the adjusted warranty expense for each year. • Round answers to one decimal place. • Use a negative sign to indicate if the adjustment decreases an account balance. Income Statements Adjustments Adjusted warranty expense…arrow_forwardUse the following financial statement information from Black Water Industries. BLACK WATER INDUSTRIES Ending Accounts Receivable Year Net Credit Sales 2017 $690,430 $335,250 2018 705,290 364,450 2019 770,500 406,650 A. Compute the accounts receivable turnover ratios for 2018 and 2019. Round your answers to two decimal places. 2018 times 2019 times B. Using the accounts receivable turnover, choose the statement that most closely describes the company's management of its receivables. a. The company's lending policies may be too strict. b. Collection efforts are not aggressive enough. There may be uncollectable receivables affecting the beginning and ending C. balances. d. All of the above statements may be correct. a b darrow_forward
- (Pro forma accounts receivable balance calculation) The accounts receivable for Pastors Brewing Company on March 31, 2016 was $24,100. Firm sales are roughly evenly split between credit and cash sales, with 40 percent of the credit sales collected in the month after the sale and the remainder 2 months after the sale. Historical and projected sales for the brewing company are given here: a. Under these circumstances, what should the balance in accounts receivable be at the end of April? b. How much cash did Pastors' realize during April from sales and collections? a. Under these circumstances, what should the balance in accounts receivable be at the end of April? (Round to the nearest dollar.) $ Data table SALES $32,000 $38,000 April (projected) (Click on the icon located on the top-right corner of the data table above in order to copy its contents into a spreadsheet.) MONTH January February SALES $22,000 $27,000 MONTH March Xarrow_forwardMotorvehicles of Houston, Inc., reported the following financial statements for 2018: Requirement Reference Reference Calculate the following, enter all amounts in thousands. New borrowing or payment of long-term notes payable. Motorvehicles of Houston had only one long-term note payable transaction during the year. Motorvehicles of Houston, Inc. a. Motorvehicles of Houston, Inc. Comparative Balance Sheets Income Statement December 31, 2018 and 2017 Issuance of common stock or retirement of common stock. Motorvehicles of Houston had only one common stock transaction during the b. Year Ended December 31, 2018 (In thousands) year. Assets 2018 2017 Liabilities 2018 2017 (In thousands) Payment of cash dividends (same as dividends declared). 740 C. Current: Current Service revenue Cash 27 $ 13 Accounts payable 48 $ 43 Cost of goods sold 300 Print Done Accounts receivable 51 47 Salary payable 31 27 Salary expense 60 Inventory 73 89 Accrued liabilities 11 14 Depreciation expense 90 120…arrow_forwardCornProducts Corporation ended the year 2018 with an average collection period of 40 days. The firm's credit sales for 2018 were $9 million. What is the approximate year-end 2018 balance in accounts receivable for Corn Products?arrow_forward
- Millennial Manufacturing has net credit sales for 2018 in the amount of $1,433,630, beginning accounts receivable balance of $585,900, and an ending accounts receivable balance of $621,450. Compute the accounts receivable turnover ratio and the number of days sales in receivables ratio for 2018 (round answers to two decimal places). What do the outcomes tell a potential investor about Millennial Manufacturing if industry average is 2.6 times and number of days sales ratio is 180 days?arrow_forwardBerry Farms has an accounts receivable balance at the end of 2018 of $425,650. The net credit sales for the year are $924,123. The balance at the end of 2017 was $378,550. What is the number of days sales in receivables ratio for 2018 (round all answers to two decimal places)?arrow_forwardUsing the following select financial statement information from Mover Supply Depot, compute the accounts receivable turnover ratios for 2018 and 2019 (round answers to two decimal places). What do the outcomes tell a potential investor about Mover Supply Depot if the industry average is 4 times?arrow_forward
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