Financial Accounting, Student Value Edition (5th Edition)
5th Edition
ISBN: 9780134728520
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Textbook Question
Chapter 12, Problem 33AP
Financial statement data of Helgeson Enterprises. Inc., include the following items:
| Cash.......................................................... | $ 24,300 |
| Short-Term investments.......................................................... | 28,100 |
| Accounts Receivable, Net........................................................................ | 90,600 |
| Inventory...................................................«...... | 116,800 |
| Prepaid Expenses..............................................................................-................ | 11, 330 |
| Total Assets......................................................................................................... | 662,700 |
| Short-Term Notes payable................................................................................. | 50,000 |
| Accounts Payable | 78,300 |
| Accrued Liabilities.............................................................................................. | 32,500 |
| Long-Term Notes Payable........................................................................... | 150,000 |
| Other Long Term Liabilities................................................................. | 41,200 |
| Net Income......................................................................................................... | 82,900 |
| Number of Common Shares Outstanding............................................................ | 35,000 |
Requirements
- 1. Compute Helgeton Enterprise current ratio, debt ratio, and earnings per share. Assume that the company has no
preferred stock outstanding. Round all ratios to two decimal places. - 2. Compute the same three ratios after evaluating the effect of each of the following independent transactions
- a. Purchased merchandise of $35,600 on account, debiting Inventory.
- b. Issued 6,000 shares of common stock, receiving cash of $75,000. Use total shares outstanding at year’s end instead of average shares outstanding.
- c. Borrowed $45,000 on a long-term note payable.
- d. Received cash on account, $12,000
Quick solution
1. Current ratio = 1.69, Debt ratio = 53.12percent, EPS = $2.37
2a. Current ratio = 1.56, Debt ratio = 55.51percent, EPS = $2.37
2b. Current ratio = 2.15, Debt ratio = 47.72percent, EPS = $2.02
2c. Current ratio = 1.97, Debt ratio = 56.10percent, EPS = $2.37
2d. Current ratio = 1.69, Debt ratio = 53.12percent, EPS = $2.37
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Chapter 12 Solutions
Financial Accounting, Student Value Edition (5th Edition)
Ch. 12 - Prob. 1DQCh. 12 - Which amount is the base amount for vertical...Ch. 12 - Prob. 3DQCh. 12 - Prob. 4DQCh. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - How would you expect a recession to affect asset...Ch. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 1SCCh. 12 - Prob. 2SCCh. 12 - Prob. 3SCCh. 12 - Prob. 4SCCh. 12 - Prob. 5SCCh. 12 - Prob. 6SCCh. 12 - Prob. 7SCCh. 12 - Prob. 8SCCh. 12 - Prob. 9SCCh. 12 - Prob. 10SCCh. 12 - Prob. 11SCCh. 12 - Prob. 12SCCh. 12 - Prob. 1SECh. 12 - Prob. 2SECh. 12 - Prob. 3SECh. 12 - Prob. 4SECh. 12 - Prob. 5SECh. 12 - Prob. 6SECh. 12 - Prob. 7SECh. 12 - Prob. 8SECh. 12 - Prob. 9SECh. 12 - Prob. 10SECh. 12 - Horizontal analysis(Learning Objective 2)15-20 min...Ch. 12 - Prob. 12AECh. 12 - Horizontal analysis(Learning Objective 2)15-20...Ch. 12 - Prob. 14AECh. 12 - Prob. 15AECh. 12 - Prob. 16AECh. 12 - Prob. 17AECh. 12 - Horizontal analysis(Learning Objective 2)15-20...Ch. 12 - Prob. 26BECh. 12 - Prob. 27BECh. 12 - Prob. 28BECh. 12 - Prob. 29BECh. 12 - Prob. 30BECh. 12 - Trend percentages and return on assets (Learning...Ch. 12 - Common-size financial statements and profitability...Ch. 12 - Current ratio, debt ratio, EPS (Learning Objective...Ch. 12 - Calculating various ratios for analysis (Learning...Ch. 12 - Prob. 35APCh. 12 - Prob. 36APCh. 12 - Trend percentages and return on assets (Learning...Ch. 12 - Common-size financial statements and profitability...Ch. 12 - Prob. 39BPCh. 12 - Calculating various ratios for analysis(Learning...Ch. 12 - Calculating various ratios for analysis (Learning...Ch. 12 - Prob. 42BPCh. 12 - Prob. 1CECh. 12 - Prob. 1CPCh. 12 - Prob. 1EIACh. 12 - Prob. 2EIACh. 12 - Prob. 1FACh. 12 - Industry Analysis Purpose: To help you understand...Ch. 12 - Prob. 1SBACh. 12 - Prob. 1WC
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