MANAGERIAL ACCOUNTING W/CONNECT >IC<
5th Edition
ISBN: 9781259907760
Author: Wild
Publisher: MCG
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Chapter 13, Problem 4PSB
To determine
(1)
Introduction:
Liquidity or short-term ratios determines the ability of a firm to pay its current obligations. A good liquidity ration states that the company has liquid assets which can be easily convertible into cash. It includes
To calculate:
Current ratio.
Expert Solution
Answer to Problem 4PSB
Current ratio is 2.50:1
Explanation of Solution
= $43,600
= $17,400
= 2.50:1
To determine
(2)
Introduction:
Liquidity or short-term ratios determines the ability of a firm to pay its current obligations. A good liquidity ration states that the company has liquid assets which can be easily convertible into cash. It includes current ratio, quick ratio etc.
To calculate:
Acid-test ratio.
Expert Solution
Answer to Problem 4PSB
Acid-test ratio is 1.72:1
Explanation of Solution
= 1.72:1
To determine
(3)
Introduction:
Days sales uncollected ratio helps the creditors and investors to measure the time in which company collects its account receivable.
To calculate:
Days sales uncollected.
Expert Solution
Answer to Problem 4PSB
Days sales uncollected = 18 days
Explanation of Solution
= 18 days
To determine
(4)
Introduction:
Inventory turnover ratio measures how many times inventory is sold during a period.
To calculate:
Inventory turnover ratio.
Expert Solution
Answer to Problem 4PSB
Inventory-turnover ratio is 15.2 times.
Explanation of Solution
= $15,450
= 15.2 times
To determine
(5)
Introduction:
Days sales in inventory calculates the time period which company takes to convert its inventory into sales.
To calculate:
Days sales in inventory.
Expert Solution
Answer to Problem 4PSB
Days sales in inventory = 24 days
Explanation of Solution
= 24 days.
To determine
(6)
Introduction:
Debt-equity ratio measures the proportion of debt and equity in the capital structure.
To calculate:
Debt to equity ratio.
Expert Solution
Answer to Problem 4PSB
Debt to equity ratio is 1.4:1
Explanation of Solution
= $47,400:
= $70,100
= 1.4:1
To determine
(7)
Introduction:
Time interest earned ratio measures the amount of income that will be required for covering the interest expenses in the future.
To calculate:
Time interest earned.
Expert Solution
Answer to Problem 4PSB
Time interest earned= 6.6
Explanation of Solution
= 6.6
To determine
(8)
Introduction:
Profit margin ratio is calculated by dividing net income by the net sales.
To calculate:
Profit margin ratio.
Expert Solution
Answer to Problem 4PSB
Profit margin ratio is 7.5%
Explanation of Solution
= 7.5%
To determine
(9)
Introduction:
Asset turnover ratio calculates the ability of a company to generate sales with the total assets.
To calculate:
Asset-turnover ratio.
Expert Solution
Answer to Problem 4PSB
Asset-turnover ratio = 2.6
Explanation of Solution
= 2.6:
To determine
(10)
Introduction:
Return on total asset is a ratio that calculated by dividing earnings before income tax by total assets.
To calculate:
Return on total asset.
Expert Solution
Answer to Problem 4PSB
Return on total asset is $0.20
Explanation of Solution
= $0.20
= $23,800
To determine
(11)
Introduction:
Return on common
To calculate:
Return on common stockholder’s equity.
Expert Solution
Answer to Problem 4PSB
Return on common stockholder’s equity is $0.33
Explanation of Solution
= $0.33:
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Students have asked these similar questions
The following figures and ratios are related to a company:
Credit sales for the year- ₹ 30,00,000
Gross Profit ratio- 25%
Fixed Assets turnover (based on cost of goods sold)- 1.5
Stock turnover (based on cost of goods sold)- 6
Quick Ratio- 1:1
Current ratio- 1.5:1
Debtors collection period- 2 months
Reserve and surplus to share capital- 0.6:1
Capital Gearing ratio- 0.5
Fixed assets to net worth- 1.20 :1
You are required to prepare balance sheet of the company on the basis of above details.
Oman Oasis Company provided the following information for the year ended
31st December 2017.
Inventory- RO 56,000 Long term debt – RO 74,500 Good will – RO 25,000
Account receivables – RO 38,400 Account payable – RO 47,800 Machinery – RO 67,000
Deferred income taxes – RO 14,500 Fixtures and fittings – RO 26,000 Cash – RO 12,500
Shareholder’s equity – RO 90,000 Short term debt – RO 5,600 Other current assets – RO 7,500
Analyze the above information and prepare the Balance sheet of Oman Oasis Company for the year ended 31st December 2017
Using the information below, fill in the gaps in the financial statement date for the Stapler Corporation:
Total assets turnover: 1.5Days sales outstanding: 36.5 days* * Calculation is based on a 365-day year.
Inventory turnover ratio: 5
Fixed asset turnover = 3.0
Current ratio: 2.0Gross profit margin: = Gross profit / Sales = (Sales – COGS) / Sales = 25%
Cash ____________ Accounts payable ____________
Accounts receivable ____________ Long-term debt $60,000
Inventory ____________ Common stock ____________
Fixed assets ____________ Retained earnings $97,500
Total Assets $300,000 Total L&E ____________
Sales…
Chapter 13 Solutions
MANAGERIAL ACCOUNTING W/CONNECT >IC<
Ch. 13 - Prob. 1MCQCh. 13 - Prob. 2MCQCh. 13 - Prob. 3MCQCh. 13 - Prob. 4MCQCh. 13 - Prob. 5MCQCh. 13 - Prob. 1DQCh. 13 - Prob. 2DQCh. 13 - Prob. 3DQCh. 13 - Prob. 4DQCh. 13 - Prob. 5DQ
Ch. 13 - Prob. 6DQCh. 13 - Prob. 7DQCh. 13 - Prob. 8DQCh. 13 - Prob. 9DQCh. 13 - Prob. 10DQCh. 13 - Prob. 11DQCh. 13 - Prob. 12DQCh. 13 - Where on the income statement does a company...Ch. 13 - Prob. 14DQCh. 13 - Prob. 15DQCh. 13 - Prob. 16DQCh. 13 - Use Samsungs financial statements in Appendix A to...Ch. 13 - Prob. 1QSCh. 13 - Prob. 2QSCh. 13 - Prob. 3QSCh. 13 - Prob. 4QSCh. 13 - Prob. 5QSCh. 13 - Prob. 6QSCh. 13 - Prob. 7QSCh. 13 - Prob. 8QSCh. 13 - Prob. 9QSCh. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Prob. 5ECh. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Prob. 8ECh. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Prob. 11ECh. 13 - Prob. 12ECh. 13 - Prob. 13ECh. 13 - Prob. 14ECh. 13 - Prob. 15ECh. 13 - Prob. 1PSACh. 13 - Prob. 2PSACh. 13 - Prob. 3PSACh. 13 - Selected year-end and financial statement of...Ch. 13 - Prob. 5PSACh. 13 - Prob. 6PSACh. 13 - Prob. 1PSBCh. 13 - Prob. 2PSBCh. 13 - Kato Corporation began the month of June with...Ch. 13 - Prob. 4PSBCh. 13 - Prob. 5PSBCh. 13 - Prob. 6PSBCh. 13 - This serial Problem began in Chapter 1 and...Ch. 13 - Refer to Apples financial statements in appendix A...Ch. 13 - Prob. 2BTNCh. 13 - Prob. 3BTNCh. 13 - Prob. 4BTNCh. 13 - Prob. 5BTNCh. 13 - Prob. 6BTNCh. 13 - Prob. 7BTNCh. 13 - Prob. 8BTNCh. 13 - Prob. 9BTN
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