Financial and Managerial Accounting - With CengageNow
14th Edition
ISBN: 9781337577809
Author: WARREN
Publisher: CENGAGE L
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Question
Chapter 14, Problem 14.7EX
A. (1)
To determine
Financial Ratios: Financial ratios are the metrics used to evaluate the capabilities, profitability, and overall performance of a company.
To compute:
Given info: Items of current asset and current liabilities
A. (2)
To determine
To compute: Acid-test ratio for current year and previous year.
Given info: Items of current asset and current liabilities
B.
To determine
To provide: Conclusion towards company’s ratios
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Quick Ratio
Gmeiner Co. had the following current assets and liabilities on December 31 of two recent years:
Current Year
Previous Year
Current assets:
Cash
$487,000
$763,000
Accounts receivable
431,000
359,000
Inventory
266,000
303,000
Total current assets
$1,184,000
$1,425,000
Current liabilities:
Current portion of long-term debt
$86,000
$77,000
Accounts payable
173,000
153,000
Accrued and other current liabilities
281,000
280,000
Total current liabilities
$540,000
$510,000
a. Determine the quick ratio for December 31 of both years. If required, round your answers to one decimal place.
Quick Ratio
Previous year:
Current year:
b. How did the quick ratio change between the two balance sheet dates?
Working Capital and Short Term Liquidity Ratios
Bell Company has a current ratio of 2.85 on December 31. On that date the company's current assets are as follows:
Cash
Short-term investments
Accounts receivable (net)
Inventory
Prepaid expenses
Current assets
$31,400
52,000
169,000
220,000
11,600
$484,000
Bell Company's current liabilities at the beginning of the year were $135,000 and during the year its operating activities provided a cash flow of $50,000.
a. What are the firm's current liabilities on December 31?
Round answer to the nearest whole number.
0
b. What is the firm's working capital on December 31?
Round answer to the nearest whole number.
0
c. What is the quick ratio on December 31?
Round answer to 2 decimal places.
0
d. What is the Bell's operating-cash-flow-to-current-liabilities ratio?
Round answer to 2 decimal places.
Quick Ratio
Gmeiner Co. had the following current assets and liabilities on December 31 of two recent years:
Current Year
Previous Year
Current assets:
Cash
$ 486,000
$ 500,000
Accounts receivable
210,000
200,000
Inventory
375,000
350,000
Total current assets
$1,071,000
$1,050,000
Current liabilities:
Current portion of long-term debt
$ 145,000
$ 110,000
Accounts payable
175,000
150,000
Accrued and other current liabilities
260,000
240,000
Total current liabilities
$ 580,000
$ 500,000
a. Determine the quick ratio for December 31 of both years. If required, round your answers to one decimal place.
Quick Ratio
Previous year:
fill in the blank 1
Current year:
fill in the blank 2
b. How did the quick ratio change between the two balance sheet dates?
Which statement below describes the change between the two balance sheet dates?
Chapter 14 Solutions
Financial and Managerial Accounting - With CengageNow
Ch. 14 - Prob. 1DQCh. 14 - What is the advantage of using comparative...Ch. 14 - A companys current year net income (after income...Ch. 14 - Prob. 4DQCh. 14 - Prob. 5DQCh. 14 - Prob. 6DQCh. 14 - Prob. 7DQCh. 14 - Prob. 8DQCh. 14 - Prob. 9DQCh. 14 - Prob. 10DQ
Ch. 14 - Prob. 14.1BECh. 14 - Vertical analysis Income statement information for...Ch. 14 - Prob. 14.3BECh. 14 - Accounts receivable analysis A company reports the...Ch. 14 - Inventory analysis A company reports the...Ch. 14 - Long-term solvency analysis The following...Ch. 14 - Times interest earned A company reports the...Ch. 14 - Asset turnover A company reports the following:...Ch. 14 - Prob. 14.9BECh. 14 - Common stockholders' profitability analysis A...Ch. 14 - Earnings per share and price-earnings ratio A...Ch. 14 - Vertical analysis of income statement Revenue and...Ch. 14 - Vertical analysis of income statement The...Ch. 14 - Common-sized income statement Revenue and expense...Ch. 14 - Vertical analysis of balance sheet Balance shed...Ch. 14 - Horizontal analysis of the income statement Income...Ch. 14 - Current position analysis The following data were...Ch. 14 - Prob. 14.7EXCh. 14 - Prob. 14.8EXCh. 14 - Prob. 14.9EXCh. 14 - Prob. 14.10EXCh. 14 - Inventory analysis The following data were...Ch. 14 - Prob. 14.12EXCh. 14 - Ratio of liabilities to stockholders' equity and...Ch. 14 - Prob. 14.14EXCh. 14 - Prob. 14.15EXCh. 14 - Prob. 14.16EXCh. 14 - Profitability ratios The following selected data...Ch. 14 - Profitability ratios Ralph Lauren Corporation...Ch. 14 - Six measures of solvency or profitability The...Ch. 14 - Five measures of solvency or profitability The...Ch. 14 - Prob. 14.21EXCh. 14 - Prob. 14.22EXCh. 14 - Prob. 14.23EXCh. 14 - Prob. 14.24EXCh. 14 - Prob. 14.25EXCh. 14 - Comprehensive Income Anson Industries, Inc....Ch. 14 - Horizontal analysis of income statement For 20V2,...Ch. 14 - Prob. 14.2APRCh. 14 - Prob. 14.3APRCh. 14 - Measures of liquidity, solvency, and profitability...Ch. 14 - Prob. 14.5APRCh. 14 - Horizontal analysis of income statement For 20Y2,...Ch. 14 - Prob. 14.2BPRCh. 14 - Effect of transactions on current position...Ch. 14 - Measures of liquidity, solvency and profitability...Ch. 14 - Prob. 14.5BPRCh. 14 - Financial Statement Analysis The financial...Ch. 14 - Continuing Company AnalysisAmazon, Best Buy, and...Ch. 14 - Prob. 2ADMCh. 14 - Prob. 3ADMCh. 14 - Prob. 14.1TIFCh. 14 - Prob. 14.3TIF
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