EBK FINANCIAL & MANAGERIAL ACCOUNTING
13th Edition
ISBN: 9780100545052
Author: WARREN
Publisher: YUZU
expand_more
expand_more
format_list_bulleted
Question
Chapter 15, Problem 15.7EX
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
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Current Position Analysis
Sherwood, Inc., the parent company of Tasty snack foods and Super beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year(in millions)
Previous Year(in millions)
Cash and cash equivalents
$3,315
$3,531
Short-term investments, at cost
2,355
6,557
Accounts and notes receivable, net
7,485
6,726
Inventories
1,973
1,753
Prepaid expenses and other current assets
658
649
Short-term obligations
351
3,723
Accounts payable
8,419
8,287
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Year
Previous Year
1. Current ratio
fill in the blank 1
fill in the blank 2
2. Quick ratio
fill in the blank 3
fill in the blank 4
b. The liquidity of Sherwood has
some over this time period. Both the current and quick ratios have
. Sherwood is a
company with
resources for meeting short-term…
Current Position Analysis
Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year(in millions)
Previous Year(in millions)
Cash and cash equivalents
$3,599
$3,902
Short-term investments, at cost
2,556
7,247
Accounts and notes receivable, net
8,125
7,433
Inventories
2,142
2,142
Prepaid expenses and other current assets
714
792
Short-term obligations
286
3,032
Accounts payable
6,854
6,748
a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.
Current Position Analysis
Pepsico, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years:
Current Year Previous Year
(in millions)
(in millions)
Cash and cash equivalents
$2,794
$2,659
Short-term investments, at cost
1,985
4,937
Accounts and notes receivable, net
6,309
5,064
Inventories
1,386
924
Prepaid expenses and other current assets
462
342
Short-term obligations
370
3,925
Accounts pavable
8,870
8,735
a. Determine the (1) current ratio and (2) quick ratio for both years. Round answers to one decimal place.
Current Year
Previous Year
1. Current ratio
2. Quick ratio
Chapter 15 Solutions
EBK FINANCIAL & MANAGERIAL ACCOUNTING
Ch. 15 - Prob. 1DQCh. 15 - What is the advantage of using comparative...Ch. 15 - A companys current year net income (after income...Ch. 15 - Prob. 4DQCh. 15 - Prob. 5DQCh. 15 - Prob. 6DQCh. 15 - Prob. 7DQCh. 15 - Prob. 8DQCh. 15 - Prob. 9DQCh. 15 - Prob. 10DQ
Ch. 15 - Prob. 15.1APECh. 15 - Prob. 15.1BPECh. 15 - Prob. 15.2APECh. 15 - Vertical analysis Income statement information for...Ch. 15 - Prob. 15.3APECh. 15 - Prob. 15.3BPECh. 15 - Accounts receivable analysis A company reports the...Ch. 15 - Accounts receivable analysis A company reports the...Ch. 15 - Prob. 15.5APECh. 15 - Inventory analysis A company reports the...Ch. 15 - Prob. 15.6APECh. 15 - Long-term solvency analysis The following...Ch. 15 - Prob. 15.7APECh. 15 - Times interest earned A company reports the...Ch. 15 - Prob. 15.8APECh. 15 - Prob. 15.8BPECh. 15 - Prob. 15.9APECh. 15 - Prob. 15.9BPECh. 15 - Prob. 15.10APECh. 15 - Common stockholders' profitability analysis A...Ch. 15 - Prob. 15.11APECh. 15 - Earnings per share and price-earnings ratio A...Ch. 15 - Prob. 15.1EXCh. 15 - Vertical analysis of income statement The...Ch. 15 - Common-sized income statement Revenue and expense...Ch. 15 - Vertical analysis of balance sheet Balance sheet...Ch. 15 - Prob. 15.5EXCh. 15 - Current position analysis The following data were...Ch. 15 - Prob. 15.7EXCh. 15 - Prob. 15.8EXCh. 15 - Prob. 15.9EXCh. 15 - Prob. 15.10EXCh. 15 - Inventory analysis The following data were...Ch. 15 - Inventory analysis Dell Inc. and Hewlett-Packard...Ch. 15 - Prob. 15.13EXCh. 15 - Prob. 15.14EXCh. 15 - Prob. 15.15EXCh. 15 - Prob. 15.16EXCh. 15 - Profitability ratios The following selected data...Ch. 15 - Profitability ratios Ralph Lauren Corporation...Ch. 15 - Six measures of solvency or profitability The...Ch. 15 - Five measures of solvency or profitability The...Ch. 15 - Prob. 15.21EXCh. 15 - Prob. 15.22EXCh. 15 - Prob. 15.23EXCh. 15 - Prob. 15.24EXCh. 15 - Prob. 15.25EXCh. 15 - Prob. 15.26EXCh. 15 - Horizontal analysis of income statement For 2016,...Ch. 15 - Prob. 15.2APRCh. 15 - Prob. 15.3APRCh. 15 - Nineteen measures of solvency and profitability...Ch. 15 - Solvency and profitability trend analysis Addai...Ch. 15 - Prob. 15.1BPRCh. 15 - Prob. 15.2BPRCh. 15 - Effect of transactions on current position...Ch. 15 - Nineteen measures of solvency and profitability...Ch. 15 - Prob. 15.5BPRCh. 15 - Financial Statement Analysis The financial...Ch. 15 - Prob. 15.1CPCh. 15 - Prob. 15.2CPCh. 15 - Prob. 15.3CPCh. 15 - Prob. 15.4CPCh. 15 - Prob. 15.5CP
Knowledge Booster
Similar questions
- Current Position Analysis Sherwood, Inc., the parent company of Frito-Lay snack foods and Sherwood beverages, had the following current assets and current liabilities at the end of two recent years: Current Year(in millions) Previous Year(in millions) Cash and cash equivalents $2,463 $2,610 Short-term investments, at cost 1,749 4,847 Accounts and notes receivable, net 5,560 4,971 Inventories 1,571 1,396 Prepaid expenses and other current assets 523 516 Short-term obligations 279 2,964 Accounts payable 6,701 6,596 a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place. Current Year Previous Year 1. Current ratio fill in the blank 1 fill in the blank 2 2. Quick ratio fill in the blank 3 fill in the blank 4arrow_forwardCurrent Position Analysis: PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years: Current Year (in millions) Prior Year (in millions) Cash and cash equivalents $5,943 $3,943 Short-term investments, at cost 426 192 Accounts and notes receivable, net 6,323 4624 Inventories 3,372 2,618 Prepaid expenses and other current assets 1,505 1,194 Short-term obligations 4,898 8,292 Accounts payable 10,994 464 a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place. b. What conclusions can draw from these data?arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $446,900 $372,400 Marketable securities 517,400 419,000 Accounts and notes receivable (net) 211,700 139,600 Inventories 1,071,800 807,000 Prepaid expenses 552,200 516,000 Total current assets $2,800,000 $2,254,000 Current liabilities: Accounts and notes payable (short-term) $324,800 $343,000 Accrued liabilities 235,200 147,000 Total current liabilities $560,000 $490,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $fill in the blank 1 $fill in the blank 2 2. Current ratio fill in the blank 3 fill in the blank…arrow_forward
- Current Position Analysis PepsiCo, Inc. (PEP), the parent company of Frito-LayTM snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years: Year 2 (in millions) Year 1 (in millions) $9,158 6,967 Cash and cash equivalents Short-term investments, at cost Accounts and notes receivable, net Inventories Current ratio Quick ratio Year 2 $ 10,610 b. What conclusion can be drawn from these data? 8,900 7,024 2,947 1,546 Prepaid expenses and other current assets Short-term obligations (liabilities) 5,485 6,892 Accounts payable and other current liabilities 15,017 14,243 a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place. Year 1 6,694 2,723 908arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $506,200 $384,000 Marketable securities 586,100 432,000 Accounts and notes receivable (net) 239,700 144,000 Inventories 928,000 702,700 Prepaid expenses 478,000 449,300 Total current assets $2,738,000 $2,112,000 Current liabilities: Accounts and notes payable (short-term) $429,200 $448,000 Accrued liabilities 310,800 192,000 Total current liabilities $740,000 $640,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $fill in the blank 1 $fill in the blank 2 2. Current ratio fill in the blank 3 fill in the blank 4…arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $486,400 $392,000 Marketable securities 563,200 441,000 Accounts and notes receivable (net) 230,400 147,000 Inventories 792,000 469,700 Prepaid expenses 408,000 300,300 Total current assets $2,480,000 $1,750,000 Current liabilities: Accounts and notes payable (short-term) $464,000 $490,000 Accrued liabilities 336,000 210,000 Total current liabilities $800,000 $700,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $fill in the blank 1 $fill in the blank 2 2. Current ratio fill in the blank 3 fill in the blank 4…arrow_forward
- Current Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $329,800 $259,200 Marketable securities 381,900 291,600 Accounts and notes receivable (net) 156,300 97,200 Inventories 900,200 560,000 Prepaid expenses 463,800 358,000 Total current assets $2,232,000 $1,566,000 Current liabilities: Accounts and notes payable (short-term) $359,600 $378,000 Accrued liabilities 260,400 162,000 Total current liabilities $620,000 $540,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $fill in the blank 1 $fill in the blank 2 2. Current ratio fill in the blank 3 fill in the blank 4 3.…arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: $383,000 $308,000 Cash 443,500 346,500 Marketable securities Accounts and notes receivable (net) 181,500 115,500 1,122,700 771,600 Inventories Prepaid expenses 578,300 493,400 $2,709,000 $2,035,000 Total current assets Current liabilities: Accounts and notes payable (short-term) $365,400 $385,000 Accrued liabilities 264,600 165,000 Total current liabilities $630,000 $550,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital 2$ $4 2. Current ratio 3. Quick ratio b. The liquidity of Nilo has from the preceding year to the current year. The working capital, current ratio, and quick ratio have all Most of these changes are the result of an in current assets relative to current…arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $498,200 $384,000 Marketable securities 576,800 432,000 Accounts and notes receivable (net) 236,000 144,000 Inventories 1,047,400 805,200 Prepaid expenses 539,600 514,800 Total current assets $2,898,000 $2,280,000 Current liabilities: Accounts and notes payable (short-term) $400,200 $420,000 Accrued liabilities 289,800 180,000 Total current liabilities $690,000 $600,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $fill in the blank 1 $fill in the blank 2 2. Current ratio fill in the blank 3 fill in the blank 4…arrow_forward
- Current position analysis the following data were taken from the balance sheet of Nilo company at the end of the two recent Fisher years; Current assets: Cash Marketable securities Account and note receivable (net) Inventories Prepaid expenses Total Current assets Current liabilities Account and notes payable ( short-term) Accrued liabilities Total Current liabilities Current year $417,000 cash 483,100 Marketable securities 197,700 acct not receivable ( net) 845,500 inventory 435,500 prepaid 2,379,000 Total Current assets Previous year $339,200 cash 381,600 Marketable securities 127,200 access note receivable ( net) 614,300 inventory 392,700 prepaid expenses 1,855,000 Total Current assets Current year Current liabilities Short term $353,800 Accrued liabilities 256,200 Total Current liabilities $610,000 Previous year Short term $371,000 Accrued liabilities 159,000 Total Current liabilities $530,000 A. Determine for each year 1 capital, 2 the current ratio,…arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $273,600 $201,600 Marketable securities 316,800 226,800 Accounts and notes receivable (net) 129,600 75,600 Inventories 760,300 589,300 Prepaid expenses 391,700 376,700 Total current assets $1,872,000 $1,470,000 Current liabilities: Accounts and notes payable (short-term) $278,400 $294,000 Accrued liabilities 201,600 126,000 Total current liabilities $480,000 $420,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $ $ 2. Current ratio 3. Quick ratio b. The liquidity of Albertini has improved from the preceding year to the current year. The working capital, current ratio, and quick ratio have…arrow_forwardCurrent Position Analysis The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $433,200 $332,800 Marketable securities 501,600 374,400 Accounts and notes receivable (net) 205,200 124,800 Inventories 594,000 380,600 Prepaid expenses 306,000 243,400 Total current assets $2,040,000 $1,456,000 Current liabilities: Accounts and notes payable (short-term) $348,000 $364,000 Accrued liabilities 252,000 156,000 Total current liabilities $600,000 $520,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital $4 2. Current ratio 3. Quick ratioarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education