1.
Concept Introduction:
To Prepare: Classified balance sheet.
2.
Concept Introduction:Balance sheet is the statement which makes a record of all assets and liabilities on a particular date. Balance sheet shows value of assets and liabilities on closing date of year.
To Calculate: Current Ratio.
3.
Concept Introduction:Balance sheet is the statement which makes a record of all assets and liabilities on a particular date. Balance sheet shows value of assets and liabilities on closing date of year. Current ratio is calculated by dividing the current assets by the current liabilities. It is Helps Company to measure the liquidity.
To State: Whether Company is liquid or not and other factors to determine liquidity.
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Financial Accounting: The Impact on Decision Makers
- Income Statement, Statement of Retained Earnings, and Balance Sheet The following list, in alphabetical order, shows the various items that regularly appear on the financial statements of Sterns Audio Book Rental Corp. The amounts shown for balance sheet items are balances as of December 31, 2016 (with the exception of retained earnings, which is the balance on January 1, 2016), and the amounts shown for income statement items are balances for the year ended December 31, 2016. Required Prepare an income statement for the year ended December 31, 2016. Prepare a statement of retained earnings for the year ended December 31, 2016. Prepare a balance sheet at December 31, 2016. You have $1,000 to invest. On the basis of the statements you prepared, would you use it to buy stock in this company? Explain. What other information would you want before deciding?arrow_forwardA Preparation of Ratios Refer to the financial statements for Burch Industries in Problem 12-89A and the following data. Required: 1. Prepare all the financial ratios for Burch for 2019 and 2018 (using percentage terms where appropriate and rounding all answers to two decimal places). 2. CONCEPTUAL CONNECTION Explain whether Burchs short-term liquidity is adequate. 3. CONCEPTUAL CONNECTION Discuss whether Burch uses its assets efficiently. 4. CONCEPTUAL CONNECTION Determine whether Burch is profitable. 5. CONCEPTUAL CONNECTION Discuss whether long-term creditors should regard Burch as a high-risk or a low-risk firm. 6. Perform a Dupont analysis (rounding to two decimal places) for 2018 and 2019.arrow_forwardAnalyzing Starbuckss Balance Sheet Disclosures Review the financial statements and related notes of Starbucks in Appendix A. Required: Answer the following questions pertaining to Starbuckss balance sheet as of October 1, 2017, and related information. (Note: You do not need to make any calculations. All answers may be found in the financial report.) 1. What was the amount of the current assets and current liabilities? 2. What was the single largest current asset and current liability? 3. What was the amount in the allowance for doubtful accounts? 4. What is the par value of the companys common stock? How many shares were issued and outstanding? 5. What was the total amount of inventory? What were the principal categories of inventory? 6. What costing method was used for inventories? 7. What was the total property, plant, and equipment before and after accumulated depreciation? 8. What was the accumulated depreciation? What method does the company use to depreciate its property, plant, and equipment? 9. What was the long-term debt? When is the debt due? 10. What was the retained earnings balance? What caused retained earnings to change in 2017? 11. What was the accumulated other comprehensive income/(loss) balance? 12. What was the noncontrolling interest balance?arrow_forward
- Financial statement analysis The financial statements for Nike, Inc., are presented in Appendix D at the end of the text. Use the following additional information (in thousands): Instructions 1. Determine the following measures for the fiscal years ended May 31, 2016, and May 31, 2015. Round ratios and percentages to one decimal place. a. Working capital b. Current ratio c. Quick ratio d. Accounts receivable turnover e. Number of days sales in receivables f. Inventory turnover g. Number of days sales in inventory h. Ratio of liabilities to stockholders equity i. Asset turnover j. Return on total assets. k. Return on common stockholders equity l. Price-earnings ratio, assuming that the market price was 54.90 per share on May 29, 2016, and 52.81 per share on May 30, 2015 m. Percentage relationship of net income to sales 2. What conclusions can be drawn from these analyses?arrow_forwardBelow is the balance sheet and income statement for Chin Corporation. You are needed to analyze the financial statements. Use the horizontal, vertical, ratio methods to analyze the financial statements. For the vertical and horizontal analysis, type the accounts and dollar values for the years 2018 and 2017 (as listed on the financial statements even if there is no dollar value for an account). For the ratio analysis, make sure to compute 2 ratios from each section. Income Statement Period Ending: 12/31/2018 12/31/2017 Total Revenue $76,512,000 $78,291,000 Cost of Revenue $54,884,000 $56,586,000 Gross Profit $21,628,000 $21,706,000 Operating Expenses Research and Development $0 $0 Sales, General, and Admin. $13,886,000 $13,599,000 Non-Recurring Items $0 $0 Other Operating Items $0 $0 Operating Income $7,832,000 $8,079,000 Add'l income/expense items -$323,000…arrow_forwardPlease see below. All info is included. During 2017, Ivanhoe Company entered into the following transactions. 1. Purchased equipment for $317,240 cash. 2. Issued common stock to investors for $135,850 cash. 3. Purchased inventory of $65,970 on account. Using the following tabular analysis, show the effect of each transaction on the accounting equation. For Retained Earnings, use separate columns for Revenues, Expenses, and Dividends if necessary. (If a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced. See Illustration 3-3 for example.) Assets = Liabilities + Stockholders’ Equity Cash + Inventory + Equipment = Accounts Payable + Common Stock + Retained Earnings (1) $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount…arrow_forward
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