1.
Introduction:
Accounting ratios: The accounting ratios are calculated by the company to measure the profitability, liquidity, solvency, and efficiency of the company. The accounting ratios are calculated based on the
To calculate: The (a) acid-test ratio (b) accounts receivable turnover (c) day’s sales in receivable ratio.
2.
Introduction:
Accounting ratios: The accounting ratios are calculated by the company to measure the profitability, liquidity, solvency, and efficiency of the company. The accounting ratios are calculated based on the balance sheet and income statement.
The ratios that have been improved or deteriorated from 2023 to 2024. Also, state the trend for the company.
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Chapter 8 Solutions
HORNGREN'S FINANCIAL & MANGERIAL ACCOUNT
- Review the select information for Liquor Plaza and Beer Buddies (industry competitors) and complete the following. A. Compute the accounts receivable turnover ratios for each company for 2018 and 2019. B. Compute the number of days sales in receivables ratios for each company for 2018 and 2019. C. Determine which company is the better investment and why. Round answers to two decimal places.arrow_forwardUsing the following select financial statement information from Mover Supply Depot, compute the accounts receivable turnover ratios for 2018 and 2019 (round answers to two decimal places). What do the outcomes tell a potential investor about Mover Supply Depot if the industry average is 4 times?arrow_forwardUsing the following select financial statement information from Black Water Industries, compute the accounts receivable turnover ratios for 2018 and 2019 (round answers to two decimal places). What do the outcomes tell a potential investor about Black Water Industries?arrow_forward
- Juroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Required: 1. Calculate the return on sales. (Note: Round the percent to two decimal places.) 2. CONCEPTUAL CONNECTION Briefly explain the meaning of the return on sales ratio, and comment on whether Juroes return on sales ratio appears appropriate.arrow_forwardRatio Analysis The following information was taken from Nash Inc.s trial balances as of December 31, 2018, and December 31, 2019. Required: 1. Calculate the net profit margin and accounts receivable turnover for 2019. ( Note: Round answers to two decimal places.) 2. How much does Nash make on each sales dollar? 3. How many days does the average receivable take to be paid (assuming all sales are on account)?arrow_forwardUse this data to compute the following ratios: 1.Current ratio (Dec 2020 )2.Acid-test Ratio (Dec 2020) 3.Accounts Receivable Turnover 4.Inventory Turnover 5.Return on Assets 6.Profit Margin on Sales 7.Return on Equity 8.Times Interest Earned b.Discuss the financial condition of ABC Company, Inc. based on what you learn from computing the ratios.arrow_forward
- 1. Compute the following ratios for the comparative periods (2018 and 2019). The company used 365 days in its computation for some of the ratios. Show your solution. a. Working Capital b. Current Ratio c. Acid Test Ratio d. Accounts Receivable Turnover Ratio e. Average Collection Period f. Inventory Turnover Ratio g. Average Days in Inventory h. Number of days in Operating Cycle i. Debt to Total Assets Ratio j. Debt to Equity Ratio k. Times Interest Earned Ratio l. Gross Profit Ratio m. Profit Margin Ratio n. Return on Assets o. Return on Equity p. Assets Turnover Ratioarrow_forwardFINANCIAL RATIO: Requirement: Compute for the following financial ratios for the year 2021 (round-off answers to two decimal places) f. Accounts receivable turnover (assume all sales are on credit) g. Days of receivable (use 365 days) h. Debt ratio i. Equity ratio j. Debt-to-equity ratio k. Gross profit ratio 1. Net profit ratio m. Return on assets n. Return on equityarrow_forwardThe condensed financial statements of Ivanhoe Company for the years 2020-2021 are presented below: (See Images) Compute the following financial ratios by placing the proper amounts for numerators and denominators. (Round per unit answers to 2 decimal places, e.g. 52.75.) (a) Current ratio at 12/31/21 $ $ (b) Acid test ratio at 12/31/21 $ $ (c) Accounts receivable turnover in 2021 $ $ (d) Inventory turnover in 2021 $ $ (e) Profit margin on sales in 2021 $ $ (f) Earnings per share in 2021 $ (g) Return on common stockholders’ equity in 2021 $ $ (h) Price earnings ratio at 12/31/21 $ $ (i) Debt to assets at 12/31/21 $ $ (j) Book value per share at 12/31/21 $arrow_forward
- 10. Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following. A. Compute the accounts receivable turnover ratios for each company for 2018 and 2019. B Compute the number of days sales in receivables ratios for each company for 2018 and 2019 C. Determine which company is the better investment and why. Round answers to two decimal places.arrow_forwardUsing the financial statements provided below for ABC Manufacturing Company, calculate all the ratios listed below for both 2020 and2021. Assume that all sales are credit sales. (a) Calculate the ratios forABC Manufacturing Company for2020 and 2021. (b)Put an“I/D” beside the Year 2021 ratio calculation if the ratio has Improved/Deteriorated. Putan“S”/“W” beside the Year 2021 ratio if ABC Manufacturing Company’s ratio is Stronger/Weake rthan its competitorsarrow_forwardConsider the comparative balance sheet and income statement for Starbucks provided in the shown Figures . Based on these financial statements, determine the following for the year September 30, 2018: Solve,d. Acid test ratio. e. Accounts receivable turnover. f. Inventory turnover.arrow_forward
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegeCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningManagerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
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