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Calculate the Average day's collection ratio. (Use 360 days a year. Do not round intermediate calculatic the nearest hundredth.) 2020 2019 Average day's collection ratio Days

Calculate the Average day's collection ratio. (Use 360 days a year. Do not round intermediate calculatic the nearest hundredth.) 2020 2019 Average day's collection ratio Days

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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### Financial Statement Analysis #### Assets - **Accounts Receivable** - 2020: $16,500 - 2019: $12,500 - **Merchandise Inventory** - 2020: $8,500 - 2019: $14,000 - **Prepaid Expenses** - 2020: $24,000 - 2019: $10,000 - **Total Current Assets** - 2020: $61,000 - 2019: $45,500 - **Plant and Equipment:** - **Building (net)** - 2020: $14,500 - 2019: $11,000 - **Land** - 2020: $13,500 - 2019: $9,000 - **Total Plant and Equipment** - 2020: $28,000 - 2019: $20,000 - **Total Assets** - 2020: $89,000 - 2019: $65,500 #### Liabilities - **Current Liabilities:** - **Accounts Payable** - 2020: $13,000 - 2019: $7,000 - **Salaries Payable** - 2020: $7,000 - 2019: $5,000 - **Total Current Liabilities** - 2020: $20,000 - 2019: $12,000 - **Long-term Liabilities:** - **Mortgage Note Payable** - 2020: $22,000 - 2019: $20,500 - **Total Liabilities** - 2020: $42,000 - 2019: $32,500 #### Stockholders’ Equity - **Common Stock** - 2020: $21,000 - 2019: $21,000 - **Retained Earnings** - 2020: $26,000 - 2019: $12,000 - **Total Stockholders’ Equity** - 2020: $47,000 - 2019: $33,000 - **
Transcribed Image Text:### Financial Statement Analysis #### Assets - **Accounts Receivable** - 2020: $16,500 - 2019: $12,500 - **Merchandise Inventory** - 2020: $8,500 - 2019: $14,000 - **Prepaid Expenses** - 2020: $24,000 - 2019: $10,000 - **Total Current Assets** - 2020: $61,000 - 2019: $45,500 - **Plant and Equipment:** - **Building (net)** - 2020: $14,500 - 2019: $11,000 - **Land** - 2020: $13,500 - 2019: $9,000 - **Total Plant and Equipment** - 2020: $28,000 - 2019: $20,000 - **Total Assets** - 2020: $89,000 - 2019: $65,500 #### Liabilities - **Current Liabilities:** - **Accounts Payable** - 2020: $13,000 - 2019: $7,000 - **Salaries Payable** - 2020: $7,000 - 2019: $5,000 - **Total Current Liabilities** - 2020: $20,000 - 2019: $12,000 - **Long-term Liabilities:** - **Mortgage Note Payable** - 2020: $22,000 - 2019: $20,500 - **Total Liabilities** - 2020: $42,000 - 2019: $32,500 #### Stockholders’ Equity - **Common Stock** - 2020: $21,000 - 2019: $21,000 - **Retained Earnings** - 2020: $26,000 - 2019: $12,000 - **Total Stockholders’ Equity** - 2020: $47,000 - 2019: $33,000 - **
### Logic Company Financial Overview **Comparative Income Statement** _For Years Ended December 31, 2019 and 2020_ - **2020** - **Gross Sales:** $19,000 - **Sales Returns and Allowances:** $1,000 - **Net Sales:** $18,000 - **Cost of Merchandise (Goods) Sold:** $12,000 - **Gross Profit:** $6,000 - **Operating Expenses:** - Depreciation: $700 - Selling and Administrative: $2,200 - Research: $550 - Miscellaneous: $360 - **Total Operating Expenses:** $3,810 - **Income Before Interest and Taxes:** $2,190 - **Interest Expense:** $560 - **Income Before Taxes:** $1,630 - **Provision for Taxes:** $640 - **Net Income:** $990 - **2019** - **Gross Sales:** $15,000 - **Sales Returns and Allowances:** $100 - **Net Sales:** $14,900 - **Cost of Merchandise (Goods) Sold:** $9,000 - **Gross Profit:** $5,900 - **Operating Expenses:** - Depreciation: $600 - Selling and Administrative: $2,000 - Research: $500 - Miscellaneous: $300 - **Total Operating Expenses:** $3,400 - **Income Before Interest and Taxes:** $2,500 - **Interest Expense:** $500 - **Income Before Taxes:** $2,000 - **Provision for Taxes:** $800 - **Net Income:** $1,200 **Comparative Balance Sheet** _As of December 31, 2019 and 2020_ - **Assets:** - **2020** - Cash: $12,000 - Accounts Receivable: $16,500 - Merchandise Inventory: $8,500 - Prepaid Expenses: $24,000 - Total Current Assets: $61,000 - Plant and Equipment: - Building (Net): $14,500 - Land: $13,500 - Total Plant and Equipment: $28,000
Transcribed Image Text:### Logic Company Financial Overview **Comparative Income Statement** _For Years Ended December 31, 2019 and 2020_ - **2020** - **Gross Sales:** $19,000 - **Sales Returns and Allowances:** $1,000 - **Net Sales:** $18,000 - **Cost of Merchandise (Goods) Sold:** $12,000 - **Gross Profit:** $6,000 - **Operating Expenses:** - Depreciation: $700 - Selling and Administrative: $2,200 - Research: $550 - Miscellaneous: $360 - **Total Operating Expenses:** $3,810 - **Income Before Interest and Taxes:** $2,190 - **Interest Expense:** $560 - **Income Before Taxes:** $1,630 - **Provision for Taxes:** $640 - **Net Income:** $990 - **2019** - **Gross Sales:** $15,000 - **Sales Returns and Allowances:** $100 - **Net Sales:** $14,900 - **Cost of Merchandise (Goods) Sold:** $9,000 - **Gross Profit:** $5,900 - **Operating Expenses:** - Depreciation: $600 - Selling and Administrative: $2,000 - Research: $500 - Miscellaneous: $300 - **Total Operating Expenses:** $3,400 - **Income Before Interest and Taxes:** $2,500 - **Interest Expense:** $500 - **Income Before Taxes:** $2,000 - **Provision for Taxes:** $800 - **Net Income:** $1,200 **Comparative Balance Sheet** _As of December 31, 2019 and 2020_ - **Assets:** - **2020** - Cash: $12,000 - Accounts Receivable: $16,500 - Merchandise Inventory: $8,500 - Prepaid Expenses: $24,000 - Total Current Assets: $61,000 - Plant and Equipment: - Building (Net): $14,500 - Land: $13,500 - Total Plant and Equipment: $28,000
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