Cash $ 23,000 Accounts Receivable, Net 81,000 Merchandise Inventory 185,000 Total Assets 635,000 Accounts Payable 99,000 Accrued Liabilities 37,000 Short-term Notes Payable 51,000 Long-term Liabilities 224,000 Net Income 68,000 Common Shares Outstanding 20,000 shares Current Ratio Debt Ratio Earnings per Share
Cash $ 23,000 Accounts Receivable, Net 81,000 Merchandise Inventory 185,000 Total Assets 635,000 Accounts Payable 99,000 Accrued Liabilities 37,000 Short-term Notes Payable 51,000 Long-term Liabilities 224,000 Net Income 68,000 Common Shares Outstanding 20,000 shares Current Ratio Debt Ratio Earnings per Share
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Determining the effects of business transactions on selected ratios
Financial statement data of Style Traveler Magazine include the following items:
Requirements
- Compute Style Traveler’s
current ratio , debt ratio, and earnings per share. Round all ratios to two decimal places, and use the following format for your answer: - Compute the three ratios after evaluating the effect of each transaction that follows. Consider each transaction separately
a. Purchased merchandise inventory of $49,000 on account.
b. Borrowed $127,000 on a long-term note payable.
c. issued 2,000 shares of common stock, receiving cash of $107,000.
d. Received cash on account, $5,000.
Transcribed Image Text:Cash
$ 23,000
Accounts Receivable, Net
81,000
Merchandise Inventory
185,000
Total Assets
635,000
Accounts Payable
99,000
Accrued Liabilities
37,000
Short-term Notes Payable
51,000
Long-term Liabilities
224,000
Net Income
68,000
Common Shares Outstanding
20,000 shares
Transcribed Image Text:Current Ratio
Debt Ratio
Earnings per Share
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