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Compute the following ratios at December 31, 2021: (Use 365 days for calculation. Round answers to 1 decimal place, e.g. 52.7.) (a) (b) (d) Current ratio (c) Average collection period (e) Accounts receivable turnover Inventory turnover Days in inventory 2.8 5.3 69 :1 times days times days

Compute the following ratios at December 31, 2021: (Use 365 days for calculation. Round answers to 1 decimal place, e.g. 52.7.) (a) (b) (d) Current ratio (c) Average collection period (e) Accounts receivable turnover Inventory turnover Days in inventory 2.8 5.3 69 :1 times days times 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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I was successful with finding the totals for all the other answers but I cant figure the last two out. I know that I need to use average inventory but there is not beginning and ending inventory.

### Financial Ratios Calculation **Objective:** Compute the following financial ratios as of December 31, 2021. Use 365 days for calculation and round answers to one decimal place (e.g., 52.7). 1. **Current Ratio:** - Value: 2.8:1 2. **Accounts Receivable Turnover:** - Value: 5.3 times 3. **Average Collection Period:** - Value: 69 days 4. **Inventory Turnover:** - [Data Not Provided] 5. **Days in Inventory:** - [Data Not Provided] These financial ratios help in assessing the company's efficiency in managing its assets and liabilities.
Transcribed Image Text:### Financial Ratios Calculation **Objective:** Compute the following financial ratios as of December 31, 2021. Use 365 days for calculation and round answers to one decimal place (e.g., 52.7). 1. **Current Ratio:** - Value: 2.8:1 2. **Accounts Receivable Turnover:** - Value: 5.3 times 3. **Average Collection Period:** - Value: 69 days 4. **Inventory Turnover:** - [Data Not Provided] 5. **Days in Inventory:** - [Data Not Provided] These financial ratios help in assessing the company's efficiency in managing its assets and liabilities.
**Balance Sheet Comparison for 2021 and 2020** **Assets** - **Cash** - 2021: $40,200 - 2020: $30,000 - **Accounts Receivable (Net)** - 2021: $86,000 - 2020: $81,000 - **Inventory** - 2021: $81,000 - 2020: $71,000 - **Property, Plant and Equipment (Net)** - 2021: $206,000 - 2020: $201,000 **Total Assets** - 2021: $413,200 - 2020: $383,000 **Liabilities and Shareholders' Equity** - **Accounts Payable** - 2021: $74,000 - 2020: $81,000 - **Mortgage Payable (15%, due in 15 years)** - 2021: $121,000 - 2020: $121,000 - **Common Stock, $10 Par** - 2021: $161,000 - 2020: $141,000 - **Retained Earnings** - 2021: $57,200 - 2020: $40,000 **Total Liabilities and Shareholders' Equity** - 2021: $413,200 - 2020: $383,000 **Additional Information for 2021:** 1. **Net Income** - $46,000 2. **Sales on Account** - $471,000 - Sales returns and allowances: $28,450 3. **Cost of Goods Sold** - $364,800 4. **Net Cash Provided by Operating Activities** - $70,000 This financial summary provides a year-over-year comparison of assets, liabilities, and equity, highlighting key financial changes and performance indicators for 2021.
Transcribed Image Text:**Balance Sheet Comparison for 2021 and 2020** **Assets** - **Cash** - 2021: $40,200 - 2020: $30,000 - **Accounts Receivable (Net)** - 2021: $86,000 - 2020: $81,000 - **Inventory** - 2021: $81,000 - 2020: $71,000 - **Property, Plant and Equipment (Net)** - 2021: $206,000 - 2020: $201,000 **Total Assets** - 2021: $413,200 - 2020: $383,000 **Liabilities and Shareholders' Equity** - **Accounts Payable** - 2021: $74,000 - 2020: $81,000 - **Mortgage Payable (15%, due in 15 years)** - 2021: $121,000 - 2020: $121,000 - **Common Stock, $10 Par** - 2021: $161,000 - 2020: $141,000 - **Retained Earnings** - 2021: $57,200 - 2020: $40,000 **Total Liabilities and Shareholders' Equity** - 2021: $413,200 - 2020: $383,000 **Additional Information for 2021:** 1. **Net Income** - $46,000 2. **Sales on Account** - $471,000 - Sales returns and allowances: $28,450 3. **Cost of Goods Sold** - $364,800 4. **Net Cash Provided by Operating Activities** - $70,000 This financial summary provides a year-over-year comparison of assets, liabilities, and equity, highlighting key financial changes and performance indicators for 2021.
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