From page 8-5 of the VLN, what was thecompany's current ratio before paying offthe A/P (carry out to one decimal place)? GAIN CONTINGENCIES-not recorded until gain is certain- Conservatism-ANALYSISLiquidity is being able to pay current debtsWorking Capital = CA - CLCurrent RatioCA/CLAcid-test Ratio aka Quick Ratio = (Cash + Current investments+A/R)/CL--does not include inventory or prepaid-assets--uses assets that can be easily converted to cashPracticeUA, Inc., shows the following balance sheet accounts;IDENTIFY the CURRENT assets & liabilities:AssetsLiabilities$25,00020,0001,000,00015,00075,000Cash$50,000 Note payable due in six monthsAccounts receivableLand30,000 Accounts payable200,000 Bond Payable70,000 Payroll taxes payableShort term investmentsPPE, net1,250,000 Note payable due in 18 monthsInventoryIntangible assets55,000 Current portion of Long Term Debt45,000 Deferred revenue10,0005,00050,000Other current5,000 Long Term DebtDetermine totalCURRENT Assets:Determine TotalCURRENT Liabilities:Calculate working capital:Calculate the current ratio:Calculate the quick ratio:Assume UA paid off its A/P with cash; re-calculate:Working capital:Current ratio:Quick ratio:

Name: From page 8-5 of the VLN, what was thecompany's current ratio before
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Description: From page 8-5 of the VLN, what was thecompany's current ratio before paying offthe A/P (carry out to one decimal place)? GAIN CONTINGENCIES-not recorded until gain is certain- Conservatism-ANALYSISLiquidity is being able to pay current debtsWorking

when talking about Finance for the business liquidity is considered to be a major issue in terms of…

Business

Accounting

Conservatism ANALYSIS Liquidity is being able to pay current debts Working Capital = CA - CL Current Ratio CA/CL Acid-test Ratio aka Quick Ratio = (Cash + Current investments +A/R)/CL --does not include inventory or prepaid-assets --uses assets that can be easily converted to cash Practice UA, Inc., shows the following balance sheet accounts; IDENTIFY the CURRENT assets & liabilities: Assets Liabilities Cash Accounts receivable Land Short term investments PPE, net Inventory Intangible assets Other current $50,000 Note payable due in six months 30,000 Accounts payable 200,000 Bond Payable 70,000 Payroll taxes payable 1,250,000 Note payable due in 18 months 55,000 Current portion of Long Term Debt 45,000 Deferred revenue $25,000| 20,000 1,000,000 15,000 75,000 10,000| 5,000 50,000 5,000 Long Term Debt Determine total CURRENT Assets: Determine Total CURRENT Liabilities: Calculate working capital: Calculate the current ratio: %24

Conservatism ANALYSIS Liquidity is being able to pay current debts Working Capital = CA - CL Current Ratio CA/CL Acid-test Ratio aka Quick Ratio = (Cash + Current investments +A/R)/CL --does not include inventory or prepaid-assets --uses assets that can be easily converted to cash Practice UA, Inc., shows the following balance sheet accounts; IDENTIFY the CURRENT assets & liabilities: Assets Liabilities Cash Accounts receivable Land Short term investments PPE, net Inventory Intangible assets Other current $50,000 Note payable due in six months 30,000 Accounts payable 200,000 Bond Payable 70,000 Payroll taxes payable 1,250,000 Note payable due in 18 months 55,000 Current portion of Long Term Debt 45,000 Deferred revenue $25,000| 20,000 1,000,000 15,000 75,000 10,000| 5,000 50,000 5,000 Long Term Debt Determine total CURRENT Assets: Determine Total CURRENT Liabilities: Calculate working capital: Calculate the current ratio: %24

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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Net working capital increases when: A. a credit customer pays for his or her purchase B. inventory is sold at cost. C. fixed assets are purchased for cash D. inventory is purchased on credit
A) Comment on any significant changes in each company in the composition of current assets and current liabilities. Explain. b) Which assets in each company have the most significant investment? Why? c) Are the companies financed primarily with debt or equity? Why?
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Assets Current assets Cash and cash equivalents Accounts receivable, net Supplies Other current assets Total current assets Property and equipment Accumulated depreciation Net property and equipment Goodwill Deferred charges Other Total assets Liabilities and equity Current liabilities Accounts payable Accrued liabilities Current maturities of long-term debt Total current liabilities Operating lease liabilities non-current Long-term debt Other non-current liabilities Total liabilities Total liabilities Common stock Cummulative dividends Retained earnings Other Total equity Total liabilities and equities Revenue, net Operating charges Salaries, wages, and benefits Other operating expenses Supplies expense Depreciation and amortization Lease and rental expense Total operating charges Income from operations Interest expense, net Other (income) expense, net Income before income taxes Provision for income taxes Net income $61,268 1,560,847 Cost of debt (%) Cost of equity (%) Weighted…
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Assets Current assets Cash and cash equivalents Accounts receivable, net Supplies Other current assets Total current assets Property and equipment Accumulated depreciation Net property and equipment Goodwill Deferred charges Other Total assets Liabilities and equity Current liabilities Accounts payable Accrued liabilities Current maturities of long-term debt Total current liabilities Operating lease liabilities non-current Long-term debt Other non-current liabilities Total liabilities Total liabilities Common stock Cummulative dividends Retained earnings Other Total equity Total liabilities and equities Revenue, net Operating charges Salaries, wages, and benefits Other operating expenses Supplies expense Depreciation and amortization Lease and rental expense Total operating charges Income from operations Interest expense, net Other (income) expense, net Income before income taxes Provision for income taxes Net income $61,268 1,560,847 Cost of debt (%) Cost of equity (%) Weighted…