Crane Inc. (CI) has a short-term working capital loan to help finance its working capital. The terms of the loan enable CI to borrow anamount of up to 35% of its inventory balance and 55% of its accounts receivable. One of the loan covenants requires that CI maintaina current ratio greater than 2. Information related to CI's current assets and current liabilities is shown in the following table:In thousandsCashAccounts receivableInventoryOther current assets,Accounts payableShort-term bank loanOther current liabilities(a)Current ratio2024CI$1612,0541,3423381.402562562023$2241,2302,3063951.343Does CI satisfy the loan covenant in both years? (Round answers to 2 decimal places, eg. 18.45)2781122024timesthe loan covenant in 2024the loan covenant in 20232023times

The liquidity ratio used to assess a company's capacity to meet short-term or one-year-due…

Answered: Crane Inc. (CI) has a short-term…

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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The data depicted in the table below were extracted from the annual financial reports of WBE enterprises for the 2021 and 2022 financial years. If all purchases are on credit, calculate the creditors payment period of WBE enterprises for the 2022 financial year. Sales (80% credit sales) Cost of sales Inventories Accounts receivable Accounts payable Cash and cash equivalents Other current liabilities OA. 214 days OB. 163 days OC. 66 days OD. 168 days 2022 R 480 000 264 000 270 000 204 000 177 000 45 750 82 500 2021 R 375 000 192 000 243 000 183 000 165 000 27 300 58 500
The amount of Gross Loans is The following are real Iife data extracted from the Housing Bank financial statements. Use them to answer the questions. Additional Information: Accumulated Provislons for Loan Losses (end balance) 250; Number of Outstanding Shares 315,000,000 (315 MIllon) and share price JD9 (Balance Sheet (in Milion (Assets (JD Cash and Balances at Central Banks Balances at Banks and Financial institutions Deposits at Banks and Financial institutions Total Cash and Due trom Depository institutions Trading Investments Available for Sale Investments Held to Maturity Investments, Net Total Securitles 1,478 743 53 2,221 581 745 1,327 Investments in Affilates 2,369 Loans (or Credit Facilities), Net 93 Fixed Assets, Net 6. Doferred income Tax Assets Other Assets Total Asseta (Uabilitles (JD Customers Deposits Banks & Financial Institutions Deposits 71 6,090 4,430 284 Total Deposits Cash Margins 4,714 290
As loan analyst for Carla Bank, you have been presented the following information. Toulouse Co. Lautrec Co. Assets Cash $124,000 $335,000 Receivables 214,000 305,000 Inventories 589,000 523,000 Total current assets 927,000 1,163,000 Other assets 482,000 582,000 Total assets $1,409,000 $1,745,000 Liabilities and Stockholders’ Equity Current liabilities $301,000 $368,000 Long-term liabilities 409,000 482,000 Capital stock and retained earnings 699,000 895,000 Total liabilities and stockholders’ equity $1,409,000 $1,745,000 Annual sales $946,000 $1,559,000 Rate of gross profit on sales 30 % 40 % Each of these companies has requested a loan of $50,000 for 6 months with no collateral offered. Because your bank has reached its quota for loans of this type, only one of these requests is to be…
From the following information, calculate current ratio. Trade receivables (debtors) 1, 00,000 Bills payable 20,000 Prepaid Expenses 10,000 Sundry Creditors 40,000 Cash and cash equivalents 30,000 Debentures 2,00,000 Short term investments 20,000 Inventories 40,000 Machinery 7,000 Expenses Payable asap
Use the information provided for Privett Company to answer the question that follow. Privett Company Accounts payable $30,000 Accounts receivable 35,000 Accrued liabilities 7,000 Cash 25,000 Intangible assets 40,000 Inventory 72,000 Long-term investments 100,000 Long-term liabilities 75,000 Notes payable (short-term) 20,000 Property, plant, and equipment 400,000 Prepaid expenses 2,000 Temporary investments 36,000 Based on the data for Privett Company, what is the amount of quick assets? a.$168,000 b.$96,000 c.$61,000 d.$60,000
Suppose an SEVP tells you that last year a bank had total interest expenses on all borrowings of BDT 12 million and noninterest expenses of BDT 5 million, while interest income from earning assets totaled BDT 16 million and noninterest revenues totaled BDT 2 million. Suppose further that assets amounted to BDT 480 million, of which earning assets represented 85 percent of that total asset while total interest-bearing liabilities amounted to 75 percent of total assets. See if you can determine the bank’s net interest and non-interest margins and its earnings base and earnings spread for the most recent year.
compute for the following...
As loan analyst for Wildhorse Bank, you have been presented the following information. Toulouse Co. Lautrec Co. Assets Cash $119,000 $332,000 Receivables 226,000 298,000 Inventories 562,000 536,000 Total current assets 907,000 1,166,000 Other assets 483,000 636,000 Total assets $1,390,000 $1,802,000 Liabilities and Stockholders' Equity. Current liabilities $319,000 $350,000 Long-term liabilities 419.000 483,000 Capital stock and retained earnings 652,000 969,000 Total liabilities and stockholders' equity $1,390,000 $1,802,000 Annual sales $948,000 $1,453,000 Rate of gross profit on sales 30 % 40 % Each of these companies has requested a loan of $50,000 for 6 months with no collateral offered. Because your bank has reached its quota for loans of this type, only one of these requests is to be granted. Compute the various ratios for each company. (Round answer to 2 decimal places, eg. 2.25.) Toulouse Co. Lautrec Co. Current ratio :1 Acid-test ratio Accounts receivable turnover times times…
Profile Co has the following assets and liabilities: Assets: Cash $100 , account receivable,$150 ; Inventory,$240 ,land $200, plant net of accumulated amortization $300 : liabilities short term bank loan, $60 : accounts payable long term loan mortage loan ,$160 ,profolio co long term assets total was
Hoffman Paper Company, a profitable distributor of stationery and office supplies, has an agreement with its banks that allows Hoffman to borrow money on a short-term basis to finance its inventories and accounts receivable. The agreement states that Hoffman must maintain a current ratio of 1.5 or higher and a debt ratio of 50 percent or lower. Cash 2$ 55,000 Current liabilities $ 210,000 Accounts receivable 150,000 Long-term debt 300,000 Inventory 255,000 Stockholders' equity 630,000 Fixed assets (net) 680,000 Total liabilities and stockholders' equity $1,140,000 Total assets $1,140,000 Given the balance sheet provided above, determine how much additional money Hoffman could borrow at this time to invest in inventory and accounts receivable without violating the terms of its borrowing agreement. Round your answer to the nearest dollar. $
As loan analyst for Waterway Bank, you have been presented the following information. Toulouse Co. Lautrec Co. Assets Cash $114,000 $328,000 Receivables 230,000 296,000 Inventories 582,000 493,000 Total current assets 926,000 1,117,000 Other assets 493,000 607,000 Total assets $1,419,000 $1,724,000 Liabilities and Stockholders' Equity Current liabilities $314,000 $340,000 Long-term liabilities 385,000 493,000 Capital stock and retained earnings 720,000 891,000 Total liabilities and stockholders' equity $1,419,000 $1,724,000 Annual sales $911,000 $1,440,000 Rate of gross profit on sales 30 % 40 % Each of these companies has requested a loan of $50,000 for 6 months with no collateral offered. Because your bank has reached its quota for loans of this type, only one of these requests is to be granted. Compute the various ratios for each company. (Round answer to 2 decimal places, e.g. 2.25.) Toulouse Co. Lautrec Co. Current ratio :1 :1 Acid-test ratio :1 :1 Accounts receivable turnover…
You are considering two possible companies for investment purposes. The following data is available for each company. Company A Net credit sales, Dec. 31, 2019 $540,000 Net Accounts receivable, Dec 31, 2018 $120,000 Net accounts receivable, Dec 31, 2019 $180,000 Number of days sales in receivables ratio, 2018 103 days Net Income, Dec. 31, 2018 $250,000 Company B Net credit sales, Dec. 31, 2019 $620,000 Net Accounts receivable, Dec 31, 2018 $145,000 Net accounts receivable, Dec 31, 2019 $175,000 Number of days sales in receivables ratio, 2018 110 days Net Income, Dec. 31, 2018 $350,000 Additional Information: Company A: Bad debt estimation percentage using the income statement method is 6%, and the balance sheet…

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