Example onehe information below has been extracted from the recently published accounts of Gabby Itd:Extracts from the income statement to 3gn April 2016;2015SalesCost of sales2016(000)11,200(00)9,7506.8258,460Net profit before tax465320The following expenses were chargedDepreciationLoan note interestInterest on bank overdraftAudit fees3602808060151210Tax4030Balance sheet as at 30h April:20162015(000)(000)00)(000)AssetsFixed assetsCurrent assetsInventoryReceivables1.8501,4306404901.0801201,230Cash801,9503,8001,6903,120Total assetsEquity and liabilitiesOrdinary share capitalRetained earnings8008001.3102,1109301.73018 Non current liabilities10% loan stock600800Curre WabilitiesBank overdraftFayablesTaxation80690201107508903.8007903.12030he fotlowing ratios were calculated by Gabby Itd based on its published financial statements for 2014and also the latest industry average ratios;Industry averageGabby Itd 2014Current ratio21.9Quick ratio1.271.4218.5%ROCE16.7%3.9%4.29x30%40 days30 days4.73%Net profit marginAsset turnover3.91x35.23%52 days49 daysGross profit marginAccounts receivable collection periodAccounts payable payment periodInventory turnoverCapital gearing13.9x18.3x26.37%32.71%Requireda. Calculate comparable ratios for Gabby Itd.b. Compare your results against the previous year's and against the industrial average.

It is the analysis of a company's performance under different dimensions such as profitability,…

Example one The information below has been extracted from the recently published accounts of Gabby itd: Extracts from the income statement to 3O April 2016; 2015 Sales Cost of sales Net profit before tax 2016 (000) 11.200 8,460 465 (000) 9,750 6.825 320 The following expenses were charged Depreciation Loan note interest Interest on bank overdraft Audit fees Tax 360 280 80 60 15 6. 10 30 12 40

Example one The information below has been extracted from the recently published accounts of Gabby itd: Extracts from the income statement to 3O April 2016; 2015 Sales Cost of sales Net profit before tax 2016 (000) 11.200 8,460 465 (000) 9,750 6.825 320 The following expenses were charged Depreciation Loan note interest Interest on bank overdraft Audit fees Tax 360 280 80 60 15 6. 10 30 12 40

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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1 Condensed financial statements for Games Galore are summarized below: 2 3 Balance Sheet 4 Cash 5 Accounts Receivable, Net 6 Inventory 7 Prepaid Insurance 8 Total Current Assets 9 Property and Equipment, Net 10 Total Assets 11 12 Current Liabilities 13 Long-term Liabilities 14 Total Liabilities 15 Contributed Capital 16 Retained Earnings 17 Total Stockholders' Equity 18 Total Liabilities and Stockholders' Equity 19 20 Income Statement 21 Net Sales (all on account) 22 Cost of Goods Sold 23 Gross Profit 24 Operating Expenses 25 Income from Operations 26 Interest Expense 27 Income before Income Tax Expense 28 Income Tax Expense 29 Net Income 30 READY Attempt(s) Sheet1 $ $ $ $ B $ 2016 185,000 $ 80,000 104,000 11,900 380,900 514,500 895,400 $ 85,300 284,000 369,300 299,000 227,100 526,100 895,400 $ $ 3,031,000 1,949,000 1,082,000 891,400 $ 190,600 14,500 176,100 47,000 129,100 4 C 2015 143,000 59,000 134,000 5,880 341,880 407,000 748,880 96,800 224,000 320,800 299,000 129,080 428,080…
The following select financial statement information from Candid Photography. CANDID PHOTOGRAPHY Year Net Credit Sales Ending Accounts Receivable 2017 $2,988,000 $1,290,450 2018 2019 3,750,860 4,000,350 1,345,600 1,546,550 Compute the accounts receivable turnover ratios and the number of days' sales in receivables ratios for 2018 and 2019 (round answers to two decimal places). What is the Average Accounts Receivable? What is the Net Credit Sales that would be used? What is the Accounts Relievable Turnover? what is the Days in Receivable Ratio?
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Profit Margin for 2 years
The following data was generated as of December 31Accounts receivable, Jan 1 550,000.00Accounts receivable collected 875,000.00Cash Sales 350,000.00Inventory, January 1 450,000.00Inventory, December 31 275,000.00Purchases 950,000.00Gross Margin on Sales 375,000.00 a.) How much is the total sales?b.) How much is the cost of sales?c.) How much is the ending Receivable as of Dec 31?d.) How is the credit sales?
3. Conceptual Connection: The weighted average for the 4 years (rounded to three decimals) is If credit sales for 2024 are $400,000, what rate would you recommend to estimate bad debts? A rate closer to Feedback Check My Work 1 & 2. Use the data from prior years to calculate losses from uncollectible accounts as a percentage of credit sales. Consider how the loss rate has changed over the years. Feedback 4. If credit sales for 2024 are $400,000 and using the rate you recommended above, record bad debt expense for 2024. Round your answer to three decimal places. Bad Debt Expense 27,600 X Allowance for Doubtful Accounts Record adjusting entry for bad debt expense estimate Check My Work 4. Make the best estimate of bad debt expense you can. 0.069. Increase 0.082 X would be more conservative. 5. Conceptual Connection: Using the data from 2020 through 2023, estimate the change in income from operations in total for those 4 years assuming (a) the average gross margin is 25% and (b) 50% of…
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15. Zeta Company reported sales revenue of P4,600,000 in its income statement for the year ended December 31, 2011. Additional information is given below. Under the cash basis of accounting, what amount should be reported as sales revenue for 2011? 12/31/2010 12/31/2011 Accounts receivable 1,000,000 1,300,000 Allowance for uncollectible accounts 60,000 110,000 Zeta wrote off uncollectible accounts totaling P20,000 during 2011. O a. 4,900,000 O b. 4,350,000 O c. 4,300,000 O d. 4,280,000
Receivables using Columbia Sportswear 2017 Annual Report Income Statement Net sales Cost of sales Gross profit Selling, general and administrative expenses Net licensing income Income from operations Interest income, net Interest expense on note payable to related party (Note 21) Other non-operating expense Income before income tax Income tax expense (Note 10) Net income In the footnotes, they provided the following information: T Trade accounts receivable Allowance for doubtful accounts Accounts receivable, net 1. What was bad debt expense for 2017? Using the following T account if helpful. Allowance for bad debts 8556 3296 Other information Columbia Sportswear reported net accounts receivables on its balance sheet of $364,862. In another footnote, they disclosed that write-offs of receivables were $2,809. 2809 9043 2. Did Columbia Sportswear collect cash faster or slower in 2017 as compared to 2016? To aid you complete the following schedule % of Sales uncollected at the end of 2017…
Use the following to answer questions 28-29: Accounts receivable Allowance Cash realizable value 12/31/2016 $525,000 (45,000) $480.000 During 2017, sales on account were $145,000 and collections on account were $86,000. Also during 2017; the company wrote off $8,000 in uncollectible accounts. An analysis of outstanding receivable accounts at year end indicated that bad debts should be estimated at $54,000. 28. The change in the cash realizable value from the balance at 12/31/2016 to 12/31/2017 was a:. A) $50,000 B) $59,000. C) $42,000 D) $51,000 29. Bad debts expense for 2017 is: A) $17,000 B) $9,000 C) $54,000 D) $1,000
Accounts Receivable $67,000 Allowance for Doubtful Accounts 1,300 (credit) During 2016, sales on credit amounted to $582,000, $552,800 was collected on outstanding receivables and $2,600 of receivables were written off as uncollectible. On December 31, 2016, Shelton estimates its bad debts to be 4% of the outstanding gross accounts receivable balance. Required: 1. Prepare the journal entry necessary to record Shelton’s estimate of bad debt expense for 2016. 2. Prepare the Accounts Receivable section of Shelton’s December 31, 2016, balance sheet. 3. Compute Shelton’s receivables turnover. (Round to one decimal place.) 4. If Sheldon uses IFRS, what might be the heading for the accounts receivable section in Requirement 2?
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