ratio. Deana Company's working capital accounts at December P17-11 Effect of various tran given below: Cash Marketable securities Accounts receivable (net) Inventory Prepaid expenses Accounts payable Notes due within one year Accrued llabilities. S 50,000 30,000 200,000 210,000 10,000 150,000 30,000 20,000 During 19x7, Denna Company completed the following transactions Paid a cash dividend previously declared, S12,000. 2 Lssued additional shares of capital stock for cash, $100.000 Sold inventory costing $50,000 for $80,000, on accous Wrote off uncollectible accounts in the amount of $10,000. d. Declared a cash dividend, $15,000. Paid accounts payable, $50,000. f. Borrowed cash on a short-term note with the bank, $35,000. Sold inventory costing $15,000 for SI0,000 cash. Purchased inventory on account, $60,000. DI Paid off all short-term notes due, $30,000. Purchased equipment for cash, $15,000. Sold marketable securities costing $18,000 for cash, $15,000 1Collected cash on accounts receivable, $80,000. c. e. h. k. equired: 1. (Compute the following amounts and ratios as of December 31 to Working capital. b. Current ratio. Acid-test ratio. C. ff of each of the transactions oiven

ratio. Deana Company's working capital accounts at December P17-11 Effect of various tran given below: Cash Marketable securities Accounts receivable (net) Inventory Prepaid expenses Accounts payable Notes due within one year Accrued llabilities. S 50,000 30,000 200,000 210,000 10,000 150,000 30,000 20,000 During 19x7, Denna Company completed the following transactions Paid a cash dividend previously declared, S12,000. 2 Lssued additional shares of capital stock for cash, $100.000 Sold inventory costing $50,000 for $80,000, on accous Wrote off uncollectible accounts in the amount of $10,000. d. Declared a cash dividend, $15,000. Paid accounts payable, $50,000. f. Borrowed cash on a short-term note with the bank, $35,000. Sold inventory costing $15,000 for SI0,000 cash. Purchased inventory on account, $60,000. DI Paid off all short-term notes due, $30,000. Purchased equipment for cash, $15,000. Sold marketable securities costing $18,000 for cash, $15,000 1Collected cash on accounts receivable, $80,000. c. e. h. k. equired: 1. (Compute the following amounts and ratios as of December 31 to Working capital. b. Current ratio. Acid-test ratio. C. ff of each of the transactions oiven

Name: ratio. Deana Company's working capital accounts at DecemberDuring 19x
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Description: ratio. Deana Company's working capital accounts at DecemberDuring 19x7, Denna Company completed the following transactionsP17-11Effect of various transagiven below:CashMarketable securitiesAccounts receivable (net)Inventory- Prepaid expensesAccounts

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Problem 1Q

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Concept explainers

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is

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Question

ratio. Deana Company's working capital accounts at December
During 19x7, Denna Company completed the following transactions
P17-11
Effect of various transa
given below:
Cash
Marketable securities
Accounts receivable (net)
Inventory
- Prepaid expenses
Accounts payable
Notes due within one year
Accrued llabilities.
S 50,000
30,000
200,000
210,000
10,000
150,000
30,000
20,000
R Paid a cash dividend previously declared, $12.000
b. Soid inventory costing $50,000 for $30,000, on account
Wrote off uncollectible accounts in the amount of $10 000
Declared a cash dividend, $15,000.
Paid accounts payable, $50,000.
f. Borrowed cash on a short-term note with the bank, $35.000
A Sold inventory costing $15,000 for SI0,000 cash.
Purchased inventory on account, $60,000.
DI Paid off all short-term notes due, $30,000.
Purchased equipment for cash, $15,000.
d.
e.
h.
j.
Sold marketable securities costing $18,000 for cash, $15,000
k.
Collected cash on accounts receivable, $80,000.
ves
Compute the following amounts and ratios as of December 31, 1o
Working capital.
Current ratio.
Acid-test ratio.
For 19x7, indicate the effect of each of the transactions given above on
Required:
1.
b.
c.
2.
capital, the current ratio, and the acid-test ratio. Give the effect in
increase, decrease, or none. Item (x) is given below as an exam
format to use:
The effect on
Working
capital
Current
Acid-test
ratio
Transaction
ratio
(x).
None
Increase
Increase

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