Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following. Compute the accounts receivable turnover ratios for each company for 2018 and 2019. Compute the number of days’ sales in receivables ratios for each company for 2018 and 2019. Determine which company is the better investment and why. Round answers to two decimal places.
Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following. Compute the accounts receivable turnover ratios for each company for 2018 and 2019. Compute the number of days’ sales in receivables ratios for each company for 2018 and 2019. Determine which company is the better investment and why. Round answers to two decimal places.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following.
- Compute the
accounts receivable turnover ratios for each company for 2018 and 2019. - Compute the number of days’ sales in receivables ratios for each company for 2018 and 2019.
- Determine which company is the better investment and why. Round answers to two decimal places.
![LEGUMES PLUS
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
BEAN SUPERSTORE
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
2019
2018
2017
2019
2018
2017
Assets
Cash
Accounts Receivable
$345,600
67,000
$330,460
62,000
178,011
101,202
$300,000
59,000
155,205
103,085
$407,000
85,430
128,080
182,006
$386,450
82,670
40,036
23,400
$356,367
79,230
Inventory
Equipment
145,830
100,465
52,142
111,701
Total Assets
$658,895
$671,673
$617,290
$802,516
$532,556
$599,440
Liabilities
Salaries Payable
Accounts Payable
Notes Payable
$ 84,209
69,331
58,250
$ 88,563
$ 95,100
62,430
63,222
$ 91,455
$ 90,200
70,000
41,000
71,670
50,650
86,331
67,880
$ 89,467
87,197
68,312
Equity
Common Stock
Retained Earnings
$ 19,100
$ 22,695
435,000
$ 20,990
439,800
$ 25,464
556,300
$ 22,090
264,800
$ 22,188
332,276
386,400
Total Liabilities and Equity
$658,895
$671,673
$617,290
$802,516
$532,556
$599,440](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F919f2f91-b718-4211-b122-797d5d2c6e49%2F59fbf950-726d-4fa5-ab13-eac32f6c3d1c%2F2w8tix6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:LEGUMES PLUS
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
BEAN SUPERSTORE
Comparative Balance Sheet
December 31, 2017, 2018, and 2019
2019
2018
2017
2019
2018
2017
Assets
Cash
Accounts Receivable
$345,600
67,000
$330,460
62,000
178,011
101,202
$300,000
59,000
155,205
103,085
$407,000
85,430
128,080
182,006
$386,450
82,670
40,036
23,400
$356,367
79,230
Inventory
Equipment
145,830
100,465
52,142
111,701
Total Assets
$658,895
$671,673
$617,290
$802,516
$532,556
$599,440
Liabilities
Salaries Payable
Accounts Payable
Notes Payable
$ 84,209
69,331
58,250
$ 88,563
$ 95,100
62,430
63,222
$ 91,455
$ 90,200
70,000
41,000
71,670
50,650
86,331
67,880
$ 89,467
87,197
68,312
Equity
Common Stock
Retained Earnings
$ 19,100
$ 22,695
435,000
$ 20,990
439,800
$ 25,464
556,300
$ 22,090
264,800
$ 22,188
332,276
386,400
Total Liabilities and Equity
$658,895
$671,673
$617,290
$802,516
$532,556
$599,440
![LEGUMES PLUS
Comparative Income Statement
Year Ended December 31, 2017, 2018, and 2019
BEAN SUPERSTORE
Comparative Income Statement
Year Ended December 31, 2017, 2018, and 2019
2019
2018
2017
2019
2018
2017
Net Credit Sales
$1,000,000
$984,400
$875,350
$1,256,300
$1,020,570
$967,478
Cost of Goods Sold
450,000
419,600
388,950
500,000
580,320
465,780
Gross Margin
550,000
564,800
486,400
756,300
440,250
501,698
100,000
200,000
Expenses
Net Income (Loss)
115,000
125,000
175,450
169,422
435,000
439,800
386,400
556,300
264,800
332,276](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F919f2f91-b718-4211-b122-797d5d2c6e49%2F59fbf950-726d-4fa5-ab13-eac32f6c3d1c%2Fwqbqr7v_processed.jpeg&w=3840&q=75)
Transcribed Image Text:LEGUMES PLUS
Comparative Income Statement
Year Ended December 31, 2017, 2018, and 2019
BEAN SUPERSTORE
Comparative Income Statement
Year Ended December 31, 2017, 2018, and 2019
2019
2018
2017
2019
2018
2017
Net Credit Sales
$1,000,000
$984,400
$875,350
$1,256,300
$1,020,570
$967,478
Cost of Goods Sold
450,000
419,600
388,950
500,000
580,320
465,780
Gross Margin
550,000
564,800
486,400
756,300
440,250
501,698
100,000
200,000
Expenses
Net Income (Loss)
115,000
125,000
175,450
169,422
435,000
439,800
386,400
556,300
264,800
332,276
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education