[The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity Days' Sales In Inventory Current Year Current Year: 1 Year Ago: $ 33,204 89,000 Days' sales in inventory 111,000 10,693 324,561 $568,458 $140,131 105,801 162,500 160,026 $568,458 $ 450,787 229,088 12,563 9,607 1 Year Ago 1 $ 38,812 62,000 82,000 1 10,188 297,050 $ 490,050 1 $81,990 111,584 162,500 133,976 $ 490,050 The company's income statements for the current year and one year ago follow. Assume that all sales are on credit: For Year Ended December 31 Current Year 1 Year Ago Sales $ 738,995 Cost of goods sold Other operating expenses 702,045 $36,950 $2.27 Interest expense Income tax expense Total costs and expenses Net income Earnings per share (4-a) Compute days' sales in inventory. (4-b) For each ratio, determine if it improved or worsened in the current year. Compute days' sales in inventory. 8,747 2 Years Ago $ 40,429 51,000 58,000 X 4,492 258,579 $ 412,500 X $ 53,905 x 90,251 $ 379,054 147,539 13,413 162,500 105,844 $ 412,500 Numerator: Denominator: x Days = Days' Sales In Inventory = Days' sales in inventory For each ratio, determine if it improved or worsened in the current year. = $ 583,160 = 548,753 $ 34,407 $ 2.12 days days
[The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity Days' Sales In Inventory Current Year Current Year: 1 Year Ago: $ 33,204 89,000 Days' sales in inventory 111,000 10,693 324,561 $568,458 $140,131 105,801 162,500 160,026 $568,458 $ 450,787 229,088 12,563 9,607 1 Year Ago 1 $ 38,812 62,000 82,000 1 10,188 297,050 $ 490,050 1 $81,990 111,584 162,500 133,976 $ 490,050 The company's income statements for the current year and one year ago follow. Assume that all sales are on credit: For Year Ended December 31 Current Year 1 Year Ago Sales $ 738,995 Cost of goods sold Other operating expenses 702,045 $36,950 $2.27 Interest expense Income tax expense Total costs and expenses Net income Earnings per share (4-a) Compute days' sales in inventory. (4-b) For each ratio, determine if it improved or worsened in the current year. Compute days' sales in inventory. 8,747 2 Years Ago $ 40,429 51,000 58,000 X 4,492 258,579 $ 412,500 X $ 53,905 x 90,251 $ 379,054 147,539 13,413 162,500 105,844 $ 412,500 Numerator: Denominator: x Days = Days' Sales In Inventory = Days' sales in inventory For each ratio, determine if it improved or worsened in the current year. = $ 583,160 = 548,753 $ 34,407 $ 2.12 days days
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![[The following information applies to the questions displayed below.]
Simon Company's year-end balance sheets follow.
At December 31
Current Year
Assets
Cash
Accounts receivable, net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Days' Sales In Inventory
Current Year:
1 Year Ago:
$ 33,204
89,000
Days' sales in inventory
111,000
10,693
324,561
$568,458
$140,131
105,801
162,500
160,026
$568,458
$ 450,787
229,088
12,563
9,607
1 Year Ago
1
1
$ 38,812
62,000
82,000
1
10,188
297,050
$ 490,050
$81,990
111,584
162,500
133,976
$ 490,050
The company's income statements for the current year and one year ago follow. Assume that all sales are on credit:
For Year Ended December 31 Current Year 1 Year Ago
Sales
$ 738,995
Cost of goods sold
Other operating expenses
Interest expense
Income tax expense
Total costs and expenses
Net income
Earnings per share
(4-a) Compute days' sales in inventory.
(4-b) For each ratio, determine if it improved or worsened in the current year.
Compute days' sales in inventory.
702,045
$36,950
$2.27
8,747
2 Years Ago
$ 40,429
X
51.000
58,000
4,492
258,579
$ 412,500
X
$ 53,905
x
90,251
$ 379,054
162,500
105,844
147,539
13,413
$ 412,500
Numerator: Denominator: x Days = Days' Sales In Inventory
= Days' sales in inventory
For each ratio, determine if it improved or worsened in the current year.
$ 583,160
=
548,753
$ 34,407
$ 2.12
days
days](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F909ce828-d991-4235-9779-ef16f042b27f%2F49fe231a-8eb4-45cd-861e-762f8b536f93%2Fil7tid6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:[The following information applies to the questions displayed below.]
Simon Company's year-end balance sheets follow.
At December 31
Current Year
Assets
Cash
Accounts receivable, net
Merchandise inventory
Prepaid expenses
Plant assets, net
Total assets
Liabilities and Equity
Accounts payable
Long-term notes payable
Common stock, $10 par value
Retained earnings
Total liabilities and equity
Days' Sales In Inventory
Current Year:
1 Year Ago:
$ 33,204
89,000
Days' sales in inventory
111,000
10,693
324,561
$568,458
$140,131
105,801
162,500
160,026
$568,458
$ 450,787
229,088
12,563
9,607
1 Year Ago
1
1
$ 38,812
62,000
82,000
1
10,188
297,050
$ 490,050
$81,990
111,584
162,500
133,976
$ 490,050
The company's income statements for the current year and one year ago follow. Assume that all sales are on credit:
For Year Ended December 31 Current Year 1 Year Ago
Sales
$ 738,995
Cost of goods sold
Other operating expenses
Interest expense
Income tax expense
Total costs and expenses
Net income
Earnings per share
(4-a) Compute days' sales in inventory.
(4-b) For each ratio, determine if it improved or worsened in the current year.
Compute days' sales in inventory.
702,045
$36,950
$2.27
8,747
2 Years Ago
$ 40,429
X
51.000
58,000
4,492
258,579
$ 412,500
X
$ 53,905
x
90,251
$ 379,054
162,500
105,844
147,539
13,413
$ 412,500
Numerator: Denominator: x Days = Days' Sales In Inventory
= Days' sales in inventory
For each ratio, determine if it improved or worsened in the current year.
$ 583,160
=
548,753
$ 34,407
$ 2.12
days
days
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