[The following information applies to the questions displayed below.] Wawa Food Markets is a convenience store chain located primarily in the Northeast. The company sells gas, candy bars, drinks, and other grocery- related items. St. Jude Medical Incorporated sells medical devices related to cardiovascular needs. Suppose a local Wawa Food Market and St. Jude sales office report the following amounts in the same year (company names are disguised): Company 1 $400,000 Company 2 $400,000 Net sales Cost of goods sold 180,000 330,000 Gross profit $220,000 $ 70,000 Average inventory $ 40,000 $ 30.000 Required: 1. For Company 1 and Company 2, calculate the inventory turnover ratio.

[The following information applies to the questions displayed below.] Wawa Food Markets is a convenience store chain located primarily in the Northeast. The company sells gas, candy bars, drinks, and other grocery- related items. St. Jude Medical Incorporated sells medical devices related to cardiovascular needs. Suppose a local Wawa Food Market and St. Jude sales office report the following amounts in the same year (company names are disguised): Company 1 $400,000 Company 2 $400,000 Net sales Cost of goods sold 180,000 330,000 Gross profit $220,000 $ 70,000 Average inventory $ 40,000 $ 30.000 Required: 1. For Company 1 and Company 2, calculate the inventory turnover ratio.

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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33. subject:- Accounting
Gibson Boot Co. sells men’s, women’s, and children’s boots. For each type of boot sold, it operates a separate department that has its own manager. All departments are housed in a single store. In recent years, the children’s department has operated at a net loss and is expected to continue to do so. Last year’s income statements follow. Men’s Department Women’s Department Children’s Department Sales $ 660,000 $ 480,000 $ 200,000 Cost of goods sold (269,500 ) (179,600 ) (100,875 ) Gross margin 390,500 300,400 99,125 Department manager’s salary (60,000 ) (49,000 ) (29,000 ) Sales commissions (114,200 ) (83,600 ) (31,900 ) Rent on store lease (29,000 ) (29,000 ) (29,000 ) Store utilities (12,000 ) (12,000 ) (12,000 ) Net income (loss) $ 175,300 $ 126,800 $ (2,775 ) Required a. Calculate the contribution to profit. Determine whether to eliminate the children’s…
MGM Resorts International owns and operates hotels and casinos including the MGM Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, MGM reported accounts receivable of $415,654,000 and allowance for doubtful accounts of $93,760,000. Johnson & Johnson manufactures and sells a wide range of healthcare products including Band-Aids and Tylenol. As of a recent year, Johnson & Johnson reported accounts receivable of $10,114,000,000 and allowance for doubtful accounts of $340,000,000. a. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for MGM Resorts International. Round to one decimal place.b. Compute the percentage of the allowance for doubtful accounts to the accounts receivable, for Johnson & Johnson. Round to one decimal place.c. Discuss possible reasons for the difference in the two ratios computed in (a) and (b).
State College Technology Store is a retial computer store in the university center of a large midwestern university. The school engaged in the following transactions during January of the current year. At December 31 last year, the company’s inventory amounted to $150000. Jan. 8 Purchased 20 Nonpxe laptop computers on account from Led Inc. The laptop comptuers cost $800 each. Payment is due in 30 days Jan. 10 Sold 4 Nopxe laptop computers on account to the Department of Microbiology at State College at a retail sales price of $1200. Unit cost of each laptop was $1000. a) Prepare journal entries to record these transactions assumingthat the company uses periodic inventory system b. Compute the balance of the Inventory account on January 12 assuming that the company uses periodic inventory system. c. Compute the cost of goods sold assuming use of periodic inventory system. d. To create year-end blance for cost of goods sold, please close the beginning…
[The following information applies to the questions displayed below] National Retail has two departments, Housewares and Sporting. Indirect expenses for the period follow. Rent Advertising Insurance Total $45,000 25,000 10.000 $80,000 The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect expenses to each department based on the square feet it occupied. The company now wants to allocate indirect expenses using the allocation bases shown below. Department Sporting Hotal Square Feet 1,400 2,600 4,000 Value of Insured 40,000 $100,000 Problem 22-2A (Algo) Part 1 Required: 1. Allocate indirect expenses to the two departments using the allocation method used in prior periods. Department Square Footage Sparting Total
Magio Company manufactures kitchen equipment used in hospitals. They distribute their products directly to the customer and, for the year ending 2019, they reported these revenues and expenses. Use this information to calculate the gross profit for the year 2019. Magio Company data Revenue and Expenses Sales revenue Cost of Goods Sold Operating expenses Amount $864,183 $496,357 $196,815
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Bassett Stores Company and Fox Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. Information from the financial statements for both companies for two recent years is as follows (all numbers are in millions): Bassett Fox Merchandise sales $229,950 $321,200 Credit card receivables—beginning 37,356 66,625 Credit card receivables—ending 31,188 51,295 a. (1) Determine the accounts receivable turnover for both companies. Round to one decimal place. Bassett Stores fill in the blank 1 Fox Stores fill in the blank 2 (2) Determine the days' sales in receivables for both companies. Assume there are 365 days in the year. Round intermediate calculations to the nearest whole dollar and final answers to one decimal place. Bassett Stores fill in the blank 3 days Fox Stores fill in the blank 4 days b. What conclusion can be drawn regarding the two companies and…
The following is a series of related transactions between Texas Wholesale Corp. and Boot Hill, a chain of retail stores: Texas Wholesale Corp. sold Boot Hill 100 pairs of boots on account, terms 1/10, n/30. The cost of these boots to Texas Wholesale was $32 per pair, and the sales price was $50 per pair. Feb. 9 Feb. 12 United Express charged $162 for delivering this merchandise to Boot Hill. These charges were split evenly between the buyer and seller, and were paid immediately in cash. Boot Hill returmed 10 pairs of boots to Texas Wholesale because they were the wrong style. Texas Wholesale allowed Boot Hill full credit for this return. Feb. 13 Boot Hill paid the remaining balance due to Texas Wholesale within the discount period. Feb. 19 Both companies use a perpetual inventory system. Instruciions a. Record this series of transactions in the general journal of Texas Wholesale Corp. (The com- pany records sales at gross sales price.) b Record this series of transactions in the…
Longhorn Corporation provides low-cost food delivery services to senior citizens. At the end of the year on December 31, 2021, the company reports the following amounts:Cash $ 1,200 Service revenue $67,700Equipment 29,000 Cost of goods sold 53,400Accounts payable 4,400 (food expense)Delivery expense 2,600 Buildings 40,000Salaries expense 5,500 Supplies 3,400 Salaries payable 800In addition, the company had common stock of $40,000 at the beginning of the year and issued an additional $4,000 during the year. The company also had retained earnings of $18,200 at the beginning of the year.Required: Prepare the income statement, statement of stockholders’ equity, and balance sheet for…
The XYZ Corporation owns and operates hotels and casinos including the XYZ Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, XYZ reported account receivable of $676,000 and allowance for doubtful accounts of $132,496. Patient Care manufactures and sells a wide range of healthcare products including Band-Ald bandages and Tylenol. As of a recent year, Patient Care reported accounts receivable of $891,000 and allowance for doubtrul accounts of $30,294. Round all amounts to one decimal place. a. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for the XYZ Corporation. 16.6 X % b. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for Patient Care. 3.3 x % c. Possible reasons for the difference in the two ratios computed in (a) and (b) indude: a. Casino operators historically lose money on operations. b. Casino operators have larger accounts receivable. c. Individuals who may have adequate…