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Use the following information for Transylvania Railroad: Long-term debt ratio: 0.4 Times-interest-earned: 5.0 Current ratio: 1.5 Quick ratio: 1.0 Cash ratio: 0.2 Inventory turnover: 6.3 Receivables collection period: 55.0 days Tax rate = 0.25   Work out the missing entries. For this problem, use the following definitions: Inventory turnover = COGS / average inventory Receivables collection period = average receivables / (sales / 365).

Use the following information for Transylvania Railroad: Long-term debt ratio: 0.4 Times-interest-earned: 5.0 Current ratio: 1.5 Quick ratio: 1.0 Cash ratio: 0.2 Inventory turnover: 6.3 Receivables collection period: 55.0 days Tax rate = 0.25   Work out the missing entries. For this problem, use the following definitions: Inventory turnover = COGS / average inventory Receivables collection period = average receivables / (sales / 365).

FINANCIAL ACCOUNTING
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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Use the following information for Transylvania Railroad:

  • Long-term debt ratio: 0.4
  • Times-interest-earned: 5.0
  • Current ratio: 1.5
  • Quick ratio: 1.0
  • Cash ratio: 0.2
  • Inventory turnover: 6.3
  • Receivables collection period: 55.0 days
  • Tax rate = 0.25

 

Work out the missing entries. For this problem, use the following definitions:

Inventory turnover = COGS / average inventory

Receivables collection period = average receivables / (sales / 365).

(Enter your answers in millions. Do not round intermediate calculations. Round your answers to 2 decimal places.) 

 

### Balance Sheet #### (In millions of dollars) The balance sheet provides a snapshot of the company's financial position at the end of December for the years 2015 and 2014. Below is the detailed financial data represented in the balance sheet. | **Category** | **December 2015** | **December 2014** | |-----------------------|-------------------|-------------------| | **Assets** | | | | Cash | | 32.00 | | Accounts receivable | | 46.80 | | Inventory | | 32.50 | | **Total current assets** | | 111.30 | | Fixed assets (net) | | 122.00 | | **Total Assets** | | 233.30 | | **Liabilities and Equity** | **December 2015** | **December 2014** | |----------------------------|-------------------|-------------------| | Notes payable | | 42.00 | | Accounts payable | | 37.00 | | **Total current liabilities** | | 37.40 | | Long-term debt | | 64.70 | | **Equity** | | 131.20 | | **Total Liabilities and Equity** | | 247.00 | ### Detailed Analysis of the Balance Sheet: 1. **Assets:** - **Cash:** The amount of liquid assets available at hand. In December 2014, the cash available was $32.00 million. - **Accounts Receivable:** The money owed by customers for goods or services that have been delivered but not yet paid for. As of December 2014, it was $46.80 million. - **Inventory:** The value of the company's goods available for sale. In December 2014, inventory was valued at $32.50 million. - **Total Current Assets:** The sum of cash, accounts receivable, and inventory; in December 2014, it amounted to $111.30 million. - **Fixed Assets (net):** The long-term assets of the company, such as machinery, buildings, and equipment, after depreciation. In December 2014, this was $122.00 million. - **Total Assets:** The total of current assets and fixed
Transcribed Image Text:### Balance Sheet #### (In millions of dollars) The balance sheet provides a snapshot of the company's financial position at the end of December for the years 2015 and 2014. Below is the detailed financial data represented in the balance sheet. | **Category** | **December 2015** | **December 2014** | |-----------------------|-------------------|-------------------| | **Assets** | | | | Cash | | 32.00 | | Accounts receivable | | 46.80 | | Inventory | | 32.50 | | **Total current assets** | | 111.30 | | Fixed assets (net) | | 122.00 | | **Total Assets** | | 233.30 | | **Liabilities and Equity** | **December 2015** | **December 2014** | |----------------------------|-------------------|-------------------| | Notes payable | | 42.00 | | Accounts payable | | 37.00 | | **Total current liabilities** | | 37.40 | | Long-term debt | | 64.70 | | **Equity** | | 131.20 | | **Total Liabilities and Equity** | | 247.00 | ### Detailed Analysis of the Balance Sheet: 1. **Assets:** - **Cash:** The amount of liquid assets available at hand. In December 2014, the cash available was $32.00 million. - **Accounts Receivable:** The money owed by customers for goods or services that have been delivered but not yet paid for. As of December 2014, it was $46.80 million. - **Inventory:** The value of the company's goods available for sale. In December 2014, inventory was valued at $32.50 million. - **Total Current Assets:** The sum of cash, accounts receivable, and inventory; in December 2014, it amounted to $111.30 million. - **Fixed Assets (net):** The long-term assets of the company, such as machinery, buildings, and equipment, after depreciation. In December 2014, this was $122.00 million. - **Total Assets:** The total of current assets and fixed
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