Answered: UST Enterprise has 3 items in its…

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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Question

UST Enterprise has 3 items in its current assets section of the balance sheet; cash, AR and inventory. Given is the following information:

Credit sales 75% of total sales Quick ratio 1.25:1

Inventory turnover 5x Average collection period 42 days

Working capital P1,120,000 Working days 360

Current ratio 2:1

What is the amount of inventory?

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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