Concept Introduction Current Ratio : Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities. Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities. Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities. Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company. Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity . 1. To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

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Answer 1

Question

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

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Answer 2

Question

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Expert Solution & Answer

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Answer 3

Question

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Expert Solution & Answer

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Answer 4

Question

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Expert Solution & Answer

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Answer 5

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Answer 6

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

Answer 7

Chapter 17, Problem E17.21E

To determine

Concept Introduction

Current Ratio: Current ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its current assets. It is measured as a ratio of current assets to current liabilities.

Cash Ratio: Cash Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with only cash and cash equivalents. It is measured as a ratio of total cash and cash equivalents to current liabilities.

Acid-Test Ratio: Acid-Test Ratio is a financial liquidity ratio that measures the ability of an organization to meet its short-term obligations with its quick assets. The quick assets usually include cash, marketable securities and accounts receivables. It is measured as a ratio of quick assets to current liabilities.

Debt Ratio: Debt ratio is a financial ratio that shows the percentage of total assets that is financed by the total liabilities of a company.

Debt Equity Ratio: Debt Equity Ratio is a financial leverage ratio that shows what proportion of debt an organization is using to finance its assets relative to shareholder’s equity. It is measured as a ratio of total debt to total stockholders’ equity.

1.

To Compute: The given ratios that are current ratio, cash ratio, acid-test ratio, debt ratio and debt to equity ratio for 2016 and 2015.

Answer 8

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Answer 9

To determine

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

Answer 10

Expert Solution & Answer

Answer 11

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Answer 12

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Answer 13

Ch. 17 - Prob. 1QC Ch. 17 - Prob. 2QC Ch. 17 - Prob. 3QC Ch. 17 - Prob. 4QC Ch. 17 - Prob. 5QC Ch. 17 - Prob. 6QC Ch. 17 - Prob. 7QC Ch. 17 - Prob. 8QC Ch. 17 - Prob. 9QC Ch. 17 - Prob. 10QC

2. To Evaluate: The company’s ability to pay its current liabilities and total liabilities.

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Chapter 17 Solutions

2.

To Evaluate: The company’s ability to pay its current liabilities and total liabilities.