Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company. Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company. To Calculate: Gross margin of both the companies.

Question

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Answer 1

Question

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

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Answer 2

Question

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

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Answer 3

Question

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

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Answer 4

Question

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

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Answer 5

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

Answer 6

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

Answer 7

Chapter 3, Problem 2FSA

1.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Gross margin of both the companies.

Answer 8

1.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 21.19%

Year 2ⁿ^d = 22.84%

b. Company 2ⁿ^d => Year 1^s^t = 21.57%

Year 2ⁿ^d = 21.80%

Answer 9

1.

Expert Solution

Answer 10

1.

Expert Solution

Answer 11

Expert Solution

Answer 12

Explanation of Solution

Gross Margin= Net Income/ Net Sales

a. Company 1 st=> Year 1 st= 45687 215639× 100 = 21.19% Year 2 nd=> 53394 233715 × 100= 22.84%b. Company 2 nd=> Year 1 st= 19478 90272 × 100= 21.57% Year 2 nd= 16348 74989× 100= 21.80%

Answer 13

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

Answer 14

2.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of profit margin.

Answer 15

2.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2ⁿ^d is better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t is better than company 2ⁿ^d.

Answer 16

2.

Expert Solution

Answer 17

2.

Expert Solution

Answer 18

Expert Solution

Answer 19

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has gross margin of 21.57% which is slightly better than company 1^s^t 21.19%. So company 2ⁿ^d has better than company 1^s^t.

Year 2ⁿ^d = Company 1^s^t has gross margin of 22.84% which is slightly better than company 2ⁿ^d has 21.80%. So company 1^s^t has better than company 2ⁿ^d.

Answer 20

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

Answer 21

3.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

To Calculate:

Current Ratios of both the companies.

Answer 22

3.

Expert Solution

Answer to Problem 2FSA

a. Company 1^s^t => Year 1^s^t = 1.353

Year 2ⁿ^d = 1.109

b. Company 2ⁿ^d => Year 1^s^t = 6.29

Year 2ⁿ^d = 4.67

Answer 23

3.

Expert Solution

Answer 24

3.

Expert Solution

Answer 25

Expert Solution

Answer 26

Explanation of Solution

Current Ratio= Current Assets Current Liabilities Year 1 st= 106869 79006 = 1.353 Year 2 nd= 89378 80610 = 1.109 Company 2 ndCurrent Ratio= Current Assets Current Liabilities Year 1 st= 105408 16756 = 6.29 Year 2 nd= 90114 19310 = 4.67

Answer 27

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

Answer 28

4.

Summary Introduction

Concept Introduction:

Gross margin is a percentage of profit on sales. It is calculated dividing the profit by the sales. Gross margin tells us the performance of the company.

Current ratio is a ratio of the current assets and the current liabilities. It is calculated dividing the current assets by the current liabilities. It tells about the liquidity of the company.

Company successful on the basis of Current Ratio.

Answer 29

4.

Expert Solution

Answer to Problem 2FSA

Year 1^s^t = Company 2 has better capacity to pay off his short term obligation than company 1.

Year 2ⁿ^d = Company 2 has better capacity to pay off his short term obligation than company 1.

Answer 30

4.

Expert Solution

Answer 31

4.

Expert Solution

Answer 32

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Answer 33

Explanation of Solution

Year 1^s^t = Company 2ⁿ^d has current ratio of 6.29 which is far better than the company 1^s^t of 1.353. So company 2ⁿ^d has better capacity to pay short term obligations.

Year 2ⁿ^d = Company 2ⁿ^d has current ratio of 4.67 which is far better than the company 1^s^t of 1.109. So company 2ⁿ^d has better capacity to pay short term obligations.

Answer 34

Ch. 3 - What is the difference between the cash basis and...Ch. 3 - Why is the accrual basis of accounting generally...Ch. 3 - What type of business is most likely to select a...Ch. 3 - What is a prepaid expense and where is it reported...Ch. 3 - Prob. 5DQ Ch. 3 - What contra account is used when recording...Ch. 3 - Prob. 7DQ Ch. 3 - Prob. 8DQ Ch. 3 - Prob. 9DQ Ch. 3 - Prob. 10DQ

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Answer to Problem 2FSA

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Answer to Problem 2FSA

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Answer to Problem 2FSA

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Answer to Problem 2FSA

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