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Concept Introduction:
Current assets are Assets of the business that are realizable or convertible to cash within a period of one year or less.
Examples of Current assets include Stocks and Inventories, Debtors and Investments made for a period of less than one year.
Inventories refer to the closing balance of stock of raw materials, work in progress and finished goods of a company at the end of a particular reporting period.
Requirement 1:
Inventories reported by Apple on September 30, 2017 and September 24,2016.
Concept Introduction:
Current assets are Assets of the business that are realizable or convertible to cash within a period of one year or less.
Examples of Current assets include Stocks and Inventories, Debtors and Investments made for a period of less than one year.
Inventories refer to the closing balance of stock of raw materials, work in progress and finished goods of a company at the end of a particular reporting period.
Requirement 2:
Inventories reported by Apple on September 30, 2017 and September 24,2016 as a percentage of Current Assets.
Concept Introduction:
Current assets are Assets of the business that are realizable or convertible to cash within a period of one year or less.
Examples of Current assets include Stocks and Inventories, Debtors and Investments made for a period of less than one year.
Inventories refer to the closing balance of stock of raw materials, work in progress and finished goods of a company at the end of a particular reporting period.
Requirement 3:
If Apple would prefer to have inventories as a lower or higher percentage of current assets.
Concept Introduction:
Ratio Analysis:
Ratio analysis is a study of several key metrics of a company based on the data presented in its' financial statements with an objective to evaluate the financial health of a company.
It is essential for investors, stakeholders, government bodies etc. to evaluate the key metrics of an entity in order to ensure that the company fulfills the going concern principle and displays financial stability.
Inventory turnover − A measure of the relation between the turnover and inventory measured in number of times.
It seeks to measure the relation of the inventory rolled over in proportion to the total turnover and is an indicator of how much of the inventory is fast moving in relation to the total turnover.
Days Sale in Inventory − A measure of the total outstanding collections for credit sales in terms of inventory.
It is calculated to understand how many days sales in terms of inventory are available to the company.
Requirement 4:
Inventory Turnover Ratio and Days Sale in Inventory as on 30 September, 2017
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Chapter 6 Solutions
Fundamental Accounting Principles
- $ 36,000 204,000 The Drysdale, Koufax, and Marichal partnership has the following balance sheet immediately prior to liquidation: Cash Noncash assets Liabilities Drysdale, loan $ 50,000 10,000 Total assets $ 240,000 Drysdale, capital (50%) Koufax, capital (30%) Marichal, capital (20%) Total liabilities and capital 70,000 60,000 50,000 $ 240,000 Required: a-1. Determine the maximum loss that can be absorbed in Step 1. Then, assuming that this loss has been incurred, determine the next maximum loss that can be absorbed in Step 2. a-2. Liquidation expenses are estimated to be $15,000. Prepare a predistribution schedule to guide the distribution of cash. b. Assume that assets costing $74,000 are sold for $60,000. How is the available cash to be divided? Complete this question by entering your answers in the tabs below.arrow_forwardCalculate GP ratio round answers to decimal placearrow_forwardWhat is the gross profit percentage for this periodarrow_forward
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- Headland Company pays its office employee payroll weekly. Below is a partial list of employees and their payroll data for August. Because August is their vacation period, vacation pay is also listed. Earnings to Weekly Vacation Pay to Be Employee July 31 Pay Received in August Mark Hamill $5,180 $280 Karen Robbins 4,480 230 $460 Brent Kirk 3,680 190 380 Alec Guinness 8,380 330 Ken Sprouse 8,980 410 820 Assume that the federal income tax withheld is 10% of wages. Union dues withheld are 2% of wages. Vacations are taken the second and third weeks of August by Robbins, Kirk, and Sprouse. The state unemployment tax rate is 2.5% and the federal is 0.8%, both on a $7,000 maximum. The FICA rate is 7.65% on employee and employer on a maximum of $142,800 per employee. In addition, a 1.45% rate is charged both employer and employee for an employee's wages in excess of $142,800. Make the journal entries necessary for each of the four August payrolls. The entries for the payroll and for the…arrow_forwardThe direct materials variance is computed when the materials are purchasedarrow_forwardAction to increase net incomearrow_forward
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