FINANCIAL+MANAG.ACCT.
9th Edition
ISBN: 9781260728774
Author: Wild
Publisher: RENT MCG
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Question
Chapter 6, Problem 3.3AA
a.
To determine
Vertical Analysis:
In vertical analysis, every line item is represented as a percentage of a base amount which can be either total assets, total liabilities, total equities, etc.
Requirement 1
To compute:
Cash as a percentage of total current assets, total current liabilities, total
b.
To determine
Horizontal Analysis:
In horizontal analysis, a single line item is represented and compared as a percentage change from one base year to the subsequent years.
Requirement 2
To compute:
Percentage change between the beginning and ending cash balances for the current year.
c.
To determine
Days’ sales uncollected:
This ratio defines how fast a company converts its receivable into known amounts of cash. The lesser the ratio is, the better it is for the company as it will prove that the company employs an efficient system of cash collection from customers.
Requirement 3
To compute:
The days’ sales uncollected for both the current and prior year.
d.
To determine
Changes in Days’ sales uncollected:
The changes in the ratio of days’ sales uncollected will greatly impact the liquidity problem of the entity. If it is reduced, the company is considered to be efficiently managing its cash collection mechanism or in case, it is increased, the otherwise will follow.
Requirement 4
Whether S’s receivables collection is showing a favorable or unfavorable change.
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Students have asked these similar questions
A firm’s Balance Sheet and Income Statement for FY 2021 is displayed below and in the in the attached excel file. Answer the following questions.
NOTE: For this question, use the end-of-the year approach (and not the mid-year convention). For example, this means that days receivables = end of FY receivables/daily sales; similarly for the remaining relevant ratios.
You may use the tables below
BALANCE SHEET
2021
Cash and cash equivalents
280
Receivables
2588
Inventory
2516
Other
189
TOTAL CA
5573
Fixed assets
5024
TOTAL ASSETS
10597
Accounts payable
4713
Short term debt
78
TOTAL CL
4790
LT debt
921
Shareh. Equity
4886
TOTAL LIAB. AND SHARH. EQUITY
10597
INCOME STATEMENT
2021
Sales
19418
COGS
13136
Depreciation
354
SG&A
4952
EBIT
976
Interest Expenses
52
Tax
268
Net income
656
Determine the NLF, NSF and the liquidity ratio…
A firm’s Balance Sheet and Income Statement for FY 2021 is displayed below and in the in the attached excel file. Answer the following questions.
NOTE: For this question, use the end-of-the year approach (and not the mid-year convention). For example, this means that days receivables = end of FY receivables/daily sales; similarly for the remaining relevant ratios.
You may use the tables below
BALANCE SHEET
2021
Cash and cash equivalents
280
Receivables
2588
Inventory
2516
Other
189
TOTAL CA
5573
Fixed assets
5024
TOTAL ASSETS
10597
Accounts payable
4713
Short term debt
78
TOTAL CL
4790
LT debt
921
Shareh. Equity
4886
TOTAL LIAB. AND SHARH. EQUITY
10597
INCOME STATEMENT
2021
Sales
19418
COGS
13136
Depreciation
354
SG&A
4952
EBIT
976
Interest Expenses
52
Tax
268
Net income
656
Decompose the return on equity for the FY 2021…
Please answer both a and b thx
Chapter 6 Solutions
FINANCIAL+MANAG.ACCT.
Ch. 6 - Prob. 1QSCh. 6 - Prob. 2QSCh. 6 - Prob. 3QSCh. 6 - Prob. 4QSCh. 6 - Prob. 5QSCh. 6 - Prob. 6QSCh. 6 - Prob. 7QSCh. 6 - Prob. 8QSCh. 6 - Prob. 9QSCh. 6 - Prob. 10QS
Ch. 6 - Prob. 11QSCh. 6 - Prob. 12QSCh. 6 - Prob. 13QSCh. 6 - Prob. 14QSCh. 6 - Prob. 15QSCh. 6 - Prob. 16QSCh. 6 - Prob. 1ECh. 6 - Prob. 2ECh. 6 - Prob. 3ECh. 6 - Prob. 4ECh. 6 - Prob. 5ECh. 6 - Prob. 6ECh. 6 - Prob. 7ECh. 6 - Prob. 8ECh. 6 - Prob. 9ECh. 6 - Prob. 10ECh. 6 - Prob. 11ECh. 6 - Prob. 12ECh. 6 - Prob. 13ECh. 6 - Prob. 14ECh. 6 - Prob. 15ECh. 6 - Prob. 16ECh. 6 - Prob. 17ECh. 6 - Prob. 1PSACh. 6 - Prob. 2PSACh. 6 - Prob. 3PSACh. 6 - Prob. 4PSACh. 6 - Prob. 5PSACh. 6 - Prob. 1PSBCh. 6 - Prob. 2PSBCh. 6 - Prob. 3PSBCh. 6 - Prob. 4PSBCh. 6 - Prob. 5PSBCh. 6 - Prob. 6SPCh. 6 - Prob. 1GLPCh. 6 - Prob. 1.1AACh. 6 - Prob. 1.2AACh. 6 - Prob. 1.3AACh. 6 - Prob. 1.4AACh. 6 - Prob. 1.5AACh. 6 - Prob. 2.1AACh. 6 - Prob. 2.2AACh. 6 - Prob. 3.1AACh. 6 - Prob. 3.2AACh. 6 - Prob. 3.3AACh. 6 - Prob. 3.4AACh. 6 - Prob. 1DQCh. 6 - Prob. 2DQCh. 6 - Prob. 3DQCh. 6 - Prob. 4DQCh. 6 - Prob. 5DQCh. 6 - Prob. 6DQCh. 6 - Prob. 7DQCh. 6 - Prob. 8DQCh. 6 - Prob. 9DQCh. 6 - Prob. 10DQCh. 6 - Prob. 11DQCh. 6 - Prob. 12DQCh. 6 - Prob. 13DQCh. 6 - Prob. 14DQCh. 6 - Harriet Knox, Ralph Patton, and Marcia Diamond...Ch. 6 - Prob. 2BTNCh. 6 - Prob. 3BTNCh. 6 - Prob. 4BTN
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