
1
Introduction: Percentage representation of cash in terms of current assets and total assets is used to identify the immediate availability of liquidity in the organization. The percentage representation of cash in terms of current liabilities is to identify the immediate pay off of liabilities available in the organization.
To Determine: Percentage that cash represents of current assets, total assets, current liabilities and shareholder equity for each year
1

Answer to Problem 9BTN
Particulars | Current Year | Prior Year |
Cash that represents current assets | 14.6% | 14.7% |
Cash that represents total assets | 7.3% | 7.6% |
Cash that represents current Liabilities | 32.4% | 31.7% |
Cash that represents Shareholders’ Equity | 10.0% | 10.8% |
Explanation of Solution
Computation of percentage that cash represents of current assets, total assets, current liability and shareholders’ equity.
a. Cash that represents current assets =
b. Cash that represents total assets =
c. Cash that represents current liabilities =
d. Cash that represents Shareholders Equity =
Particulars | Current Year | Prior Year |
Cash | ₩16,840,766 | ₩16,284,780 |
Current Assets | ₩115,146,026 | ₩110,760,271 |
Cash that represents current assets |
|
|
Answer | 14.6% | 14.7% |
Total Assets | ₩230,422,958 | ₩214,075,018 |
Cash that represents total assets |
|
|
Answer | 7.3% | 7.6% |
Current Liabilities | ₩52,013,913 | ₩51,315,409 |
Cash that represents current Liabilities |
|
|
Answer | 32.4% | 31.7% |
Shareholders’ Equity | ₩168,088,188 | ₩150,016,010 |
Cash that represents Shareholders’ Equity |
|
|
Answer | 10.0% | 10.8% |
Comment on the trend of the percentage
From the above table, the conclusion can be drawn that there is no major change in the percentage that represents the current assets, total assets, current liabilities and shareholders’ Equity.
2
Introduction: To identify the difference between the cash balance of current and prior year, whether there has been an increase or decrease in the cash balance the percentage is calculated taking the prior year as the base.
To Determine:Percentage change in current and prior year cash balances
2

Answer to Problem 9BTN
Therefore, percentage change in cash balance is 3.4%.
Explanation of Solution
Percentage change in current and prior year cash balances Difference in cash Balance of current and previous year =₩16,840,766-₩16,284,780
= ₩555,986
Percentage change in cash balance =
= 3.4%
3
Introduction: Days of Sales uncollected is calculated to identify the time by
To Determine: Days Sales uncollected at the end of both the current and the prior year.
3

Answer to Problem 9BTN
Days Sales uncollected for current year is 50 days.
Days Sales uncollected of Prior year is 45 days, approx.
Explanation of Solution
Days Sales uncollected at the end of both the current and the prior year.
Days Sales uncollected is calculated by using formula =
Days Sales uncollected for current year =
= 50 days
Days Sales uncollected of Prior year =
= 44.5 days
The day’s sales uncollected has increased by 5.5 days approximately. There has been an increase in accounts receivable but net sales have declined from the previous year. So there has been no improvement in the number of days’ sales uncollected.
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