Chapter 9, Problem 15E

LO 13-2, 13-3, 13-4, 13-5 Exercise 13-15A Comprehensive analysis

Required

Indicate the effect of each of the following transactions on (1) the current ratio, (2) working capital, (3) stockholders’ equity, (4) book value per share of common stock, and (5) retained earnings. Assume that the current ratio is greater than 1:1.

1. a. Collected account receivable.
2. b. Wrote off account receivable.
3. c. Converted a short-term note payable to a long-term note payable.
4. d. Purchased inventory on account.
5. e. Declared cash dividend.
6. f. Sold merchandise on account at a profit.
7. g. Issued stock dividend.
8. h. Paid account payable.
9. i. Sold building at a loss.