Calculate Current ratio .

Question

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Answer 1

Question

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

1 b.

To determine

Compute cash ratio.

1 c.

To determine

Compute acid test ratio.

1 d.

To determine

Compute the inventory turnover ratio.

1 e.

To determine

Compute the days’ inventory ratio.

1 f.

To determine

Compute Days’ sales in receivables.

1 g.

To determine

Compute the days’ inventory ratio.

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Recently, Abercrombie & Fitch has been implementing a turnaround strategy since its sales had been falling for the past few years (11% decrease in 2014, 8% in 2015, and just 3% in 2016.) One part of Abercrombie's new strategy has been to abandon its logo-adorned merchandise, replacing it with a subtler look. Abercrombie wrote down $20.6 million of inventory, including logo-adorned merchandise, during the year ending January 30, 2016. Some of this inventory dated back to late 2013. The write-down was net of the amount it would be able to recover selling the inventory at a discount. The write-down is significant; Abercrombie's reported net income after this write-down was $35.6 million. Interestingly, Abercrombie excluded the inventory write-down from its non-GAAP income measures presented to investors; GAAP earnings were also included in the same report. Question: What impact would the write-down of inventory have had on Abercrombie's expenses, Gross margin, and Net income?

Recently, Abercrombie & Fitch has been implementing a turnaround strategy since its sales had been falling for the past few years (11% decrease in 2014, 8% in 2015, and just 3% in 2016.) One part of Abercrombie's new strategy has been to abandon its logo-adorned merchandise, replacing it with a subtler look. Abercrombie wrote down $20.6 million of inventory, including logo-adorned merchandise, during the year ending January 30, 2016. Some of this inventory dated back to late 2013. The write-down was net of the amount it would be able to recover selling the inventory at a discount. The write-down is significant; Abercrombie's reported net income after this write-down was $35.6 million. Interestingly, Abercrombie excluded the inventory write-down from its non-GAAP income measures presented to investors; GAAP earnings were also included in the same report. Question: What impact would the write-down of inventory have had on Abercrombie's assets, Liabilities, and Equity?

Answer 2

Question

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

1 b.

To determine

Compute cash ratio.

1 c.

To determine

Compute acid test ratio.

1 d.

To determine

Compute the inventory turnover ratio.

1 e.

To determine

Compute the days’ inventory ratio.

1 f.

To determine

Compute Days’ sales in receivables.

1 g.

To determine

Compute the days’ inventory ratio.

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Answer 3

Question

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

1 b.

To determine

Compute cash ratio.

1 c.

To determine

Compute acid test ratio.

1 d.

To determine

Compute the inventory turnover ratio.

1 e.

To determine

Compute the days’ inventory ratio.

1 f.

To determine

Compute Days’ sales in receivables.

1 g.

To determine

Compute the days’ inventory ratio.

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Answer 4

Question

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

1 b.

To determine

Compute cash ratio.

1 c.

To determine

Compute acid test ratio.

1 d.

To determine

Compute the inventory turnover ratio.

1 e.

To determine

Compute the days’ inventory ratio.

1 f.

To determine

Compute Days’ sales in receivables.

1 g.

To determine

Compute the days’ inventory ratio.

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Answer 5

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

1 b.

To determine

Compute cash ratio.

1 c.

To determine

Compute acid test ratio.

1 d.

To determine

Compute the inventory turnover ratio.

1 e.

To determine

Compute the days’ inventory ratio.

1 f.

To determine

Compute Days’ sales in receivables.

1 g.

To determine

Compute the days’ inventory ratio.

Answer 6

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

Answer 7

Chapter D, Problem 18E

1 a.

To determine

Calculate Current ratio.

Answer 8

1 b.

To determine

Compute cash ratio.

Answer 9

1 b.

To determine

Compute cash ratio.

Answer 10

1 c.

To determine

Compute acid test ratio.

Answer 11

1 c.

To determine

Compute acid test ratio.

Answer 12

1 d.

To determine

Compute the inventory turnover ratio.

Answer 13

1 d.

To determine

Compute the inventory turnover ratio.

Answer 14

1 e.

To determine

Compute the days’ inventory ratio.

Answer 15

1 e.

To determine

Compute the days’ inventory ratio.

Answer 16

1 f.

To determine

Compute Days’ sales in receivables.

Answer 17

1 f.

To determine

Compute Days’ sales in receivables.

Answer 18

1 g.

To determine

Compute the days’ inventory ratio.

Answer 19

1 g.

To determine

Compute the days’ inventory ratio.

Answer 20

Expert Solution & Answer

Answer 21

Expert Solution & Answer

Answer 22

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Answer 23

Ch. D - Prob. 1TI Ch. D - Prob. 2TI Ch. D - Prob. 3TI Ch. D - Prob. 4TI Ch. D - Prob. 5TI Ch. D - Prob. 6TI Ch. D - Prob. 7TI Ch. D - Prob. 8TI Ch. D - Prob. 9TI Ch. D - Prob. 10TI

Calculate Current ratio .

Solution Summary: The author explains how to calculate the current ratio by dividing quick assets and current liabilities.

Videos

Calculate Current ratio.

Compute cash ratio.

Compute acid test ratio.

Compute the inventory turnover ratio.

Compute the days’ inventory ratio.

Compute Days’ sales in receivables.

Compute the days’ inventory ratio.

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Chapter D Solutions