FINANCIAL ACCOUNTING:TOOLS FOR BUSINESS
19th Edition
ISBN: 9781119493624
Author: Kimmel
Publisher: WILEY
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The following table shows an abbreviated income statement and balance sheet for Quick Burger Corporation for 2016.
INCOME STATEMENT OF QUICK BURGER CORP., 2016
(Figures in $ millions)
Net sales
Costs
Depreciation
Earnings before interest and taxes (EBIT)
Interest expense
Pretax income
Taxes
Net income
Assets
Current assets
Cash and marketable securities
Receivables
Inventories
Other current assets
Total current assets.
Fixed assets
Property, plant, and equipment
Intangible assets (goodwill)
Other long-term assets
Total assets
2016
BALANCE SHEET OF QUICK BURGER CORP., 2016
(Figures in $ millions)
2,340
1,379
126
1,093
4,938
$ 27,571
17,573
1,406
$ 8,592
24,681
2,808
2,987
35,414
521
8,071
2,825
$ 5,246
2015 Liabilities and Shareholders' Equity
Current liabilities
Debt due for repayment
Accounts payable
Total current liabilities
2,340
1,339
121
620
4,420
Long-term debt
22,839 Other long-term liabilities
2,657 Total liabilities
3,103 Total shareholders' equity
33,019
Total liabilities and…
Required:
1. Calculate the following risk ratios for 2024:
2. When we compare two companies, can one have a higher current ratio while the other has a higher acid-test ratio?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Calculate the following risk ratios for 2024: (Round your answers to 1 decimal place.)
Risk Ratios
a. Receivables turnover ratio
b. Inventory turnover ratio
c. Current ratio
d. Acid-test ratio
e. Debt to equity ratio
times
times
%
Required 1
Required 2 >
The balance sheets for Monitor World Corporation and additional information are provided below.
MONITOR WORLD CORPORATION
Balance Sheets
December 31, 2024 and 2023
Assets
Current assets:
Cash
Accounts receivable
Inventory
Investments
Long-term assets:
Land
Equipment
Less: Accumulated depreciation
Total assets
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
Interest payable
Income tax payable
Long-term liabilities:
Notes payable
Stockholders' equity:
Common stock
Retained earnings
Total liabilities and stockholders' equity
Additional information for 2024:
1. Net income is $128,400.
2. Sales on account are $1,702,000.
3. Cost of goods sold is $1,276,500.
Complete this question by entering your answers in the tabs below.
a. Receivables turnover ratio
b. Inventory turnover ratio
c. Current ratio
d. Acid-test ratio
e. Debt to equity ratio
2024
times
times
$176,400
88,000
100,000
4,500
%
Required:
1. Calculate the following risk ratios for 2024:
2. When we compare…
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