Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 16, Problem 6E
The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years:
- a. Determine for each year (1) the
working capital , (2) thecurrent ratio , and (3) the quick ratio. Round ratios to one decimal place. - b. What conclusions can be drawn from these data as to the company’s ability to meet its currently maturing debts?
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
The following data were taken from the balance sheet of Nilo Company at the end of two
recent fiscal years:
Current assets:
Cash
Marketable securities
Accounts and notes receivable (net)
Inventories
Prepaid expenses
Total current assets
Current liabilities:
Accounts and notes payable
(short-term)
Accrued liabilities
Total current liabilities
1. Working capital
2. Current ratio
3. Quick ratio
Current Year
Current
Year
$347,700
402,600
164,700
603,900
311,100
$1,830,000
$353,800
256,200
$610,000
Previous Year
$254,400
286,200
95,400
420,300
268,700
$1,325,000
Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick
ratio. Round ratios to one decimal place.
$371,000
159,000
$530,000
Previous
Year
The condensed financial statements of Ivanhoe Company for the years 2020-2021 are presented below:
(See Images)
Compute the following financial ratios by placing the proper amounts for numerators and denominators. (Round per unit answers to 2 decimal places, e.g. 52.75.)
(a)
Current ratio at 12/31/21
$
$
(b)
Acid test ratio at 12/31/21
$
$
(c)
Accounts receivable turnover in 2021
$
$
(d)
Inventory turnover in 2021
$
$
(e)
Profit margin on sales in 2021
$
$
(f)
Earnings per share in 2021
$
(g)
Return on common stockholders’ equity in 2021
$
$
(h)
Price earnings ratio at 12/31/21
$
$
(i)
Debt to assets at 12/31/21
$
$
(j)
Book value per share at 12/31/21
$
The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years:
Current Year
Previous Year
Current assets:
Cash
Marketable securities
Accounts and notes receivable (net)
Inventories
Prepaid expenses
Total current assets
Current liabilities:
Accounts and notes payable
(short-term)
Accrued liabilities
Total current liabilities.
$620,500
718,500
294,000
749,800
386,200
$2,769,000
1. Working capital
2. Current ratio
3. Quick ratio
b. The liquidity of Albertini has
in current assets relative to current liabilities.
$411,800
298,200
$710,000
$496,000
558,000
186,000
529,500
338,500
$2,108,000
$434,000
186,000
$620,000
a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place.
Current Year
Previous Year
from the preceding year to the current year. The working capital, current ratio, and quick ratio have all
Most of these changes are the result of an
Chapter 16 Solutions
Managerial Accounting
Ch. 16 - Prob. 1DQCh. 16 - What is the advantage of using comparative...Ch. 16 - Prob. 3DQCh. 16 - Prob. 4DQCh. 16 - Prob. 5DQCh. 16 - What do the following data, taken from a...Ch. 16 - Prob. 7DQCh. 16 - Prob. 8DQCh. 16 - The dividend yield of Suburban Propane Partners,...Ch. 16 - Prob. 10DQ
Ch. 16 - Prob. 1BECh. 16 - Prob. 2BECh. 16 - The following items are reported on a companys...Ch. 16 - Prob. 4BECh. 16 - Prob. 5BECh. 16 - Prob. 6BECh. 16 - Prob. 7BECh. 16 - Prob. 8BECh. 16 - Prob. 9BECh. 16 - Prob. 10BECh. 16 - Prob. 11BECh. 16 - Prob. 1ECh. 16 - The following comparative income statement (in...Ch. 16 - Prob. 3ECh. 16 - Prob. 4ECh. 16 - Prob. 5ECh. 16 - The following data were taken from the balance...Ch. 16 - PepsiCo, Inc. (PEP), the parent company of...Ch. 16 - Current position analysis The bond indenture for...Ch. 16 - Prob. 9ECh. 16 - Accounts receivable analysis Xavier Stores Company...Ch. 16 - Prob. 11ECh. 16 - Prob. 12ECh. 16 - Ratio of liabilities to stockholders equity and...Ch. 16 - Hasbro, Inc. (HAS), and Mattel, Inc. (MAT), are...Ch. 16 - Recent balance sheet information for two companies...Ch. 16 - Prob. 16ECh. 16 - Prob. 17ECh. 16 - Prob. 18ECh. 16 - Prob. 19ECh. 16 - Prob. 20ECh. 16 - Prob. 21ECh. 16 - Prob. 22ECh. 16 - Prob. 23ECh. 16 - Prob. 24ECh. 16 - Prob. 25ECh. 16 - Comprehensive income Anson Industries, Inc.,...Ch. 16 - Prob. 1PACh. 16 - Prob. 2PACh. 16 - Prob. 3PACh. 16 - Measures of liquidity, solvency, and profitability...Ch. 16 - Prob. 5PACh. 16 - Prob. 1PBCh. 16 - Prob. 2PBCh. 16 - Prob. 3PBCh. 16 - Prob. 4PBCh. 16 - Prob. 5PBCh. 16 - Prob. 1MADCh. 16 - Prob. 2MADCh. 16 - Deere Company (DE) manufactures and distributes...Ch. 16 - Marriott International, Inc. (MAR), and Hyatt...Ch. 16 - Prob. 1TIFCh. 16 - Real-world annual report The financial statements...Ch. 16 - Prob. 3TIF
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- What do the following data, taken from a comparative balance sheet, indicate about the companys ability to borrow additional long-term debt in the current year as compared to the preceding year?arrow_forwardJuroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Required: Note: Round answers to two decimal places. 1. Calculate the times-interest-earned ratio. 2. Calculate the debt ratio. 3. Calculate the debt-to-equity ratio.arrow_forwardThe following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash Marketable securities Accounts and notes receivable (net) Inventories Prepaid expenses Total current assets Current liabilities: Accounts and notes payable (short-term) Accrued liabilities Total current liabilities 1. Working capital 2. Current ratio $310,100 359,000 146,900 570,200 293,800 $1,680,000 3. Quick ratio $278,400 201,600 $480,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year $ $252,000 283,500 94,500 358,700 229,300 $1,218,000 $294,000 126,000 $420,000arrow_forward
- Loomis, Inc. reported the following on the company’s income statement in two recent years: Please see the image for details: a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place.b. Is this ratio improving or declining?arrow_forward1. Compute the following ratios for the comparative periods (2018 and 2019). The company used 365 days in its computation for some of the ratios. Show your solution. a. Working Capital b. Current Ratio c. Acid Test Ratio d. Accounts Receivable Turnover Ratio e. Average Collection Period f. Inventory Turnover Ratio g. Average Days in Inventory h. Number of days in Operating Cycle i. Debt to Total Assets Ratio j. Debt to Equity Ratio k. Times Interest Earned Ratio l. Gross Profit Ratio m. Profit Margin Ratio n. Return on Assets o. Return on Equity p. Assets Turnover Ratioarrow_forwardRequired: (a) You are required to calculate the following ratios:(iv) Return on Capital Employed(v) Asset turnover(vi) Non-current asset turnover(vii) Current Ratio(viii) Quick Ratio(ix) Inventory days(x) Receivables days(xi) Payable days(xii) Interest cover (b) In light of your calculations comment on the performance of the company over thelast two years.arrow_forward
- REQUIRED Use the information provided below to calculate the ratios for 2021 (expressed to two decimal places) that would reflect each of the following: The time taken by the company to settle its debts with trade The amount of debt that the company uses to finance its The operational effectiveness of the company before considering interest income, interest expense and company tax. The percentage of the profit that has been put back into the What investors are willing to pay for the shares of the company with due consideration given to the profit generated by each share in the company. Comment on the FIVE (5) ratios of Oslo Limited as compared to the industry average provided in the additional information. INFORMATION The information given below was extracted from the books of Oslo Limited:…arrow_forwardWhat do the following data, taken from a comparative balance sheet, indicate about the company’s ability to borrow additional long-term debt in thecurrent year as compared to the preceding year? Current Year Preceding YearFixed assets (net) $1,260,000 $1,360,000Total long-term liabilities 300,000 400,000arrow_forwardCalculate the following five ratios for each of the two years:(i) Return on capital employed(ii) Net profit margin(iii) Current ratio(iv) Average Receivable days/ Debtors collection period(v) Average Payable days/ Creditors collection periodarrow_forward
- 1. Compute the following ratios for the comparative periods (2018 and 2019). The company used 365 days in its computation for some of the ratios. Show your solution. d. Accounts Receivable Turnover Ratio e. Average Collection Period f. Inventory Turnover Ratio g. Average Days in Inventory h. Number of days in Operating Cycle i. Debt to Total Assets Ratio j. Debt to Equity Ratio k. Times Interest Earned Ratio l. Gross Profit Ratio m. Profit Margin Ratio n. Return on Assets o. Return on Equity p. Assets Turnover Ratioarrow_forwardThe comparative accounts payable and long-term debt balances for a company follow. Current Year Previous YearAccounts payable $114,240 $102,000Long-term debt 127,200 120,000 Based on this information, what is the amount and percentage of increase or decrease that wouldbe shown on a balance sheet with horizontal analysis?arrow_forwardWhich of the following items we appear as current liabilities in a company’s statement of financial position? a. Loan due for repayment within one year, trade payables, drawings b. Loan due for repayment within one year, trade payables, accruals c. Loan due for repayment within one year, trade payables and trade receivables d. Loan due for repayment within one year, trade payables and capitalarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Financial ratio analysis; Author: The Finance Storyteller;https://www.youtube.com/watch?v=MTq7HuvoGck;License: Standard Youtube License