Romney\'s Marketing Company has the following adjusted trial balance at the end
ID: 2413822 • Letter: R
Question
Romney's Marketing Company has the following adjusted trial balance at the end of the current year. No dividends were declared. However, 500 shares ($0.10 par value per share) issued at the end of the year for $3,000 are included below: Debit Credit Cash Accounts receivable Interest receivable Prepaid insurance Notes receivable (ong-term) Equipment Accumulated depreciation Accounts payable Accrued expenses payable Income taxes payable Unearned rent revenue Common Stock (800 shares) Additional paid-in capital Retained earnings Sales revenue Interest revenue Rent revenue Wages expense Depreciation expense Utilities expense Insurance expense Rent expense Income tax expense Total S 1,500 2,200 100 1,600 2,800 15,290 $ 3,000 2,400 3,920 2,700 500 80 3,620 2,000 38,500 100 800 19,500 1,800 380 750 9,000 2,700 S 57,620 57,620 a. Compute total assets for Romney's Marketing Company based on the adjusted trial balance. Total assets b. Compute the company's total asset turnover for the current year, assuming total assets at the end of the prior year were $16,050 Total Asset Turnover Choose Numerator: Choose Denominator: Total Asset Turnover Total asset turnoverExplanation / Answer
a. Total Assets $ 20,490 b. Total Asset turnover Choose Numerator / Choose Denominator = Total Asset Turnover Sales Revenue / Average Total Assets = Total Asset Turnover $ 38,500 / 18,270 = 2.11 Working: Total Assets Working: Cash $ 1,500 Accounts Receivable 2,200 Interest Receivable 100 Prepaid Insurance 1,600 Notes Receivable(long-term) 2,800 Equipment 15290 Less:Accumulated Depreciation 3000 12,290 Total Assets at the end of current year a 20,490 Total Assets at the end of last year b 16,050 Average Assets (a+b)/2 18,270
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