15. Based on the following data, what is the accounts receivable turnover? Sales
ID: 2587520 • Letter: 1
Question
15. Based on the following data, what is the accounts receivable turnover? Sales on account during year $700,000 Cost of merchandise sold during 270,000 Accounts receivable, beginning of 45,000 Accounts receivable, end of year 35,000 Inventory, beginning of year Inventory, end of year 90,000 110,000 b. 2.6 c. 20.0 d. 15.5 16. Given the following: $ 30,000 35,000 7,000 25,000 40,000 72,000 Accounts payable Accounts receivable Accrued liabilities Cash Intangible assets Inventory Long-term investments100,000 Long-term liabilities Marketable securities Notes payable (short-term) 20,000 Property, plant, and equipment 400,000 Prepaid expenses 75,000 36,000 2,000 Based on the above data, what is the amount of working capital? a. $213,000 b. $113,000 c. $153,000 d. $39,000 17. Based on the above data, what is the quick ratio, rounded to one decimal point? a. b. 2.9 C, d. 1.0 18. Based on data in 10 above, what is the current ratio, rounded to two decimal point? a. 2.35 b. 2.98 c. 4.60 d. 3.56Explanation / Answer
Ans.15
Accounts Receivable Turnover = Net Annual Credit Sales / [(op Accounts Receivable + Cl Accounts Receivable)/2]
= 700000 / [(45000+35000)/2]
=700000/40000
=17.5
Ans.16
Working Capital = Current Assets - Current Liability
Current Assets =(35000+25000+72000+36000+2000) = 170000
Current Liability = (30000+7000+20000) = 57000
Working Capital = 170000 - 57000 = 113000
Ans.17
Quick Ratio = (current Assets-inventory) / Current Liability
= (170000-72000) / 57000
= 98000 / 57000
= 1.7
Ans.18
Current Ratio = Current Assets / Current Liability
= 170000 / 57000
= 2.98
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