Answer the following questions: Question G A firm has the following balance shee
ID: 2616450 • Letter: A
Question
Answer the following questions:
Question G
A firm has the following balance sheet as June 14, 2018. What is its current ratio?
Cash
$10,000
Inventory
$25,000
Prepaid Expenses
$10,000
Property, Plant, and Equipment
$100,000
Goodwill
$25,000
Total Assets
$170,000
Accounts Payable
$5,000
Accruals
$15,000
Current Portion of Long Term Bonds Payable
$25,000
Long Term Bonds Payable
$50,000
Common Stock, Par
$1,000
Common Stock, Paid in Capital
$50,000
Retained Earnings
$24,000
Total Liabilities and Equity
$170,000
Question H
Using the information below, calculate the 2018 Operating Cash Flow.
2018
2017
Cash
$ 10,000.00
$ 8,000.00
Inventory
$ 25,000.00
$ 5,000.00
Prepaid Expenses
$ 10,000.00
$ 5,000.00
Property, Plant, and Equipment
$ 100,000.00
$ 110,000.00
Goodwill
$ 25,000.00
$ 25,000.00
Total Assets
$ 170,000.00
$ 153,000.00
Accounts Payable
$ 5,000.00
$ 10,000.00
Accruals
$ 15,000.00
$ 8,500.00
Current Portion of Long Term Bonds Payable
$ 25,000.00
$ 7,000.00
Long Term Bonds Payable
$ 50,000.00
$ 60,000.00
Common Stock, Par
$ 1,000.00
$ 1,000.00
Common Stock, Paid in Capital
$ 50,000.00
$ 50,000.00
Retained Earnings
$ 24,000.00
$ 16,500.00
Total Liabilities and Equity
$ 170,000.00
$ 153,000.00
Sales
$ 100,000.00
$ 90,000.00
COGS
$ 25,000.00
$ 20,000.00
Gross Profit
$ 75,000.00
$ 70,000.00
Depreciation
$ 20,000.00
$ 18,000.00
EBIT
$ 55,000.00
$ 52,000.00
Interest
$ 5,000.00
$ 10,000.00
EBT
$ 60,000.00
$ 42,000.00
Taxes
$ 12,600.00
$ 8,820.00
NI
$ 47,400.00
$ 33,180.00
Question I
A firm's ROE has increased from 2017 to 2018. Using the information below, identify the ROE component that is responsible for the increase.
2018
2017
Cash
$ 10,000.00
$ 8,000.00
Inventory
$ 25,000.00
$ 5,000.00
Prepaid Expenses
$ 10,000.00
$ 5,000.00
Property, Plant, and Equipment
$ 100,000.00
$ 110,000.00
Goodwill
$ 25,000.00
$ 25,000.00
Total Assets
$ 170,000.00
$ 153,000.00
Accounts Payable
$ 5,000.00
$ 10,000.00
Accruals
$ 15,000.00
$ 8,500.00
Current Portion of Long Term Bonds Payable
$ 25,000.00
$ 7,000.00
Long Term Bonds Payable
$ 50,000.00
$ 60,000.00
Common Stock, Par
$ 1,000.00
$ 1,000.00
Common Stock, Paid in Capital
$ 50,000.00
$ 50,000.00
Retained Earnings
$ 24,000.00
$ 16,500.00
Total Liabilities and Equity
$ 170,000.00
$ 153,000.00
Sales
$ 100,000.00
$ 90,000.00
COGS
$ 25,000.00
$ 20,000.00
Gross Profit
$ 75,000.00
$ 70,000.00
Depreciation
$ 20,000.00
$ 18,000.00
EBIT
$ 55,000.00
$ 52,000.00
Interest
$ 5,000.00
$ 10,000.00
EBT
$ 60,000.00
$ 42,000.00
Taxes
$ 12,600.00
$ 8,820.00
NI
$ 47,400.00
$ 33,180.00
Question J
A firm has a ROA of 10% and a debt ratio of 75%. The firm has sales of $50,000 and net income of $10,000. How much equity does the firm have?
Cash
$10,000
Inventory
$25,000
Prepaid Expenses
$10,000
Property, Plant, and Equipment
$100,000
Goodwill
$25,000
Total Assets
$170,000
Accounts Payable
$5,000
Accruals
$15,000
Current Portion of Long Term Bonds Payable
$25,000
Long Term Bonds Payable
$50,000
Common Stock, Par
$1,000
Common Stock, Paid in Capital
$50,000
Retained Earnings
$24,000
Total Liabilities and Equity
$170,000
Explanation / Answer
All the questions are independent to each other so i will solve one of them
G) Current ratio=current assets/current liabilites
=(cash+inventory+prepaid exp)/(account payable+accruals+current portion of lt debt)
=(10000+25000+10000)/(5000+15000+25000)
=1.00
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