073Q3Elearning - statement accounts are unaffected by these...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Name___ Zhi Pei ________________4-Digit # 7688 __ Section_ 14518 _ Financial Statement Ratios: [073Q3Elearning] The Andrew Company’s current assets were $47,000 at the end of Year 2. Current assets include Cash of $26,000, Accounts Receivable of $7,000 and Inventory of $14,000. Andrew’s non-current assets were $69,000 at the end of Year 2. Non-current assets included Property, Plant & Equipment [PPE] of $52,000 and Investments for $17,000. Andrew’s Net Income for Year 2 was $6,200. Sales for Year 2 were $15,100 and total expenses in the year had been $8,900. Included in those total expenses were tax expense was $2,200, Interest Expense $1,700, Depreciation Expense was $2,900 and Amortization Expense had been $2,100. At the end of Year 2, Andrew’s current liabilities were $39,000 and Andrew’s non- current liabilities were $60,000. Requirement: On January 1, Year 3, the firm borrowed $8,000 by signing a short-term note payable and purchased a machine [PPE] costing $9,000 [PPE] for cash. All income
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: statement accounts are unaffected by these transactions. ●___ 97.87 % What was the firm’s current ratio in Year 3 immediately after this transaction on January 1, Year 3? ●___ 121.8 __ % What is the firm’s asset turnover for Year 3 assuming Year 3 Sales are the same as in Year 2? Also assume that the firm’s assets at the end of Year 3 are same as at the end of Year 2 except for the impacts of the transaction occurring on January 1, Year 3. Requirement: Instead of the facts in the transaction occurring on January 1, Year 3, assume the firm borrowed $8,000 by creating a long-term liability and received cash in that amount. This transaction occurred on January 1, Year 3. Determine the proper values for the ratios below immediately after this January 1, Year 3 transaction occurred. ●__ 141 % What was the firm’s current ratio ? ●$_16,000 _ How much working capital does this firm have immediately after the transaction on January 1, Year 3 as described....
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern