FS ANALYSIS - FINANCE 202-FS ANALYSIS 1 When a balance sheet amount is related to an income statement amount in computing a ratio a The balance sheet

FS ANALYSIS - FINANCE 202-FS ANALYSIS 1 When a balance...

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FINANCE 202-FS ANALYSIS 1.When a balance sheet amount is related to an income statement amount in computing a ratio a.The balance sheet amount should be converted to an average for the yearb.The income statement amount should be converted to an average for the yearc.Both amounts should be converted to market valued.Comparisons with industry ratios are not meaningful 2.Windham Company has current assets of P400,000 and current liabilities of P500,000. Windham Company’s current ratio would be increased by 3.Given an acid test ratio of 2.0, current assets of P5,000, and inventory of P2,000, the value of the current liabilities is 4.The ratio of sales to working capital is a measure of 5.The number of day’s sales in receivables is a measure of a.asset valuec. profitabilityb.sales performanced. liquidity 6.A high sales-to-working-capital ratio could indicate 7.Tosh Enterprise reported the following account information:Accounts receivableP400,000Accounts payable160,000Bonds payable, due in 10 years600,000Cash200,000Interest payable, due in 3 months20,000Inventory800,000Land500,000Notes payable, due in 6 months100,000Prepaid expenses80,000The company has a normal operating cycle of 6 monthsThe current ratio for Tosh Enterprise is
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