inventories in order to improve the inventory turnover and to decrease the percentage of inventory to working capital. On the other hand‚ the receivables to working capital is increasing over time and is currently higher than the industry average which will result in collateral problems ; attention from the company is needed for the receivables collection. b. Financial Risk Marine S upply needs to focus on financial risks. After calculating the financial ratios‚ we discovered that some numbers indicate that
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Liquidity Ratio Analysis What It Measures Liquidity ratios are a set of ratios or figures that measure a company’s ability to pay off its short-term debt obligations. This is done by measuring a company’s liquid assets (including those that might easily be converted into cash) against its short-term liabilities. There are a number of different liquidity ratios‚ which each measure slightly different types of assets when calculating the ratio. More conservative measures will exclude assets that
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Attic has the following account balances for the dates given: Cash‚ Sept 1 $40‚000 Cash‚ Sept 30 60‚000 Accounts receivable‚ Sept 1 10‚000 Accounts receivable‚ Sept 30 14‚000 Owner’s equity‚ Sept 1 ? Owner’s equity‚ Sept 30 ? Supplies‚ Sept 1 30‚000 Supplies Sept 30 24‚000 Accounts payable‚ Sept 1 6‚000 Accounts payable‚ Sept 30 ? Net income for September 20‚000 What would owner’s equity be on September 1? 5 points QUESTION 2 1. Annie’s Attic has the following account balances for the dates
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the service‚ their account should be high. So now we want to find an industry that is zero inventories‚ low PP&E‚ high accounts receivable and low long-term debt. See the table 1‚ we find E‚ G and N each has a very high accounts receivable‚ low inventories and PP&E. It shows that they are all service industries. Now we have to look deeply to find the difference among these three industries. First‚ N has an extremely high accounts receivable (90%) and the longest receivables collection period (4
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number. 1. _____ The account‚ Supplies‚ will appear in the following debit columns of the worksheet. a. Trial balance b. Adjusted trial balance c. Balance sheet d. All of these answer choices are correct 2. _____ If Income Summary has a credit balance after revenues and expenses have been closed into it‚ the closing entry for Income Summary will include a a. debit to the owner’s capital account. b. debit to the owner’s drawings account. c. credit to the owner’s capital account. d. credit to the
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goods sold of $20 million. A simplified balance sheet for the firm appears below: THE GREEK CONNECTIONBalance SheetAs of December 31‚ 2012 (in $ thousand) | Assets | Liabilities and Equity | CashAccounts receivableInventory | $ 2‚000 3‚950 1‚300 | Accounts payableNotes payableAccruals | $ 1‚500 1‚000 1‚220 | Total current assets | $ 7‚250 | Total current liabilitiesLong-term debt | $ 3‚720 3‚000 | Net plant‚ property‚and equipment | $ 8‚500 | Total liabilitiesCommon equity | $ 6‚720 9‚030
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analysts‚ potential investors. 2. How will reducing the provision for uncollectible accounts affect the income statement and the balance sheet? Balance Sheet: When the Allowance for Uncollectible Accounts‚ a contra asset account‚ is reported on the balance sheet‚ the company expects that some of its accounts receivable will not be collected. It will debit Bad Debt Expense and credit Allowance for Uncollectible Accounts. This will result in reduction of “Current Assets” on balance sheet. Income Statement:
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25‚636 Notes Payable $ 6‚500 Land 12‚000 Inventory 4‚700 Paid-in Capital 25‚000 Accounts Receivable 2620 Accounts Payable 5‚000 Prepaid Insurance 1‚224 Long Term Debt 9‚000 Retained Earnings 680 Total $ 46‚180 Total $ 46‚180 1. The store purchased and received merchandise for inventory for $5000‚ agreeing to pay within 30 days. = Inventory – 5000‚ Accounts Receivable – 5000 2. Merchandise costing $1‚500 was sold for $2‚300. which was received in Cash
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sheet.) Amount Classification (Circle one.) 12/31/20A Accounts receivable $225‚000 CA CIP > billings $1‚125‚000 CA 12/31/20B Accounts receivable $825‚000 CA Billings > CIP $150‚000 CL 20A 20B Previous billings 0 2‚250‚000 Billings during year 2‚250‚000 6‚000‚000 Cash collected in previous years 0 (2‚025‚000) Cash collected during year (2‚025‚000) (5‚400‚000) Accounts Receivable 225‚000 825‚000 Costs incurred in previous years 0 2‚700‚000
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its regular investment in acquiring fixed assets ➢ Increase in stock /inventory shows piling up of stock with possibility that store is not able to achieve its targeted sales ➢ Increase in Account Receivable shows a increase in debtors for the store ➢ Increase in Account Payable ➢ Acquisition of Lechmere‚ discount retailer of sporting goods & electronic products depicts that company has future expansion plans ➢ Increase in long term borrowing can be assumed
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