Question 1

Narrative 15-1
For the balance sheet items, indicate the appropriate category:
a.Current Asset
b.Fixed Asset
c.Current Liability
d.Long-Term Liability
e.Owner's Equity
-Refer to Narrative in your text 15-1. Preferred Stock

Accepted Answer

The answer of Narrative 15-1
For the balance sheet items, indicate...

Question 2

Narrative 15-1
For the balance sheet items, indicate the appropriate category:
a.Current Asset
b.Fixed Asset
c.Current Liability
d.Long-Term Liability
e.Owner's Equity
-Refer to Narrative in your text 15-1. Retained Earnings

Accepted Answer

The answer of Narrative 15-1
For the balance sheet items, indicate...

Question 3

Into what category does the following balance sheet item fall: Cash

Accepted Answer

Cash is considered a current asset because it is available to meet short-term obligations or for use in the business's day-to-day operations.

Question 4

Jamie's Natural Foods had net sales of $329,500 and the cost of goods sold were $192,400. Operating expenses were $89,672 and owner's equity is $328,775. Calculate the net profit margin. (Round to the nearest tenth)

Accepted Answer

Net profit margin is calculated as (Net Income / Net Sales) * 100. Net Income is found by subtracting the cost of goods sold and operating expenses from net sales: ($329,500 - $192,400 - $89,672) = $47,428. Thus, the net profit margin is ($47,428 / $329,500) * 100 = 14.4%.

Question 5

Calculate the quick assets and acid test ratios. $\begin{array}{c}
\begin{array}{lll}
\
\
 \text {Company}\
 \text { Chris, Inc: }\
 \text {Alana, Inc. }\
 \text {Eva, Inc.}\
\end{array}
\begin{array}{lll}
\
 \text {Current}\
 \text {liabilities}\
\$ 72,061 \
 \$ 16,154 \
 \$ 822,947 \
\end{array}
\begin{array}{lll}
\
\
 \text {Cash}\
 \$ 25,940 \
 \$ 13,240 \
 \$ 65,800 \
\end{array}
\begin{array}{lll}
\
 \text {Marketable}\
 \text {Securities}\
\$ 20,000 \
 \$ 0 \
\$ 200,000 
\end{array}
\begin{array}{lll}
\ 
\text {Accounts}\
\text {Receivable}\
\$ 36,210 \
 \$ 11,800 \
 \$ 516,000 
\end{array}
\begin{array}{lll}
\
\text {Quick}\
\text {Assets}\
\
\
\
\end{array}
\begin{array}{lll}
\text {Acid}\
\text {Test}\
\text {Ratio}\
\
\
\ 
\end{array}
\end{array}$

Accepted Answer

The answer of Calculate the quick assets and acid test...

Question 6

Calculate the amount of owner's equity and the two leverage ratios: $$\begin{array} { l l l l l l } 
& \text { Total } & \text { Total } & \text { Owner's } & \text { Debt to } & \text { Debt to } \
& \text { Assets } & \text { Equity } \
\text { Company } & \text { Assets } & \text { Liabilities } & \text { Equity } & \text { Ratio } & \text { Ratio } \
\text { Philip Industries } & \$ 316,800 & \$ 110,600 & & &
\end{array}$$

Accepted Answer

The answer of Calculate the amount of owner's equity and...

Question 7

Calculate the missing information based on the format of the income statement: $$\begin{array} { l l l l l } 
& \text { Cost of } & \text { Gross } & \text { Operating } \
\text { Net Sales } & \text { Goods Sold } & \text { Margin } & \text { Expenses } & \text { Net Profit } \
\$ 1,320,500 & & \$ 506,200 & \$ 418,500 &
\end{array}$$

Accepted Answer

The answer of Calculate the missing information based on the...

Question 8

Calculate the average inventory and inventory turnover ratios: $$\begin{array} { l l l l l l } 
& \text { Beginning } & \text { Ending } & \text { Average } & \text { Cost of } & \text { Inventory } \
\text { Company } & \text { Inventory } & \text { Inventory } & \text { Inventory } & \text { Goods Sold } & \text { Turnover } \
\text { Ace Appliances } & \$ 115,800 & \$ 216,800 & & \$ 565,400 &
\end{array}$$

Accepted Answer

The answer of Calculate the average inventory and inventory turnover...

Question 9

Perform a vertical analysis for the entry "Gross Sales" on the portion of an income statement shown below. (Round to the nearest tenth) $$\begin{array} { l l } 
\text { Revenue } & \
\text { Gross Sales } & \$ 320,000 \
\text { Less: Sales returns and Allowances } & 15,000 \
\text { Net Sales } & 305,000 \
\text { Operating Expenses } & \
\text { Salaries and Benefits } & 100,700 \
\text { Rent and Utilities } & 25,400 \
\text { Advertising and Promotions } & 2,380 \
\text { Insurance } & 2,700 \
\text { Miscellaneous Expenses } & 19,395 \
\text { Total Operating Expenses } & \$ 150,575 \
\hline
\end{array}$$

Accepted Answer

Vertical analysis involves expressing each item in the income statement as a percentage of a base figure, typically net sales. Gross Sales is $320,000 and Net Sales is $305,000. The vertical analysis percentage for Gross Sales is calculated as ($320,000 / $305,000) * 100 = 104.9%.

Question 10

Narrative 15-1
For the balance sheet items, indicate the appropriate category:
a.Current Asset
b.Fixed Asset
c.Current Liability
d.Long-Term Liability
e.Owner's Equity
-Refer to Narrative in your text 15-1. R. Smith, Capital

Accepted Answer

The answer of Narrative 15-1
For the balance sheet items, indicate...

Question 11

Calculate the average inventory and inventory turnover ratios: $$\begin{array} { l l l l l l } 
& \text { Beginning } & \text { Ending } & \text { Average } & \text { Cost of } & \text { Inventory } \
\text { Company } & \text { Inventory } & \text { Inventory } & \text { Inventory } & \text { Goods Sold } & \text { Turnover } \
\text { Brock Industries } & \$ 915,500 & \$ 1,616,800 & & \$ 3,300,000 &
\end{array}$$

Accepted Answer

The answer of Calculate the average inventory and inventory turnover...

Question 12

Calculate the value according to the accounting equation: $\begin{array}{lll}
\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \
\$ 659,250 & \$ 212,762 &
\end{array}$

Accepted Answer

The answer of Calculate the value according to the accounting...

Question 13

Calculate the amount of owner's equity and the two leverage ratios: $$\begin{array} { l l l l l l } 
& & & & \text { Debt to } & \text { Debt to } \
& \text { Total } & \text { Total } & \text { Owner's } & \text { Assets } & \text { Equity } \
\text { Company } & \text { Assets } & \text { Liabilities } & \text { Equity } & \text { Ratio } & \text { Ratio } \
\text { Near East Furniture } & \$ 538,200 & \$ 314,500 & & &
\end{array}$$

Accepted Answer

The answer of Calculate the amount of owner's equity and...

Question 14

Find the entry you would make on an income statement for TOTAL OPERATING EXPENSES for the year ended December 31, 2007: Gross Sales, $161,000; Sales Returns and Allowances, $9,600; Sales Discounts, $11,600; Merchandise Inventory, January 1, 2011, $52,500; Merchandise Inventory, December 31, 2011, $62,500; Net Purchases, $82,300; Freight In, $3,000; Salaries, $94,700; Rent, $29,800; Utilities, $2,245; Insurance, $3,250; and Income Tax, $19,600.

Accepted Answer

Total Operating Expenses = Sales Returns and Allowances + Sales Discounts + Cost of Goods Sold + Salaries + Rent + Utilities + Insurance= $9,600 + $11,600 + ($82,300 + $3,000 - $52,500 + $62,500) + $94,700 + $29,800 + $2,245 + $3,250= $129,995

Question 15

Calculate the missing information based on the format of the income statement: $$\begin{array} { l l l l l } 
& \text { Cost of } & \text { Gross } & \text { Operating } & \
\text { Net Sales } & \text { Goods Sold } & \text { Margin } & \text { Expenses } & \text { Net Profit } \
& \$ 118,700 & \$ 312,000 & & \$ 192,500
\end{array}$$

Accepted Answer

The answer of Calculate the missing information based on the...

Question 16

Calculate the average inventory and inventory turnover ratios: $$\begin{array} { l l l l l l } 
& \text { Beginning } & \text { Ending } & \text { Average } & \text { Cost of } & \text { Inventory } \
\text { Company } & \text { Inventory } & \text { Inventory } & \text { Inventory } & \text { Goods Sold } & \text { Turnover } \
\text { Western, Inc. } & \$ 96,500 & \$ 82,200 & & \$ 551,800 &
\end{array}$$

Accepted Answer

The answer of Calculate the average inventory and inventory turnover...

Question 17

Calculate the value according to the accounting equation: $\begin{array}{lll}
\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \
&\$ 550,318 & \$ 914,217 
\end{array}$

Accepted Answer

The answer of Calculate the value according to the accounting...

Question 18

Calculate the missing information based on the format of the income statement: $$\begin{array} { l l l l l } 
& \text { Cost of } & \text { Gross } & \text { Operating } \
\text { Net Sales } & \text { Goods Sold } & \text { Margin } & \text { Expenses } & \text { Net Profit } \
\$ 516,200 & \$ 318,600 & & \$ 143,500 &
\end{array}$$

Accepted Answer

The answer of Calculate the missing information based on the...

Question 19

Calculate the amount of working capital and the current ratio for the following companies: $\begin{array}{c}
\begin{array}{lll}
\
\underline{\text {Company}}\
\text {Smith, Inc.}\
\text {James Trucking}\
\text {Royal Tires, Inc} 
\end{array}
\begin{array}{lll}
\text {Current}\
\underline{\text {Assets}}\
 \$ 615,320 \
\$ 59,600 \
\$ 1,622,500  
\end{array}
\begin{array}{lll}
\text {Current}\
\underline{\text {Liabilities}}\
\$ 215,900 \
\$ 22,000 \
\$ 916,200 \ 
\end{array}
\begin{array}{lll}
\text {Working}\
\underline{\text {Capital}}\
\
\
\ 
\end{array}
\begin{array}{lll}
\text {Current}\
\underline{\text {Ratio }}\
\
\
\
\end{array}
\end{array}$

Accepted Answer

The answer of Calculate the amount of working capital and...

Question 20

Narrative 15-1
For the balance sheet items, indicate the appropriate category:
a.Current Asset
b.Fixed Asset
c.Current Liability
d.Long-Term Liability
e.Owner's Equity
-Refer to Narrative in your text 15-1. Common Stock

Accepted Answer

The answer of Narrative 15-1
For the balance sheet items, indicate...

Quiz 15: Financial Statements and Ratios

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Preferred Stock

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Retained Earnings

Into what category does the following balance sheet item fall: Cash

Jamie's Natural Foods had net sales of $329,500 and the cost of goods sold were $192,400. Operating expenses were $89,672 and owner's equity is $328,775. Calculate the net profit margin. (Round to the nearest tenth)

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. R. Smith, Capital

Calculate the value according to the accounting equation: $\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\\$ 659,250 & \$ 212,762 &\end{array}$

Calculate the value according to the accounting equation: $\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\&\$ 550,318 & \$ 914,217 \end{array}$

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Common Stock

Quiz 15: Financial Statements and Ratios

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Preferred Stock

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Retained Earnings

Into what category does the following balance sheet item fall: Cash

Jamie's Natural Foods had net sales of $329,500 and the cost of goods sold were $192,400. Operating expenses were $89,672 and owner's equity is $328,775. Calculate the net profit margin. (Round to the nearest tenth)

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. R. Smith, Capital

Calculate the value according to the accounting equation: Assets Liabilities Owner’s Equity $659,250$212,762\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\\$ 659,250 & \$ 212,762 &\end{array} Assets $659,250​ Liabilities $212,762​ Owner’s Equity ​

Calculate the value according to the accounting equation: Assets Liabilities Owner’s Equity $550,318$914,217\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\&\$ 550,318 & \$ 914,217 \end{array} Assets ​ Liabilities $550,318​ Owner’s Equity $914,217​

Narrative 15-1 For the balance sheet items, indicate the appropriate category: a.Current Asset b.Fixed Asset c.Current Liability d.Long-Term Liability e.Owner's Equity -Refer to Narrative in your text 15-1. Common Stock

Calculate the value according to the accounting equation: $\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\\$ 659,250 & \$ 212,762 &\end{array}$

Calculate the value according to the accounting equation: $\begin{array}{lll}\text { Assets } & \text { Liabilities } & \text { Owner's Equity } \\&\$ 550,318 & \$ 914,217 \end{array}$