Question

In: Accounting

Brief Exercise 3-9 (Static) Calculating ratios [LO3-8] The following is a December 31, 2021, post-closing trial...

Brief Exercise 3-9 (Static) Calculating ratios [LO3-8]

The following is a December 31, 2021, post-closing trial balance for Culver City Lighting, Inc.

Account Title Debits Credits
Cash $ 55,000
Accounts receivable 39,000
Inventory 45,000
Prepaid insurance 15,000
Equipment 100,000
Accumulated depreciation $ 34,000
Patent (net) 40,000
Accounts payable 12,000
Interest payable 2,000
Notes payable (due in 10 years) 100,000
Common stock 70,000
Retained earnings 76,000
Totals $ 294,000 $ 294,000

a. Calculate the current ratio.
b. Calculate the acid-test ratio.
c. Calculate the debt to equity ratio.

Solutions

Expert Solution

a. Current ratio = current assets / current liability

= (55000+39000+45000+15000) /(12000+2000)

= 11

b. Acid test ratio = (55000+39000) /(12000+2000)

= 6.71

c. Debt to equity ratio = Debt / equity

= (12000+2000+100000) /(70000+76000)

= 0.78

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Exercise 3-16 (Static) Calculating ratios [LO3-8] The 2021 balance sheet for Hallbrook Industries, Inc., is shown...
Exercise 3-16 (Static) Calculating ratios [LO3-8] The 2021 balance sheet for Hallbrook Industries, Inc., is shown below. HALLBROOK INDUSTRIES, INC. Balance Sheet December 31, 2021 ($ in thousands) Assets Cash $ 200 Short-term investments 150 Accounts receivable 200 Inventory 350 Property, plant, and equipment (net) 1,000 Total assets $ 1,900 Liabilities and Shareholders’ Equity Current liabilities $ 400 Long-term liabilities 350 Paid-in capital 750 Retained earnings 400 Total liabilities and shareholders’ equity $ 1,900 The company’s 2021 income statement reported...
Problem 3-3 Balance sheet preparation [LO3-2, 3-3] The following is a December 31, 2018, post-closing trial...
Problem 3-3 Balance sheet preparation [LO3-2, 3-3] The following is a December 31, 2018, post-closing trial balance for Almway Corporation. Account Title Debits Credits Cash 77,000 Investments 142,000 Accounts Receivable 76,000 Investments 216,000 Prepaid insurance (for the next 9 Months) 6,000 Land 122,000 Buildings 436,000 Accumulated Depreciation-Buildings 116,000 Equipment 126,000 Accumulated Depreciation-Equipment 76,000 Patents (net of amortization) 26,000 Accounts Payable 107,000 Notes Payable 178,000 Interest Payable 36,000 Bonds Payable 256,000 Common Stock 348,000 Retained Earnings 110,000 Totals 1,227,000 1,227,000 Additional...
The following is a December 31, 2021, post-closing trial balance for Culver City Lighting, Inc. Account...
The following is a December 31, 2021, post-closing trial balance for Culver City Lighting, Inc. Account Title Debits Credits Cash $ 65,000 Accounts receivable 49,000 Inventory 55,000 Prepaid insurance 25,000 Equipment 130,000 Accumulated depreciation $ 44,000 Patent (net) 50,000 Accounts payable 17,000 Interest payable 7,000 Notes payable (due in 10 years) 160,000 Common stock 80,000 Retained earnings 66,000 Totals $ 374,000 $ 374,000 a. Calculate the current ratio. b. Calculate the acid-test ratio. c. Calculate the debt to equity ratio....
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits Credits Cash $ 77,000 Investment in equity securities 142,000 Accounts receivable 76,000 Inventory 216,000 Prepaid insurance (for the next 9 months) 6,000 Land 122,000 Buildings 436,000 Accumulated depreciation—buildings $ 116,000 Equipment 126,000 Accumulated depreciation—equipment 76,000 Patent (net) 26,000 Accounts payable 107,000 Notes payable 178,000 Interest payable 36,000 Bonds Payable 256,000 Common stock 348,000 Retained earnings 110,000 Totals $ 1,227,000 $ 1,227,000 Additional information: The...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits Credits Cash $ 53,000 Investment in equity securities 118,000 Accounts receivable 64,000 Inventory 204,000 Prepaid insurance (for the next 9 months) 8,000 Land 98,000 Buildings 424,000 Accumulated depreciation—buildings $ 104,000 Equipment 114,000 Accumulated depreciation—equipment 64,000 Patent (net) 14,000 Accounts payable 83,000 Notes payable 142,000 Interest payable 24,000 Bonds Payable 244,000 Common stock 312,000 Retained earnings 124,000 Totals $ 1,097,000 $ 1,097,000 Additional information: The...
The following is a December 31, 2021, post-closing trial balance for Culver City Lighting, Inc. Account...
The following is a December 31, 2021, post-closing trial balance for Culver City Lighting, Inc. Account Title Debits Credits Cash $ 75,000 Accounts receivable 59,000 Inventory 65,000 Prepaid insurance 35,000 Equipment 160,000 Accumulated depreciation $ 54,000 Patent (net) 60,000 Accounts payable 22,000 Interest payable 12,000 Notes payable (due in 10 years) 210,000 Common stock 90,000 Retained earnings 66,000 Totals $ 454,000 $ 454,000 Prepare a classified balance sheet for Culver City Lighting, Inc. (Amounts to be deducted should be indicated...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits Credits Cash $ 53,000 Investment in equity securities 118,000 Accounts receivable 64,000 Inventory 204,000 Prepaid insurance (for the next 9 months) 8,000 Land 98,000 Buildings 424,000 Accumulated depreciation—buildings $ 104,000 Equipment 114,000 Accumulated depreciation—equipment 64,000 Patent (net) 14,000 Accounts payable 83,000 Notes payable 142,000 Interest payable 24,000 Bonds Payable 244,000 Common stock 312,000 Retained earnings 124,000 Totals $ 1,097,000 $ 1,097,000 Additional information: The...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2021, post-closing trial balance for Almway Corporation. Account Title Debits Credits Cash $ 81,000 Investment in equity securities 146,000 Accounts receivable 78,000 Inventory 218,000 Prepaid insurance (for the next 9 months) 7,000 Land 126,000 Buildings 438,000 Accumulated depreciation—buildings $ 118,000 Equipment 128,000 Accumulated depreciation—equipment 78,000 Patent (net) 28,000 Accounts payable 111,000 Notes payable 184,000 Interest payable 38,000 Bonds Payable 258,000 Common stock 354,000 Retained earnings 109,000 Totals $ 1,250,000 $ 1,250,000 Additional information: The...
The following is a December 31, 2018, post-closing trial balance for the Jackson Corporation.
The following is a December 31, 2018, post-closing trial balance for the Jackson Corporation.Account TitleDebitsCreditsCash$40,000 Accounts receivable34,000 Inventories75,000 Prepaid rent for next 8 months16,000 Marketable securities (short term)10,000 Machinery1,45,000 Accumulated depreciation - machinery 11,000Patent (net of amortization)83,000 accounts payable 8,000wages payable 4,000Taxes payable 32,000Bonds payable (due in 10 Years) 2,00,000Commons stock 1,00,000Retained Earnings 48,000Totals403,000403,000Prepare a classified balance sheet for Jackson Corporation at December 31,2018 
The following is a December 31, 2024, post-closing trial balance for the Jackson Corporation.
The following is a December 31, 2024, post-closing trial balance for the Jackson Corporation.Account TitleDebitsCreditsCash$ 59,000 Accounts receivable53,000 Inventory94,000 Prepaid rent (for the next 8 months)35,000 Investment in equity securities (short term)29,000 Machinery240,000 Accumulated depreciation $ 30,000Patent (net)98,000 Accounts payable 17,500Salaries payable 13,500Income taxes payable 51,000Bonds payable (due in 10 years) 260,000Common stock 170,000Retained earnings 66,000Totals$ 608,000$ 608,000Required:Prepare a classified balance sheet for Jackson Corporation at December 31, 2024, by properly classifying each of the accounts.Note: Amounts to be deducted...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT