Question
In: Accounting
The following is a December 31, 2018, post-closing trial balance for Culver City Lighting, Inc. Account...
The following is a December 31, 2018, post-closing trial balance for Culver City Lighting, Inc. Account Title Debits Credits Cash $ 68,000 Accounts receivable 52,000 Inventories 58,000 Prepaid insurance 28,000 Equipment 120,000 Accumulated depreciation—equipment $ 47,000 Patent, net 53,000 Accounts payable 18,500 Interest payable 8,500 Note payable (due in 10, equal annual installments) 140,000 Common stock 83,000 Retained earnings 82,000 Totals $ 379,000 $ 379,000 a. Calculate the current ratio. b. Calculate the acid-test ratio. c. Calculate the debt to equity ratio.
Solutions
Expert Solution
a. Calculations for Current Ratio:-
Current Ratio calculated by Current Assets divided by Current Liabilities.
Current Ratio=(Current Assets/Current Liabilities)
Current Assets=Cash+Accounts Receivable+Inventories+Prepaid Insurance
=$(68,000+52,000+58,000+28,000)
=$206,000
Current Liabilities=Accounts Payable+Interest Payable
=$(18,500+8,500)
=$27,000
Current Ratio=(Current Assets/Current Liabilities)
=(206,000/27,000)
=7.63:1
b. Calculations for Acid - test Ratio:-
Acid - Test Ratio calculated by Quick Assets divided by Current Liabilities.
Acid - Test Ratio=(Quick Assets/Current Liabilities)
Quick Assets= Cash+Accounts Receivable
=$(68,000+52,000)
=$120,000
Acid - Test Ratio=(Quick Assets/Current Liabilities)
=$(120,000/27,000)
=4.44:1
c. Calculations for Debt to Equity Ratio:-
Debt to Equity Ratio calculated by Total Liabilities divided by Stockholders Equity.
Debt to Equity Ratio=(Total Liabilities/Stockholders Equity)
Total Liabilities=Accounts Payable+Interest Payable+Notes Payable
=$(18,500+8,500+140,000)
=$167,000
Stockholders Equity=Common Stock+Retained Earnings
=$(83,000+82,000)
=$165,000
Debt to Equity Ratio=Total Liabilities/ Stockholders Equity
=$(167,000/165,000)
=1.012:1
ekkarill92 answered 4 months agoRelated Solutions
The following is a December 31, 2018, post-closing trial balance for Culver City Lighting, Inc. Account...
The following is a December 31, 2018, post-closing trial balance
for Culver City Lighting, Inc. Account Title Debits Credits Cash
55,000 Accounts receivable 39,000 Inventories 45,000 Prepaid
insurance 15,000 Equipment 100,000 Accumulated
depreciation—equipment 34,000 Patent, net 40,000 Accounts payable
12,000 Interest payable 2,000 Note payable (due in 10, equal annual
installments) 100,000 Common stock 70,000 Retained earnings 76,000
Totals 294,000 294,000
Prepare a classified balance sheet for Culver City Lighting,
Inc. (Amounts to be deducted should be indicated by a...
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 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, 2018, post-closing trial balance for Georgetown, Inc. . Account Title...
The following is a December 31, 2018, post-closing trial balance
for Georgetown, Inc. .
Account Title
Debits
Credits
Cash
$
45,000
Investments
110,000
Accounts receivable
60,000
Inventories
200,000
Prepaid insurance (for the next 9 months)
9,000
Land
90,000
Buildings
420,000
Accumulated depreciation—buildings
$
100,000
Equipment
110,000
Accumulated depreciation—equipment
60,000
Patents (net of amortization)
10,000
Accounts payable
75,000
Notes payable
130,000
Interest payable
20,000
Bonds Payable
240,000
Common stock
300,000
Retained earnings
129,000
Totals
$
1,054,000
$
1,054,000
Additional information:
The...
The following is a December 31, 2018, post-closing trial balance for the Jackson Corporation. Account Title...
The following is a December 31, 2018, post-closing trial balance
for the Jackson Corporation.
Account Title
Debits
Credits
Cash
$
52,000
Accounts receivable
46,000
Inventories
87,000
Prepaid rent for the next 8
months
28,000
Marketable securities (short
term)
22,000
Machinery
205,000
Accumulated
depreciation—machinery
$
23,000
Patent (net of
amortization)
91,000
Accounts payable
14,000
Wages payable
10,000
Taxes payable
44,000
Bonds payable (due in 10
years)
260,000
Common stock
150,000
Retained earnings
30,000
Totals
$
531,000
$
531,000
Required:
Prepare a...
The following is a December 31, 2018, post-closing trial balance for the Jackson Corporation. Account Title...
The following is a December 31, 2018, post-closing trial balance
for the Jackson Corporation.
Account Title
Debits
Credits
Cash
$
52,000
Accounts receivable
46,000
Inventories
87,000
Prepaid rent for the next 8
months
28,000
Marketable securities (short
term)
22,000
Machinery
205,000
Accumulated
depreciation—machinery
$
23,000
Patent (net of
amortization)
91,000
Accounts payable
14,000
Wages payable
10,000
Taxes payable
44,000
Bonds payable (due in 10
years)
260,000
Common stock
150,000
Retained earnings
30,000
Totals
$
531,000
$
531,000
Required:
Prepare a...
The following is a December 31, 2018, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2018, post-closing trial balance
for Almway Corporation.
Account Title
Debits
Credits
Cash
$
45,000
Investments
110,000
Accounts receivable
60,000
Inventories
200,000
Prepaid insurance (for the next
9 months)
9,000
Land
90,000
Buildings
420,000
Accumulated
depreciation—buildings
$
100,000
Equipment
110,000
Accumulated
depreciation—equipment
60,000
Patents (net of
amortization)
10,000
Accounts payable
75,000
Notes payable
130,000
Interest payable
20,000
Bonds Payable
240,000
Common stock
300,000
Retained earnings
129,000
Totals
$
1,054,000
$
1,054,000
Additional information:
The investment...
The following is a December 31, 2018, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2018, post-closing trial balance
for Almway Corporation.
Account Title
Debits
Credits
Cash
$
73,000
Investments
138,000
Accounts receivable
74,000
Inventories
214,000
Prepaid insurance (for the next 9 months)
5,000
Land
118,000
Buildings
434,000
Accumulated depreciation—buildings
$
114,000
Equipment
124,000
Accumulated depreciation—equipment
74,000
Patents (net of amortization)
24,000
Accounts payable
103,000
Notes payable
172,000
Interest payable
34,000
Bonds Payable
254,000
Common stock
342,000
Retained earnings
111,000
Totals
$
1,204,000
$
1,204,000
Additional information:
The investment...
The following is a December 31, 2018, post-closing trial balance for Almway Corporation. Account Title Debits...
The following is a December 31, 2018, post-closing trial balance
for Almway Corporation. Account Title Debits Credits Cash $ 85,000
Investments 150,000 Accounts receivable 80,000 Inventories 220,000
Prepaid insurance (for the next 9 months) 8,000 Land 130,000
Buildings 440,000 Accumulated depreciation—buildings $ 120,000
Equipment 130,000 Accumulated depreciation—equipment 80,000 Patents
(net of amortization) 30,000 Accounts payable 115,000 Notes payable
190,000 Interest payable 40,000 Bonds Payable 260,000 Common stock
360,000 Retained earnings 108,000 Totals $ 1,273,000 $ 1,273,000
Additional information: The investment...
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
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