ACC 205 Week Five Exercise Assignment - 68623

Solution Posted by
tedhuge11

tedhuge11

Rating : (3)A+
Solution Detail
Price: $20.00
  • From: Business,
  • Posted on: Tue 08 Jul, 2014
  • Request id: None
  • Purchased: 0 time(s)
  • Average Rating: No rating
Request Description

1.      Liquidity ratiosEdison, Stagg, and Thornton have the following financial information at the close of business on July 10:

 

 

Edison

Stagg

Thornton

Cash

$6,000

$5,000

$4,000

 

Short-term investments

3,000

2,500

2,000

 

Accounts receivable

2,000

2,500

3,000

 

Inventory

1,000

2,500

4,000

 

Prepaid expenses

800

800

800

 

Accounts payable

200

200

200

 

Notes payable: short-term

3,100

3,100

3,100

 

Accrued payables

300

300

300

 

Long-term liabilities

3,800

3,800

3,800

 

             

 

 

  1. Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?
2.      Computation and evaluation of activity ratiosThe following data relate to Alaska Products, Inc:

Instructions

a.       Compute the accounts receivable and inventory turnover ratios for 20X5. Alaska rounds all calculations to two decimal places.

 

3. Profitability ratios, trading on the equityDigital Relay has both preferred and common stock outstanding. The com­pany reported the following information for 20X7:

 

  1. Compute the profit margin on sales ratio, the return on equity and the return on assets, rounding calculations to two decimal places.
  2. Does the firm have positive or negative financial leverage? Briefly ex­plain.

 

4.      Horizontal analysis. Mary Lynn Corporation has been operating for several years. Selected data from the 20X1 and 20X2 financial statements follow.

a.       Prepare a horizontal analysis for 20X1 and 20X2. Briefly comment on the results of your work.

 

 

5.Vertical analysis. Mary Lynn Corporation has been operating for several years. Selected data from the 20X1 and 20X2 financial statements follow.

 a.       Prepare a vertical analysis for 20X1 and 20X2. Briefly comment on the results of your work.



6. Ratio computationThe financial statements of the Lone Pine Company follow.

Instructions

Compute the following items for Lone Pine Company for 20X2, rounding all calcu­lations to two decimal places when necessary:

a. Quick ratio

b. Current ratio

c. Inventory-turnover ratio

d. Accounts-receivable-turnover ratio

e. Return-on-assets ratio

f. Net-profit-margin ratio

g. Return-on-common-stockholders’ equity

h. Debt-to-total assets

 

i. Number of times that interest is earned 

Solution Description

Attachments
ACC 205 Week Five Exercise Assignment.xlsx
ACC 205 Week Fi...