Customer Service Chat
Get quote & make Payment
Project, Basic Statistics
The trial balance of the Parton Wholesale Company contained the following accounts at December 31, 2010 the end of the company’s calendar year.
PARTON WHOLESALE COMPANY
Cash $ 34,400
Accounts Receivable 36,600
Merchandise Inventory (Beginning) 62,400
Accumulated Depreciation-Buildings $ 54,000
Accumulated Depreciation-Equipment 42,400
Notes Payable 50,000
Accounts Payable 37,500
Common Stock 200,000
Retained Earnings 67,800
Sales Discounts 4,600
Purchase Discounts 16,000
Salaries Expense 69,800
Utilities Expense 9,400
Repair Expense 5,900
Gas and Oil Expense 7,200
Insurance Expense 3,500
$ 1,353,800 $ 1,353,800
Depreciation is $10,000 on buildings and $9,000 on equipment. (Both are administrative expenses.)
Interest of $7,000 is unpaid on notes payable at December 31.
Merchandise inventory on hand at December 31, 2010 is $90,000.
Salaries are 80% selling and 20% administrative.
Utilities expense, repair expense, and insurance expense are 100% administrative.
$15,000 of the notes payable are payable next year.
Gas and oil expense is a selling expense.
The beginning balance of accounts receivable is $34,750.
The amount of total assets at the beginning of the year is $469,225.
Journalize the adjusting entries.
Prepare a multiple-step income statement and a retained earnings statement for the year ended, as well as a classified balance sheet as of December 31, 2010.
Prepare the following ratios and show all support for your computations:
a) Current Ratio
b) Quick Ratio
c) Working Capital
d) Accounts Receivable Turnover
e) Average Collection Period
f) Inventory Turnover
g) Days in Inventory
h) Debt to Total Assets Ratio
i) Gross Profit Ratio
j) Profit Margin Ratio
k) Return on Assets Ratio
l) Asset Turnover Ratio
4) Based on the ratios computed in 3) above, answer the following questions and use the financial statement ratios to support your answers where appropriate:
Do you feel that the company is able to meet its current and long term obligations as they become due?
Comment on the profitability of the company with respect to the various profitability ratios that you computed.
Would you lend money to this company for the long term?
Comment on the ability of the company to collect its receivables and mange inventory.
2007 2008 2009 Industry Average
Current 2.39 2.68 2.90 3.12
Quick 1.10 1.16 1.21 1.56
Working Capital $ 98,750.00 $ 100,450.00 $ 103,000.00 $ 110,000.00
Debt to Total Assets (%) 20.97% 21.98% 22.89% 20.89%
Times Interest Earned 8.75 9.12 9.56 10.22
Inventory Turnover (sales) 8.21 9.91 10.12 10.52
Fixed Asset Turnover 3.43 3.51 3.59 3.64
Total Asset Turnover 2.15 2.20 2.25 2.56
Average Collection Period (days) 14.95 14.69 14.42 14.28
Accounts Receivable Turnover 24.08 24.50 24.97 25.21
Days in Inventory 44.46 36.83 36.07 43.21
Gross Profit Margin (%) 21.10% 22.50% 24.03% 24.56%
Net Profit (%) 6.89% 7.25% 7.89% 8.03%
Return on Total Assets (%) 15.50% 16.10% 16.24% 16.07%
Return on Equity (%) 20.15% 21.89% 22.15% 22.06%
Payout Ratio (%) 15.10% 15.84% 16.09% 16.86%
Posted Date: 4/17/2012 7:54:36 PM | Location : United States
Ask an Expert
Project, Assignment Help, Ask Question on Project, Get Answer, Expert's Help, Project Discussions
Write discussion on Project
Your posts are moderated
Write your message here..
Moderate negative correlation, I want as much information about moderate ne...
I want as much information about moderate negative correlation.
Calculate the mean absolute percentage error, Littlefield Laboratories is a...
Littlefield Laboratories is a state-of-the-art highly automated blood samples testing lab. The demand of blood sample testing for the previous 20 days (day 1 to day 20) are given i
Scale of measurement , which scale of measurement is used for Class size
which scale of measurement is used for Class size
Karl Pearsons, ). Calculate Karl Pearson’s coefficient of correlation from...
). Calculate Karl Pearson’s coefficient of correlation from the following data , using 20 as the working mean for price and 70 as the working mean for demand: Price: 14 16 17 18 1
Analysis and interpretation business report, Case Study. Using the data, pr...
Case Study. Using the data, prepare a report that analyses the profitability, liquidity and solvency of a Accessorize Pty Ltd and help the owner to decided whether to purchase the
Biostatistics, when testing hypothesis is the level of significanc the type...
when testing hypothesis is the level of significanc the type error I?
Perform multiple regression, You have collected data on 4 continuous variab...
You have collected data on 4 continuous variables (diastolic BP, age, weight, and average number of minute of exercise per week)you think may be related to total cholesterol levels
Hierarchical clustering , Hierarchical Clustering Five, two-dimens...
Hierarchical Clustering Five, two-dimensional data points are shown below: x y -0.43 1.19 -1.66 1.1
Cosumer behaviour, consumer behaviour in accounting
consumer behaviour in accounting
Accounting Assignment Help
Economics Assignment Help
Finance Assignment Help
Statistics Assignment Help
Physics Assignment Help
Chemistry Assignment Help
Math Assignment Help
Biology Assignment Help
English Assignment Help
Management Assignment Help
Engineering Assignment Help
Programming Assignment Help
Computer Science Assignment Help
Why Us ?
~24x7 hrs Support
~Quality of Work
~Time on Delivery
~Privacy of Work
Human Resource Management
Literature Review Writing Help
Follow Us |
T & C
Copyright by ExpertsMind IT Educational Pvt. Ltd.