Corporate Financial Accounting
15th Edition
ISBN: 9781337398169
Author: Carl Warren, Jeff Jones
Publisher: Cengage Learning
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Textbook Question
Chapter 5, Problem 5.2MAD
Analyze Dollar General
Dollar General Corporation (DG) is a discount retailer with more than 12,000 stores. It offer a wide range of merchandise normally for $10 or less. The following data (in millions) were taken from recent financial statements of Dollar General:
Year 2 | Year 1 | |
Total sales | $21,987 | $20,369 |
Total assets: | ||
Beginning of year | 11,258 | 11,209 |
End of year | 11,672 | 11,258 |
a. Compute the asset turnover ratio for Year 2 and Year 1. Round to two decimal places.
b. Interpret the change in the asset turnover ratio from Year 1 to Year 2.
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Assume a merchandising company had credit sales of $380,000, cost of goods sold of $187,000, and net income of $60,000. It provided the following excerpts from its balance sheet:
This Year
Last Year
Current assets:
Accounts receivable
$ 40,000
$ 46,000
Inventory
$ 53,000
$ 50,000
Prepaid expenses
$ 13,000
$ 11,000
Current liabilities:
Accounts payable
$ 39,000
$ 44,000
Income taxes payable
$ 13,000
$ 10,000
If the company purchases its merchandise inventory on account, then based solely on the information provided, the company’s cash paid for inventory purchases would be:
Garrison 17e Rechecks 2020-10-02
Multiple Choice
$189,000.
$185,000.
$195,000.
$179,000.
Complete the balance sheet and sales information using the following financial data
Total assets turnover: 1.5 X
Days sales outstanding: 36.5 days (Calculation is based on a 365-day year)
Inventory turnover ratio: 5 X
Fixed assets turnover: 3.0 X
Current ratio: 2.0 X
Gross profit margin on sales: (Sales - Cost of goods sold) ∕ Sales = 25%
Cash
------------
Current Liabilities
--------
Accounts Receivables
------------
Long Term Liabilities
60000
Inventories
------------
Common Stock
--------
Fixed Assets
------------
Retained Earnings
97500
Total Assets
300000
Total Liabilities and Equity
---------
Sales
Cost of goods sold
---------
Interpret the current ratio, total assets turnover ratio, inventory turnover ratio and profit margin on sales.
Balance Sheet Analysis
Complete the balance sheet and sales information in the table that follows for J. White Industries using the following financial data:
Total assets turnover: 1.3Gross profit margin on sales: (Sales - Cost of goods sold)/Sales = 20%Total liabilities-to-assets ratio: 45%Quick ratio: 0.90Days' sales outstanding (based on 365-day year): 36.5 daysInventory turnover ratio: 3.50
Do not round intermediate calculations. Round your answers to the nearest whole dollar.
Partial Income Statement Information
Sales?
Cost of goods sold?
Balance Sheet
Chapter 5 Solutions
Corporate Financial Accounting
Ch. 5 - Prob. 1DQCh. 5 - Prob. 2DQCh. 5 - The credit period during which the buyer of...Ch. 5 - What is the meaning of (A) 1/15, n/60; (B) n/30;...Ch. 5 - Prob. 5DQCh. 5 - Prob. 6DQCh. 5 - Who is responsible for freight when the terms of...Ch. 5 - Name three accounts that would normally appear in...Ch. 5 - Audio Outfitter Inc., which uses a perpetual...Ch. 5 - Assume that Audio Outfitter Inc. in Discussion...
Ch. 5 - Gross profit During the current year, merchandise...Ch. 5 - Purchases transactions Elkhorn Company purchased...Ch. 5 - Prob. 5.3BECh. 5 - Prob. 5.4BECh. 5 - Transactions for buyer and seller Shore Co. sold...Ch. 5 - Adjusting entries Halm Flooring Company uses a...Ch. 5 - Asset turnover ratio Financial statement data for...Ch. 5 - Determining gross profit During the current year,...Ch. 5 - Determining cost of goods sold For a recent year,...Ch. 5 - Chart of accounts Monet Paints Co. is a newly...Ch. 5 - Purchase-related transactions The Stationery...Ch. 5 - Purchase-related transactions A retailer is...Ch. 5 - Purchase-related transactions The debits and...Ch. 5 - Purchase-related transactions Stylon Co., a...Ch. 5 - Prob. 5.8EXCh. 5 - Sales-related transactions, including the use of...Ch. 5 - Customer refund Senger Company sold merchandise of...Ch. 5 - Customer return and refund On December 28, 20Y3,...Ch. 5 - Sales-related transactions After the amount due on...Ch. 5 - Sales-related transactions The debits and credits...Ch. 5 - Prob. 5.14EXCh. 5 - Determining amounts to be paid on invoices...Ch. 5 - Prob. 5.16EXCh. 5 - Purchase-related transactions Based on the data...Ch. 5 - Prob. 5.18EXCh. 5 - Prob. 5.19EXCh. 5 - Normal balances of merchandise accounts What is...Ch. 5 - Income statement and accounts for merchandiser For...Ch. 5 - Adjusting entry for inventory shrinkage Omega Tire...Ch. 5 - Adjusting entry for customer refunds, allowances,...Ch. 5 - Adjusting entry for customer refunds, allowances,...Ch. 5 - Income statement for merchandiser The following...Ch. 5 - Determining amounts for items omitted from income...Ch. 5 - Multiple-step income statement On March 31, 20Y9,...Ch. 5 - Multiple-step income statement The following...Ch. 5 - Single-step income statement Summary operating...Ch. 5 - Closing the accounts of a merchandiser From the...Ch. 5 - Closing entries; net income Based on the data...Ch. 5 - Closing entries On July 31, the close of the...Ch. 5 - Prob. 5.33EXCh. 5 - Prob. 5.34EXCh. 5 - Prob. 5.35EXCh. 5 - Discount taken in next fiscal year Using the data...Ch. 5 - Prob. 5.37EXCh. 5 - Rules of debit and credit for periodic inventory...Ch. 5 - Journal entries using the periodic inventory...Ch. 5 - Identify items missing in determining cost of...Ch. 5 - Appendix Cost of goods sold and related items The...Ch. 5 - Cost of goods sold Based on the following data,...Ch. 5 - Cost of goods sold Based on the following data,...Ch. 5 - Appendix 2 Cost of goods sold Identify the errors...Ch. 5 - Closing entries using periodic inventory system...Ch. 5 - Purchase-related transactions using perpetual...Ch. 5 - Sales-related transactions using perpetual...Ch. 5 - Sales-related and purchase-related transactions...Ch. 5 - Sales-related and purchase-related transactions...Ch. 5 - Multiple-step income statement and balance sheet...Ch. 5 - Single-step income statement and balance sheet...Ch. 5 - Purchase-related transactions using periodic...Ch. 5 - Appendix Sales-related and purchase-related...Ch. 5 - Prob. 5.9APRCh. 5 - Periodic inventory accounts, multiple-step income...Ch. 5 - Purchase-related transactions using perpetual...Ch. 5 - Sales-related transactions using perpetual...Ch. 5 - Sales-related and purchase-related transactions...Ch. 5 - Sales-related and purchase-related transactions...Ch. 5 - Multiple-step income statement and balance sheet...Ch. 5 - Single-step income statement and balance sheet...Ch. 5 - Prob. 5.7BPRCh. 5 - Prob. 5.8BPRCh. 5 - Prob. 5.9BPRCh. 5 - Periodic inventory accounts, multiple-step income...Ch. 5 - Comprehensive Problem 2 8. Net income: 741,455...Ch. 5 - Analyze and compare Amazon.com and Netflix...Ch. 5 - Analyze Dollar General Dollar General Corporation...Ch. 5 - Compare Dollar Tree and Dollar General The asset...Ch. 5 - Prob. 5.4MADCh. 5 - Analyze Home Depot The Home Depot (HD) reported...Ch. 5 - Prob. 5.6MADCh. 5 - Analyze J. C. Penney J. C. Penney Company, Inc....Ch. 5 - Prob. 5.1TIFCh. 5 - Prob. 5.2TIFCh. 5 - Prob. 5.5TIFCh. 5 - Prob. 5.6TIFCh. 5 - Prob. 5.7TIF
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