Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Question
Chapter 6, Problem 6.17E
To determine
The given company’s working capital and current ratio for 2019 and 2018 and comment on its liquidity and changes in liquidity from 2018 to 2019.
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Condensed financial data of Cullumber Company for 2020 and 2019 are presented below.
CULLUMBER COMPANYCOMPARATIVE BALANCE SHEETAS OF DECEMBER 31, 2020 AND 2019
2020
2019
Cash
$1,790
$1,170
Receivables
1,780
1,310
Inventory
1,580
1,900
Plant assets
1,900
1,720
Accumulated depreciation
(1,180
)
(1,140
)
Long-term investments (held-to-maturity)
1,310
1,420
$7,180
$6,380
Accounts payable
$1,220
$880
Accrued liabilities
210
240
Bonds payable
1,380
1,550
Common stock
1,930
1,660
Retained earnings
2,440
2,050
$7,180
$6,380
CULLUMBER COMPANYINCOME STATEMENTFOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue
$6,690
Cost of goods sold
4,650
Gross margin
2,040
Selling and administrative expenses
930
Income from…
Condensed financial data of Bridgsport Company for 2020 and 2019 are presented below.
BRIDGEPORT COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2020 AND 2019
2020
2019
Cash
$1,820
$1,150
Receivables
1,780
1,310
Inventory
1,600
1,930
Plant assets
1,930
1,710
Accumulated depreciation
(1,200 )
[1,160 }
Long-term investments (held-to-maturity)
1,320
1,400
$7,250
$6,340
Accounts payable
$1190
SB80
Accrued liabilities
190
270
Bonds payable
1,430
1,520
Common stock
1,900
1,730
Retained carnings
2,540
1,940
$7,250
$6,340
BRIDGEPORT COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue
$6,860
Cost of goods sold
4,620
Gross margin
2,240
Selling and administrative expenses
920
Income from operations
1,320
Other revenuss and gains
Gain on sale of investments
B0
Income before tax
1,400
Income tax expense
540
Net income
B60
Cash dividends
260
Income ratained in business
$600
Additional information:
During the year, $70 of common stock was issued in exchanga for plant…
Selected financial statement information for 2018, 2019, and 2023 for End Run
Corporation is presented below (amounts in millions of dollars):
Accounts receivable
Current assets
Property, plant, and equipment (net)
Total assets
Current liabilities
Long-term debt
Sales
Cost of goods sold
Selling and administrative expenses
Income from continuing operations
Cash flow from operations
Depreciation expense
2020
A. 2020 SAI
B. 2020 LVGI
C. 2020 TATA
D.
2020 Y
E. 2020 earnings manipulation probability
10508
30945
11284
68787
29417
8776
101573
92207
3931
946
4837
518
2019
3905
7438
10744
31289
6595
7223
47860
32090
3315
1063
1127
550
2018
2985
5743
10493
26213
6048
7223
33906
27772
2582
739
1863
550
For 2019 and 2020, compute the following amounts relative to Beneish's eight-factor
earnings
manipulation model:
Chapter 6 Solutions
Intermediate Accounting (2nd Edition)
Ch. 6 - What are the limitations of the balance sheet?Ch. 6 - What does a firms liquidity measure?Ch. 6 - Prob. 6.3QCh. 6 - What are the four major components of stockholders...Ch. 6 - Prob. 6.5QCh. 6 - Prob. 6.6QCh. 6 - Where is accumulated other comprehensive income...Ch. 6 - Prob. 6.8QCh. 6 - Prob. 6.9QCh. 6 - What are the two main balance sheet formats?...
Ch. 6 - Prob. 6.11QCh. 6 - Prob. 6.12QCh. 6 - What are the two formatting options for reporting...Ch. 6 - What is financial statement articulation?Ch. 6 - How is net income closed? Is the closing entry the...Ch. 6 - Why are the notes to the financial statements an...Ch. 6 - Prob. 6.17QCh. 6 - What is a subsequent event?Ch. 6 - What is a subsequent event under IFRS?Ch. 6 - How do firms report a material subsequent event on...Ch. 6 - Prob. 6.21QCh. 6 - Over what period must management assess the...Ch. 6 - Prob. 6.23QCh. 6 - Prob. 6.24QCh. 6 - Prob. 6.25QCh. 6 - Prob. 6.26QCh. 6 - Prob. 6.27QCh. 6 - Prob. 6.28QCh. 6 - Prob. 6.29QCh. 6 - Prob. 6.30QCh. 6 - Prob. 6.31QCh. 6 - Who is responsible for designing and implementing...Ch. 6 - Prob. 6.33QCh. 6 - What are the two key measures of liquidity?...Ch. 6 - What does the debt-to-equity ratio measure for a...Ch. 6 - What does a high current ratio indicate about a...Ch. 6 - Is it useful to compare working capital among...Ch. 6 - Sykes Corporations comparative balance sheets at...Ch. 6 - During Year 1, Brianna Company had the following...Ch. 6 - Which of the following items would not be included...Ch. 6 - Kong Co. purchased a three-month U.S. Treasury...Ch. 6 - Prob. 6.5MCCh. 6 - Prob. 6.6MCCh. 6 - In its year-end income statement, Black Knights...Ch. 6 - On is current year income statement, Vegas...Ch. 6 - Advantages of the Statement of Financial Position....Ch. 6 - Prob. 6.2BECh. 6 - Prob. 6.3BECh. 6 - Account Classification: Current and Noncurrent...Ch. 6 - Classified Balance Sheet. Armstrong Associates...Ch. 6 - Classified Balance Sheet, Report Format. Martell...Ch. 6 - Classified Balance Sheet, Account Format. Using...Ch. 6 - Classified Balance Sheet. Report Format.Bowe...Ch. 6 - Classified Balance Sheet, Account Format. Using...Ch. 6 - Classification as Operating. Investing, or...Ch. 6 - Prob. 6.11BECh. 6 - Classification as Operating, Investing, or...Ch. 6 - Classification as Operating. Investing, or...Ch. 6 - Classification as Operating, Investing, or...Ch. 6 - Classification as Operating, Investing, or...Ch. 6 - Classification as Operating, Investing, or...Ch. 6 - Classification as Operating, Investing, or...Ch. 6 - Prob. 6.18BECh. 6 - Statement of Cash Flows, Indirect Method. Identity...Ch. 6 - Financial Statement Articulation. Complete the...Ch. 6 - Prob. 6.21BECh. 6 - Prob. 6.22BECh. 6 - Prob. 6.23BECh. 6 - Prob. 6.24BECh. 6 - Statement of Cash Flows, Indirect Method. Tennis...Ch. 6 - Statement of Cash Flows, Direct Method. Use the...Ch. 6 - Prob. 6.27BECh. 6 - Ratio Analyses. Green Grasshopper Incorporated is...Ch. 6 - Classification of Assets and Liabilities. Darin...Ch. 6 - Prob. 6.2ECh. 6 - Prob. 6.3ECh. 6 - Prob. 6.4ECh. 6 - Prepare Balance Sheet. Blackburn Building Products...Ch. 6 - Prepare Balance Sheet. Lake Company provided the...Ch. 6 - Statement of Cash Flows, Indirect Method. Tulsa...Ch. 6 - Prob. 6.8ECh. 6 - Prob. 6.9ECh. 6 - Prob. 6.10ECh. 6 - Prob. 6.11ECh. 6 - Financial Statement Articulation. Use the...Ch. 6 - Prob. 6.13ECh. 6 - Prob. 6.14ECh. 6 - Prob. 6.15ECh. 6 - Prob. 6.16ECh. 6 - Prob. 6.17ECh. 6 - Solvency Analyses. The following items are from...Ch. 6 - Prepare Balance Sheet. Larkin Corporation provided...Ch. 6 - Prob. 6.2PCh. 6 - Prepare Balance Sheet. Jennings Incorporated...Ch. 6 - Prepare Stockholders Equity Section of Balance...Ch. 6 - Prepare Stockholders Equity Section of Balance...Ch. 6 - Prepare Classified Balance Sheet.Centre Company...Ch. 6 - Prepare a classified balance sheet at December 31...Ch. 6 - Contents of the Annual Report, Financial Statement...Ch. 6 - Statement of Cash Flows, Operating Activities...Ch. 6 - Statement of Cash Flows, Operating Activities...Ch. 6 - Statement of Cash Flows, Direct Method. Prepare...Ch. 6 - Statement of Cash Flows, Indirect Method. Prepare...Ch. 6 - Prob. 6.13PCh. 6 - Statement of Cash Flows, Operating Activities...Ch. 6 - Statement of Cash Flows, Direct Method. Prepare...Ch. 6 - Prob. 6.16PCh. 6 - Prob. 1JCCh. 6 - UseFoot Locker. Inc.sbalance sheet and other...Ch. 6 - Prob. 1SSCCh. 6 - Surfing the Standards Case 2: True and Fair...Ch. 6 - Basis for Conclusions Cases Basis for Conclusions...Ch. 6 - Prob. 2BCC
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