Financial Accounting, Student Value Edition (4th Edition)
4th Edition
ISBN: 9780134114811
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Textbook Question
Chapter 7, Problem 16SE
Quick ratio (Learning Objective 7) 5–10 min.
Calculate the quick assets and the quick ratio for each of the following companies:
| Rhodes | Peters | |
| Cash ............................................... | $15,000 | $ 23,000 |
| Short-term Investments ................................ | 6,000 | 13,000 |
| Net Receivables.......................................................................... | 41,000 | 51,000 |
| Current Liabilities .............................................................. | 40,000 | 108,750 |
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Best Industries is considering an investment project that has the following cash flows:Year 0β¦β¦β¦β¦β¦ $ -1,200Year 1β¦β¦β¦β¦β¦β¦. 200Year 2β¦β¦β¦β¦β¦β¦.. 200Year 3β¦β¦β¦β¦β¦β¦.. 800Year 4β¦β¦β¦β¦β¦β¦β¦ 300The companyβs discount rate for such calculations is 10%
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1. For Best Industries what is the projectβs IRR?a. 10.00%b. 11.92%c. 22.75%d. 8.40%
2. For Best Industries what is the NPV?a. $153b. $ -46.94c. $375.44d. $ -153.06
3. Internal rate of return is also:a. Yieldb. Rate of return c. Discount rate that makes the NPV equal to zerod. All of the above
Record each of these transactions
1 Cashβ¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦. 300,000
Β Β Β Β Β Β Β Β Β Β Β Capital Stockβ¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦Β Β Β Β Β Β Β Β Β Β Β Β 300,000
Β Β Β Issued capital stock at $60 per shareΒ
4 Diagnostic Equipmentβ¦β¦β¦β¦β¦β¦β¦β¦250,000
Β Β Β Β Β Β Β Β Β Β Β Cashβ¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β 100,000
Β Β Β Β Β Β Β Β Β Β Β Notes Payableβ¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β 150,000
Β Purchased equipment, paying part in cash and signing a note payable for the balance
12 Account Payableβ¦β¦β¦β¦β¦.......6,000
Β Β Β Β Β Β Β Β Β Β Β Cashβ¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦β¦.Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β $6,000
Paid account payable to Zeller Laboratories
19 surgical suppliesβ¦β¦β¦β¦β¦β¦β¦β¦4,000
Β Β Β Β Β Β Β Β Β Β Β Accounts Payableβ¦β¦β¦β¦β¦β¦β¦β¦β¦Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β $Β Β Β Β 4,000
25 Cashβ¦β¦β¦β¦β¦β¦β¦..80,000
Β Β Β Β Β Β Β Β Β Β Β Accounts Retrievableβ¦β¦β¦β¦β¦β¦β¦β¦..Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β 80,000
30 Dividendsβ¦β¦β¦β¦β¦$50,000
Β Β Β Β Β Β Β Β Β Β Β Cashβ¦β¦β¦β¦β¦..Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β 500,000Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β
Β
ADDITIONAL REQUIREMENT FOR 3.2
Posting of transaction from General Journal to T-Accounts
Prepare trialβ¦
The management of Unter Corporation, an architectural design firm, is considering an investment with thefollowing cash flows:Year Investment Cash Inflow1 ......................... $15,000 $1,0002 ......................... $8,000 $2,0003 ......................... $2,5004 ......................... $4,0005 ......................... $5,0006 ......................... $6,0007 ......................... $5,0008 ......................... $4,0009 ......................... $3,00010 ......................... $2,000Required:1. Determine the payback period of the investment.2. Would the payback period be affected if the cash inflow in the last year were several timesas large?
Chapter 7 Solutions
Financial Accounting, Student Value Edition (4th Edition)
Ch. 7.A - Prob. 1SECh. 7.A - Prob. 2SECh. 7.A - Prob. 3AECh. 7.A - Prob. 4AECh. 7.A - Prob. 5BECh. 7.A - Prob. 6BECh. 7.A - Prob. 7APCh. 7.A - Prob. 8APCh. 7 - Which duties should be segregated in the...Ch. 7 - Prob. 2DQ
Ch. 7 - Prob. 3DQCh. 7 - Why does the allowance method of accounting for...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - How would the net realizable value of Accounts...Ch. 7 - Prob. 9DQCh. 7 - Prob. 10DQCh. 7 - Prob. 1SCCh. 7 - Prob. 2SCCh. 7 - Prob. 3SCCh. 7 - Prob. 4SCCh. 7 - Prob. 5SCCh. 7 - Prob. 6SCCh. 7 - Prob. 7SCCh. 7 - Prob. 8SCCh. 7 - Prob. 9SCCh. 7 - Prob. 10SCCh. 7 - Prob. 11SCCh. 7 - Prob. 12SCCh. 7 - Prob. 1SECh. 7 - Prob. 2SECh. 7 - Prob. 3SECh. 7 - Prob. 4SECh. 7 - Prob. 5SECh. 7 - Prob. 6SECh. 7 - Prob. 7SECh. 7 - Prob. 8SECh. 7 - Prob. 9SECh. 7 - Prob. 10SECh. 7 - Prob. 11SECh. 7 - Prob. 12SECh. 7 - Prob. 13SECh. 7 - Prob. 14SECh. 7 - Prob. 15SECh. 7 - Quick ratio (Learning Objective 7) 510 min....Ch. 7 - Prob. 17SECh. 7 - Prob. 18AECh. 7 - Prob. 19AECh. 7 - Prob. 20AECh. 7 - Prob. 21AECh. 7 - Prob. 22AECh. 7 - Prob. 23AECh. 7 - Prob. 24AECh. 7 - Prob. 25AECh. 7 - Prob. 26AECh. 7 - Prob. 27AECh. 7 - Quick ratio and current ratio (Learning Objective...Ch. 7 - Prob. 29AECh. 7 - Prob. 30BECh. 7 - Prob. 31BECh. 7 - Prob. 32BECh. 7 - Prob. 33BECh. 7 - Prob. 34BECh. 7 - Prob. 35BECh. 7 - Prob. 36BECh. 7 - Prob. 37BECh. 7 - Prob. 38BECh. 7 - Prob. 39BECh. 7 - Quick ratio and current ratio (Learning Objective...Ch. 7 - Prob. 41BECh. 7 - Prob. 42APCh. 7 - Prob. 43APCh. 7 - Prob. 44APCh. 7 - Prob. 45APCh. 7 - Prob. 46APCh. 7 - Prob. 47APCh. 7 - Prob. 48APCh. 7 - Prob. 49BPCh. 7 - Prob. 50BPCh. 7 - Prob. 51BPCh. 7 - Prob. 52BPCh. 7 - Prob. 53BPCh. 7 - Prob. 54BPCh. 7 - Prob. 55BPCh. 7 - Continuing Exercise In this exercise, we continue...Ch. 7 - Prob. 1CPCh. 7 - Prob. 1CFSAPCh. 7 - Prob. 1EIACh. 7 - Prob. 2EIACh. 7 - Prob. 1FACh. 7 - Prob. 1IACh. 7 - Prob. 1SBACh. 7 - Prob. 1WC
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