Following are the current asset and current liability sections of the balance sheets for Freedom Incorporated at January 31, 2023 and 2022 (in millions): Current Assets Cash Accounts receivable Inventories Total current assets Current Liabilities Note payable Accounts payable Other accrued liabilities. Total current liabilities. January 31, January 31, 2023 2022 $12 8 7 $ 27 $4 4 3 $ 11 11 11 $31 $4 1 3 $8 Required: a. Calculate the working capital and current ratio at each balance sheet date. b. Evaluate the firm's liquidity at each balance sheet date. c. Assume that the firm operated at a loss during the year ended January 31, 2023. How could cash have increased during the year?

Following are the current asset and current liability sections of the balance sheets for Freedom Incorporated at January 31, 2023 and 2022 (in millions): Current Assets Cash Accounts receivable Inventories Total current assets Current Liabilities Note payable Accounts payable Other accrued liabilities. Total current liabilities. January 31, January 31, 2023 2022 $12 8 7 $ 27 $4 4 3 $ 11 11 11 $31 $4 1 3 $8 Required: a. Calculate the working capital and current ratio at each balance sheet date. b. Evaluate the firm's liquidity at each balance sheet date. c. Assume that the firm operated at a loss during the year ended January 31, 2023. How could cash have increased during the year?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Presented below are data taken from the records of Sheffield Company. December 31,2020 December 31,2019 Cash $15,100 $7,900 Current assets other than cash 85,800 59,800 Long-term investments 10,100 53,000 Plant assets 335,200 214,500 $446,200 $335,200 Accumulated depreciation $20,200 $40,200 Current liabilities 39,600 22,000 Bonds payable 75,800 –0– Common stock 252,800 252,800 Retained earnings 57,800 20,200 $446,200 $335,200 Additional information: 1. Held-to-maturity debt securities carried at a cost of $42,900 on December 31, 2019, were sold in 2020 for $33,600. The loss (not unusual) was incorrectly charged directly to Retained Earnings. 2. Plant assets that cost $49,600 and were 80% depreciated were sold during 2020 for $7,900. The loss was incorrectly charged directly to Retained Earnings. 3. Net income as reported on the…
Presented below are data taken from the records of Wildhorse Company. December 31,2020 December 31,2019 Cash $15,200 $8,100 Current assets other than cash 84,700 60,600 Long-term investments 10,000 52,900 Plant assets 332,400 215,200 $442,300 $336,800 Accumulated depreciation $20,100 $40,100 Current liabilities 39,600 22,100 Bonds payable 74,800 –0– Common stock 254,500 254,500 Retained earnings 53,300 20,100 $442,300 $336,800 Additional information: 1. Held-to-maturity debt securities carried at a cost of $42,900 on December 31, 2019, were sold in 2020 for $33,600. The loss (not unusual) was incorrectly charged directly to Retained Earnings. 2. Plant assets that cost $50,500 and were 80% depreciated were sold during 2020 for $8,000. The loss was incorrectly charged directly to Retained Earnings. 3. Net income as reported on the…
Given the following financial statement information: $ in millions Income Statement Net Income: $559 Depreciation Expense: $55 Balance Sheet Dec. 31, 2022 Accounts Receivable $38 Total Inventory $122 Accounts Payable $79 Calculate the cash from operating activities. Your Answer: Dec. 31, 2023 $64 $152 $108
The current sections of Famous’s statements of financial position at December 31, 2019 and 2020, are presented here. Famous’s net income for 2020 was €147,000. Depreciation expense was €21,000. 2020 2019 Current assets Prepaid expenses €25,000 €27,000 Inventory 158,000 172,000 Accounts receivable 79,000 110,000 Cash 105,000 99,000 Total current assets €367,000 €408,000 Current liabilities Accrued expenses payable € 15,000 € 9,000 Accounts payable 85,000 95,000 Total current liabilities €100,000 €104,000 Instructions Prepare the net cash provided by operating activities section of the company’s statement of cash flows for the year ended December 31, 2020, using the indirect method.
ASSETS Cash Accounts Receivable Inventory Plant and equipment Accumulated Depreciation TOTAL ASSETS LIABILITIES Accounts Payable Accrued Expenses Long Term Notes Payable TOTAL LIABILITIES EQUITIES Common Stock, No Par Retained Earnings TOTAL EQUITIES TOTAL LIABILITIES & EQUITIES COMPUTE THE 1. Current Ratio for 2020 & 2021 2. Quick Ratio for 2020 & 2021 2021 45,000.00 212,500.00 155,000.00 1,885,000.00 (480,000.00) 1,817,500.00 55,000.00 112,500.00 250,000.00 417,500.00 1,000,000.00 400,000.00 1,400,000.00 1,817,500.00 2020 50,000.00 207,500.00 140,000.00 1,662,500.00 (375,000.00) 1,685,000.00 47,500.00 110,000.00 237,500.00 395,000.00 1,000,000.00 290,000.00 1,290,000.00 1,685,000.00