How do I set this up? This is a few questions stuck together. Count as multiple questions I think. 4-12 Indicate the effect of the transactions listed in the following table on total current assets, current ration, and net income. Use (+) to indicate an increase, (-) to indicate a decrease, and (0) to indicate either no effect or an indeterminate effect. Be prepared to state any necessary assumptions and assume an initial current ratio of more than 1.0. Table for 4-12 Total Current Assets Current Ratio Effect on Net Income a Cash is acquired through issuance of additional stock. b Merchandise is sold for cash. c Federal income tax due for the previous year is paid. d A fixed asset is sold for less than book value. e A fixed asset is sold for more than book value. f Merchandise is sold on credit. g Payment is made to trade creditors for previous purchases. h A cash dividend is declared and paid. i Cash is obtained through short-term bank loans. j Short-term notes receivable are sold at a discount. k Marketable securities are sold below cost. l Advances are made to employees m Current operating expenses are paid. n Short-term promissory notes are issued to trade creditors in exchange for past due accounts payable. o 10-Year notes are issued to pay off accounts payable. p A fully depreciated asset is retired. q Accounts receivable are collected. r Equipment is purchased with short-term notes. s Merchandise is purchased on credit. t The estimated taxes payable are increased.
How do I set this up? This is a few questions stuck together. Count as multiple questions I think.
4-12 Indicate the effect of the transactions listed in the following table on total current assets, current ration, and net income. Use (+) to indicate an increase, (-) to indicate a decrease, and (0) to indicate either no effect or an indeterminate effect. Be prepared to state any necessary assumptions and assume an initial current ratio of more than 1.0.
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Table for 4-12 |
Total Current Assets |
Current Ratio |
Effect on Net Income |
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a |
Cash is acquired through issuance of additional stock. |
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b |
Merchandise is sold for cash. |
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c |
Federal income tax due for the previous year is paid. |
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d |
A fixed asset is sold for less than book value. |
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e |
A fixed asset is sold for more than book value. |
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f |
Merchandise is sold on credit. |
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g |
Payment is made to trade creditors for previous purchases. |
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h |
A cash dividend is declared and paid. |
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i |
Cash is obtained through short-term bank loans. |
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j |
Short-term notes receivable are sold at a discount. |
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k |
Marketable securities are sold below cost. |
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l |
Advances are made to employees |
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m |
Current operating expenses are paid. |
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n |
Short-term promissory notes are issued to trade creditors in exchange for past due accounts payable. |
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o |
10-Year notes are issued to pay off accounts payable. |
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p |
A fully |
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q |
Accounts receivable are collected. |
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r |
Equipment is purchased with short-term notes. |
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s |
Merchandise is purchased on credit. |
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t |
The estimated taxes payable are increased. |
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