Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Question
Just Dew It Corporation reports the following balance sheet information for 2020 and
2021.
Assets
Current assets
Cash
Accounts receivable
Inventory
Total
Total assets
2020
Net plant and equipment $240,750 $310,600
a. Current ratio
b. Quick ratio
c. Cash ratio
d. NWC ratio
e. Debt-equity ratio
e. Equity multiplier
f. Total debt ratio
f. Long-term debt ratio
$8,850 $14,200
15,750 23,000
34,650 52,200
$ 59,250 $89,400
JUST DEW IT CORPORATION
2020 and 2021 Balance Sheets
2021
300,000 400,000
2020
times
times
times
%
times
times
times
times
Liabilities and Owners' Equity
Current liabilities
2021
Accounts payable
Notes payable
Based on the balance sheets given for Just Dew It:
a. Calculate the current ratio for each year. (Do not round intermediate calculations
and round your answers to 2 decimal places, e.g., 32.16.)
b. Calculate the quick ratio for each year. (Do not round intermediate calculations and
round your answers to 2 decimal places, e.g., 32.16.)
c. Calculate the cash ratio for each year. (Do not round intermediate calculations and
round your answers to 2 decimal places, e.g., 32.16.)
d. Calculate the NWC to total assets ratio for each year. (Do not round intermediate
calculations and enter your answers as a percent rounded to 2 decimal places,
e.g., 32.16.)
e. Calculate the debt-equity ratio and equity multiplier for each year. (Do not round
intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
Calculate the total debt ratio and long-term debt ratio for each year. (Do not round
intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
f.
Total
Total
Total liabilities and owners' equity
times
times
times
%
times
times
times
times
2020
Long-term debt
Owners' equity
Common stock and paid-in surplus $ 45,000 $ 45,000
Retained earnings
178,650 265,000
2021
$37,500 $46,600
11,850 19,400
$ 49,350 $ 66,000
$ 27,000 $24,000
$
223,650 310,000
$
$
300,000 400,000
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Transcribed Image Text:Just Dew It Corporation reports the following balance sheet information for 2020 and 2021. Assets Current assets Cash Accounts receivable Inventory Total Total assets 2020 Net plant and equipment $240,750 $310,600 a. Current ratio b. Quick ratio c. Cash ratio d. NWC ratio e. Debt-equity ratio e. Equity multiplier f. Total debt ratio f. Long-term debt ratio $8,850 $14,200 15,750 23,000 34,650 52,200 $ 59,250 $89,400 JUST DEW IT CORPORATION 2020 and 2021 Balance Sheets 2021 300,000 400,000 2020 times times times % times times times times Liabilities and Owners' Equity Current liabilities 2021 Accounts payable Notes payable Based on the balance sheets given for Just Dew It: a. Calculate the current ratio for each year. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. Calculate the quick ratio for each year. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. Calculate the cash ratio for each year. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) d. Calculate the NWC to total assets ratio for each year. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) e. Calculate the debt-equity ratio and equity multiplier for each year. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Calculate the total debt ratio and long-term debt ratio for each year. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) f. Total Total Total liabilities and owners' equity times times times % times times times times 2020 Long-term debt Owners' equity Common stock and paid-in surplus $ 45,000 $ 45,000 Retained earnings 178,650 265,000 2021 $37,500 $46,600 11,850 19,400 $ 49,350 $ 66,000 $ 27,000 $24,000 $ 223,650 310,000 $ $ 300,000 400,000
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