Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 1, Problem 12E
Exercise 1-12A Differences between interest and dividends
Assume that Harris Company acquires $3,600 cash from creditors and $4,200 cash from investors.
Required
- a. Explain the primary differences between investors and creditors.
- b. If Harris has a net income of $2,000 and then liquidates, what amount of cash will the creditors receive? What amount of cash will the investors receive?
- c. If Harris has a net loss of $2,000 cash and then liquidates, what amount of cash will the creditors receive? What amount of cash will the investors receive?
- d. If Harris has a net loss of $4,900 cash and then liquidates, what amount of cash will the creditors receive? What amount of cash will the investors receive?
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Question 1
The following information represent Mooncake Corporation
Details
Sales
Cash
Inventory
Current liabilities
Asset turnover
Current ratio
Debt to asset ratio
Receivables turnover
Calculate the following items:
a. Accounts receivables
b. Fixed asset
c. Long Term Debt
d. Debt to Asset Ratio
RM
3,549,000
179,000
911,000
788,000
1.40
2.95 times
40%
7 times
Exercise 11-21A (Static) Interpreting the effects of business liquidation on creditors and owners LO 11-10
Assume that Harris Company acquires $3,600 cash from creditors and $4,200 cash from investors.
Required
b. If Harris Company has net income of $2,000 and then liquidates, what amount of cash will the creditors receive? What amount of
cash will the investors receive?
Creditors receive
Investors receive
c. If Harris Company has a net loss of $2,000 cash and then liquidates, what amount of cash will the creditors receive? What amount of
cash will the investors receive?
Creditors receive
Investors receive
d. If Harris Company has a net loss of $4,900 cash and then liquidates, what amount of cash will the creditors receive? What amount of
cash will the investors receive?
Creditors receive
Investors receive
Question Content Area
ABC Inc. borrows $50,000 from a bank to finance its operations. Which of the following statements regarding the effect of this transaction on the company's liquidity and profitability metric is true?
a.The transaction increases the liquidity and has no effect on the profitability of ABC Inc.
b.The transaction decreases the liquidity and increases the profitability of ABC Inc.
c.The transaction has no effect on the liquidity and profitability of ABC Inc.
d.The transaction increases the liquidity and decreases the profitability of ABC Inc.
Chapter 1 Solutions
Survey Of Accounting
Ch. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3QCh. 1 - 4. In a business context, what does the term...Ch. 1 - 5. What market trilogy components are involved in...Ch. 1 - 6. Give an example of a financial resource, a...Ch. 1 - Prob. 7QCh. 1 - 8. How do financial and managerial accounting...Ch. 1 - Prob. 9QCh. 1 - Prob. 10Q
Ch. 1 - Prob. 11QCh. 1 - 12. Distinguish between elements of financial...Ch. 1 - Prob. 13QCh. 1 - 14. To whom do the assets of a business belong?Ch. 1 - 15. Describe the differences between creditors and...Ch. 1 - Prob. 16QCh. 1 - Prob. 17QCh. 1 - Prob. 18QCh. 1 - 19. What does a double-entry bookkeeping system...Ch. 1 - 22. How does acquiring capital from owners affect...Ch. 1 - Prob. 21QCh. 1 - Prob. 22QCh. 1 - 25. What are the three primary sources of assets?Ch. 1 - 26. What is the source of retained earnings?Ch. 1 - 27. How does distributing assets (paying...Ch. 1 - 28. What are the similarities and differences...Ch. 1 - Prob. 27QCh. 1 - 30. Which of the general-purpose financial...Ch. 1 - 31. What causes a net loss?Ch. 1 - 35. What three categories of cash receipts and...Ch. 1 - Prob. 31QCh. 1 - 37. Discuss the term articulation as it relates to...Ch. 1 - 38. How do temporary accounts differ from...Ch. 1 - Prob. 34QCh. 1 - 41. Identify the three types of accounting...Ch. 1 - Prob. 36QCh. 1 - Prob. 37QCh. 1 - Prob. 1ECh. 1 - Prob. 2ECh. 1 - Exercise 1-3A Identifying the reporting entities...Ch. 1 - Exercise 1-4A Define Terms and Identify Missing...Ch. 1 - Exercise 1-5 Effect of events on the accounting...Ch. 1 - Exercise 1-6 Effect of transactions on general...Ch. 1 - Exercise 1-7 Missing information and recording...Ch. 1 - Prob. 8ECh. 1 - Exercise 1-9A Record events and interpret...Ch. 1 - Exercise 1-10 Interpreting the accounting equation...Ch. 1 - Prob. 11ECh. 1 - Exercise 1-12A Differences between interest and...Ch. 1 - Exercise 1-13A Classifying events as asset source,...Ch. 1 - Prob. 14ECh. 1 - Exercise 1-15 Preparing an income statement and a...Ch. 1 - Prob. 16ECh. 1 - Prob. 17ECh. 1 - Prob. 18ECh. 1 - Prob. 19ECh. 1 - Riley Company paid 60,000 cash to purchase land...Ch. 1 - Prob. 21ECh. 1 - As of January 1, 2018, Room Designs, Inc. had a...Ch. 1 - As of December 31, 2018, Flowers Company had total...Ch. 1 - Prob. 24ECh. 1 - Critz Company was started on January 1, 2018....Ch. 1 - The Candle Shop experienced the following events...Ch. 1 - Prob. 27ECh. 1 - Prob. 28PCh. 1 - Prob. 29PCh. 1 - Match the terms (identified as a through r) with...Ch. 1 - Problem 1-30A Classifying events as asset source,...Ch. 1 - Problem 1-31A Relating titles and accounts to...Ch. 1 - Marks Consulting experienced the following...Ch. 1 - Prat Corp. started the 2018 accounting period with...Ch. 1 - Maben Company was started on January 1, 2018, and...Ch. 1 - Required Use the Target Corporations Form 10-K to...Ch. 1 - ATC 1-5 Writing Assignment Elements of financial...
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