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EXERCISES: 1. XYZ Corporation's most recent balance sheet and income statement appear below: XYZ Corporation Statement of Financial Position As of December 31, 2020 2019 Current Assets P 160,000 240,000 130,000 P 180,000 300,000 130,000 Cash Accounts receivable Inventory Prepaid expenses Total current assets Plant and equipment, net 60,000 590,000 910,000 P 1.500,000 P1,540,000 60,000 670,000 870,000 Total Assets Current Liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Bonds payable Total Liabilities P 150,000 30,000 90.000 270,000 190,000 460,000 P 180,000 30,000 90,000 300,000 220,000 520,000 Stockholders' Equity: Preferred stock, P100 par value, 5% Common stock, P10 par value Additional paid-in-capital – common Retained earnings Total Stockholders' Equity Total Liabilities & Stockholders' Equity AB 200,000 100,000 140,000 _600,000 1,040,000 P 1,500,000 P1,540,000 200,000 100,000 140,000 580,000 1,020,000 XYZ Corporation Income Statement For the Year Ended December 31, 2020 P 1,240,000 (820,000) 420,000 Sales (all on account) Cost of goods sold Gross Margin Selling and administrative expense Net operating income Interest expense Net income before taxes |(290,000) 130,000 (30,000) 100,000 (30,000) P 70,000 Income taxes (30%) Net income Required: Compute the following for 2020: a. Working capital.

EXERCISES: 1. XYZ Corporation's most recent balance sheet and income statement appear below: XYZ Corporation Statement of Financial Position As of December 31, 2020 2019 Current Assets P 160,000 240,000 130,000 P 180,000 300,000 130,000 Cash Accounts receivable Inventory Prepaid expenses Total current assets Plant and equipment, net 60,000 590,000 910,000 P 1.500,000 P1,540,000 60,000 670,000 870,000 Total Assets Current Liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Bonds payable Total Liabilities P 150,000 30,000 90.000 270,000 190,000 460,000 P 180,000 30,000 90,000 300,000 220,000 520,000 Stockholders' Equity: Preferred stock, P100 par value, 5% Common stock, P10 par value Additional paid-in-capital – common Retained earnings Total Stockholders' Equity Total Liabilities & Stockholders' Equity AB 200,000 100,000 140,000 _600,000 1,040,000 P 1,500,000 P1,540,000 200,000 100,000 140,000 580,000 1,020,000 XYZ Corporation Income Statement For the Year Ended December 31, 2020 P 1,240,000 (820,000) 420,000 Sales (all on account) Cost of goods sold Gross Margin Selling and administrative expense Net operating income Interest expense Net income before taxes |(290,000) 130,000 (30,000) 100,000 (30,000) P 70,000 Income taxes (30%) Net income Required: Compute the following for 2020: a. Working capital.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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EXERCISES: 1. XYZ Corporation's most recent balance sheet and income statement appear below: XYZ Corporation Statement of Financial Position As of December 31, 2020 2019 Current Assets P 180,000 300,000 130,000 | 60,000 670,000 870,000 P 1,500,000 P1.,540,000 P 160,000 240,000 130,000 Cash Accounts receivable Inventory Prepaid expenses Total current assets 60,000 590,000 910,000 Plant and equipment, net Total Assets Current Liabilities: P 150,000 30,000 90,000 270,000 190,000 460,000 P 180,000 30,000 90,000 300,000 220,000 520,000 Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Bonds payable Total Liabilities Stockholders' Equity: Preferred stock, P100 par value, 5% Common stock, P10 par value Additional paid-in-capital – common Retained earnings Total Stockholders' Equity Total Liabilities & Stockholders' Equity AB 200,000 100,000 140,000 600,000 1,040,000 P 1,500,000 PI1,540,000 200,000 100,000 140,000 580,000 1,020,000 XYZ Corporation Income Statement For the Year Ended December 31, 2020 Sales (all on account) Cost of goods sold Gross Margin Selling and administrative expense Net operating income Interest expense Net income before taxes P 1,240,000 (820,000) 420,000 |(290,000) 130,000 |(30,000) 100,000 (30,000) P 70,000 Income taxes (30%) Net income Required: Compute the following for 2020: a. Working capital.
Transcribed Image Text:EXERCISES: 1. XYZ Corporation's most recent balance sheet and income statement appear below: XYZ Corporation Statement of Financial Position As of December 31, 2020 2019 Current Assets P 180,000 300,000 130,000 | 60,000 670,000 870,000 P 1,500,000 P1.,540,000 P 160,000 240,000 130,000 Cash Accounts receivable Inventory Prepaid expenses Total current assets 60,000 590,000 910,000 Plant and equipment, net Total Assets Current Liabilities: P 150,000 30,000 90,000 270,000 190,000 460,000 P 180,000 30,000 90,000 300,000 220,000 520,000 Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Bonds payable Total Liabilities Stockholders' Equity: Preferred stock, P100 par value, 5% Common stock, P10 par value Additional paid-in-capital – common Retained earnings Total Stockholders' Equity Total Liabilities & Stockholders' Equity AB 200,000 100,000 140,000 600,000 1,040,000 P 1,500,000 PI1,540,000 200,000 100,000 140,000 580,000 1,020,000 XYZ Corporation Income Statement For the Year Ended December 31, 2020 Sales (all on account) Cost of goods sold Gross Margin Selling and administrative expense Net operating income Interest expense Net income before taxes P 1,240,000 (820,000) 420,000 |(290,000) 130,000 |(30,000) 100,000 (30,000) P 70,000 Income taxes (30%) Net income Required: Compute the following for 2020: a. Working capital.
b. Current ratio. c. Acid-test ratio. d. Accounts receivable turnover. e. Average collection period. f. Inventory turnover. g. Average sale period. 2. Selected data from the Company are presented below: Total assets Average assets Net income P1,600,000 1,750,000 245,000 Net sales Average common stockholders' equity Net cash provided by operating activities 1,225,000 1,000,000 294,000 Calculate the following profitability ratios. a. Profit margin b. Asset turnover c. Return on assets d. Return on common stockholders' equity ABAY e. Cash return on sales 3. The Corporation's net operating income last year was P103,000; its interest expense was P17,000; its total stockholders' equity was P1,260,000; and its total liabilities were P380,000. Compute the following: a. Times interest eamed. b. Debt-to-equity ratio.
Transcribed Image Text:b. Current ratio. c. Acid-test ratio. d. Accounts receivable turnover. e. Average collection period. f. Inventory turnover. g. Average sale period. 2. Selected data from the Company are presented below: Total assets Average assets Net income P1,600,000 1,750,000 245,000 Net sales Average common stockholders' equity Net cash provided by operating activities 1,225,000 1,000,000 294,000 Calculate the following profitability ratios. a. Profit margin b. Asset turnover c. Return on assets d. Return on common stockholders' equity ABAY e. Cash return on sales 3. The Corporation's net operating income last year was P103,000; its interest expense was P17,000; its total stockholders' equity was P1,260,000; and its total liabilities were P380,000. Compute the following: a. Times interest eamed. b. Debt-to-equity ratio.
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