a partial balance sheet and income statement for the king corporation are shown belo 544349
A partial balance sheet and income statement for the King Corporation are shown below and on the next page.
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KING CORPORATION Don't use plagiarized sources. Get Your Custom Essay on
a partial balance sheet and income statement for the king corporation are shown belo 544349
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Assets |
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Current assets: |
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Cash |
$ 33,493 |
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Marketable securities |
215,147 |
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Trade receivables, less allowance of $6,000 |
255,000 |
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Inventories, LIFO |
523,000 |
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Prepaid expenses |
26,180 |
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Total current assets |
$1,052,820 |
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Liabilities |
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Current liabilities: |
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Trade accounts payable |
$ 103,689 |
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Notes payable (primarily to banks) and commercial paper |
210,381 |
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Accrued expenses and other liabilities |
120,602 |
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Income taxes payable |
3,120 |
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Current maturities of long-term debt |
22,050 |
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Total current liabilities |
$ 459,842 |
Required Compute the following:
a. Working capital.
b. Current ratio
c. Acid-test ratio
d. Cash ratio
e. Days’ sales in receivables
f. Accounts receivable turnover in days
g. Days’ sales in inventory
h. Inventory turnover in days
i. Operating cycle
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KING CORPORATION |
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Net sales |
$3,050,600 |
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Miscellaneous income |
45,060 |
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$3,095,660 |
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Costs and expenses: |
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Cost of sales |
2,185,100 |
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Selling, general, and administrative expenses |
350,265 |
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Interest expense |
45,600 |
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Income taxes |
300,000 |
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2,880,965 |
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Net income |
$ 214,695 |
Note: The trade receivables at December 31, 2000, were $280,000, net of an allowance of $8,000, for a gross receivables figure of $288,000. The inventory at
December 31, 2000, was $565,000.
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