Question

Financial statement data of Yankee Traveler magazine include the following items (dollars in thousands):
Cash.............................................................................................................. $ 23,000
Accounts receivable, net.............................................................................. $ 81,000 Inventories.................................................................................................... $ 192,100
Total assets................................................................................................... $ 630,000
Short- term notes payable............................................................................ $ 50,000
Accounts payable......................................................................................... $ 102,000
Accrued liabilities......................................................................................... $ 58,000
Long- term liabilities...................................................................................... $ 174,300
Net income................................................................................................... $ 72,000
Common shares outstanding....................................................................... 50,000

Requirements
1. Compute Yankee Traveler’s current ratio, debt ratio, and earnings per share. Round all ratios to two decimal places.
2. Compute the three ratios after evaluating the effect of each transaction that follows. Consider each transaction separately.
a. Purchased inventory on account, $ 36,000
b. Borrowed $ 189,000 on a long- term note payable
c. Issued 6,250 shares of common stock, receiving cash of $ 138,600
d. Received cash on account, $ 19,000



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  • CreatedAugust 27, 2014
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