Seminole, Inc., reported the following items at December 31, 2012, and 2011: Requirements 1. Compute Seminoles (a)
Question:
Requirements
1. Compute Seminoles (a) quick (acid-test) ratio and (b) days sales in average receivables for 2012. Evaluate each ratio value as strong or weak. Seminole sells on terms of net 30 days.
2. Recommend two ways for Seminole to improve its cash flow fromreceivables.
Transcribed Image Text:
Balance Sheets (Summarized) Year End Year End 2012 2011 2012 2011 Current assets: Current liabilities: Cash Marketable securities Accounts receivable, net Inventory Other current assets S 2,000 8,000 Aounts payable 24,000 13,000 Other current liabilities 57,00071,000 Long-term liabilities 196,000192,000 S 18,000 S 19,500 104,000105,000 14,000 16,000 5,000 5,000 Stockholders' equity 148,000 148,500 Long-term assets Total assets S284,000 $289,000 Total liabilities and equity $284,000 $289,000 2012 S731,000 Income Statement (partial): Sales revenue
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Related Book For
Financial accounting
ISBN: 978-0132751124
9th edition
Authors: Walter T. Harrison Jr., Charles T. Horngren, C. William Thom
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