Selected balance sheet accounts for Tibbetts Company on September 30, 2019, are as follows: Cash . .
Question:
Selected balance sheet accounts for Tibbetts Company on September 30, 2019, are as follows:
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 48,000Marketable securities . . . . . . . . . . . . . .... . . . . . . . . . . . . . . . . . . . . . . . . . 87,000Accounts receivable, net . . . . . . . . . . . . ... . . . . . . . . . . . . . . . . . . . . . . . 129,000Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135,000Prepaid expenses . . . . . . . . . . . . . . . . . . . .... . . . . . . . . . . . . . . . . . . . . . . 21,000Total current assets . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . $420,000Accounts payable . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . $147,000Other accrued liabilities . . . . . . . . . . . . . . . . ... . . . . . . . . . . . . . . . . . . . . 33,000Short-term debt . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . 60,000Total current liabilities . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . $240,000
Required:
a. Calculate the working capital, current ratio, and acid-test ratio for Tibbetts Company as of September 30, 2019.
b. Summarized here are the transactions/events that took place during the fiscal year ended September 30, 2020. Indicate the effect of each item on Tibbetts Company?s working capital, current ratio, and acid-test ratio. Use + for increase, for decrease, and (NE) for no effect. [Hint: It may be helpful to use the horizontal model or to record the journal entry(ies) for each item before considering the effects on liquidity measures.]
Balance SheetBalance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
Accounting What the Numbers Mean
ISBN: 978-1260565492
12th edition
Authors: David Marshall, Wayne McManus, Daniel Viele