NELSON COMPANY Unadjusted Trial Balance January 31 Debit Credit Cash $ 19,800 Merchandise inventory 14,500 Store...

Transcribed Image Text:

NELSON COMPANY Unadjusted Trial Balance January 31 Debit Credit Cash $ 19,800 Merchandise inventory 14,500 Store supplies 5,300 Prepaid insurance 2,600 Store equipment 42,500 Accumulated depreciation-Store equipment $ 19,150 Accounts payable 15,000 Common stock 4,000 Retained earnings 31,000 Dividends 2,250 Sales 116,400 Sales discounts 2,000 Sales returns and allowances 2,200 Cost of goods sold 38,000 Depreciation expense-Store equipment 0 Sales salaries expense 14,600 Office salaries expense 14,600 Insurance expense 0 Rent expense-Selling space 9,000 Rent expense-Office space 9,000 Store supplies expense Advertising expense Totals 0 9,200 $ 185,550 $ 185,550 Additional Information: a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end. Problem 4-5A (Algo) Part 4 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31. Note: Round your answers to 2 decimal places. Current ratio Acid-test ratio 1 1 Gross margin ratio 1 NELSON COMPANY Unadjusted Trial Balance January 31 Debit Credit Cash $ 19,800 Merchandise inventory 14,500 Store supplies 5,300 Prepaid insurance 2,600 Store equipment 42,500 Accumulated depreciation-Store equipment $ 19,150 Accounts payable 15,000 Common stock 4,000 Retained earnings 31,000 Dividends 2,250 Sales 116,400 Sales discounts 2,000 Sales returns and allowances 2,200 Cost of goods sold 38,000 Depreciation expense-Store equipment 0 Sales salaries expense 14,600 Office salaries expense 14,600 Insurance expense 0 Rent expense-Selling space 9,000 Rent expense-Office space 9,000 Store supplies expense Advertising expense Totals 0 9,200 $ 185,550 $ 185,550 Additional Information: a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end. Problem 4-5A (Algo) Part 4 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31. Note: Round your answers to 2 decimal places. Current ratio Acid-test ratio 1 1 Gross margin ratio 1