Prior to the transactions listed below in the left column, Blue Inc. reported a debt-to-assets ratio of 0.50, asset turnover of 1.20, net profit margin of 0.30, and earnings per share of $1.00.

Required (to be completed in the chart below):

Complete the lettered cells in the following table by indicating whether each transaction causes the selected ratios for Blue Inc. to increase (+), decrease (–), or not change (NC). Notice you do not need to show the updated ratios. Consider each of the five transactions independently (i.e., on their own).

Transaction	Debt-to-Assets	Asset Turnover	Net Profit Margin	Earnings Per Share
Customers used previously issued gift certificates for food and drinks valued at $500.	(a)	(b)
Accrued $950 for this month’s utility bill, which will be paid next month.	(c)	(d)	(e)
Recorded $2,400 of depreciation this month.	(f)			(g)
Purchased and received, but didn’t yet pay for, equipment costing $550.	(h)
Received $60,000 cash from shareholders for additional common shares of Blue Inc.		(i)		(j)

Answer rating: 100% (QA)

To determine the effect of each transaction on the selected ratios for Blue Inc we need to consider ... View the full answer