The following data are from the 2015 financial report of Generic Clothing Company:

a. Based upon the above data, compute the following for Generic Clothing Company for both 2014 and 2015:
(1) The current ratio
(2) The quick ratio
b. Assume that net credit sales for the years ended December 31, 2014, and 2015, were $780,000 and $800,000, respectively, and that the balance of accounts receivable as of January 1, 2014, was $100,000.
Compute the receivables turnover and days outstanding for both years.
c. Does it appear that the solvency position of the company improved or worsened from 2014 to 2015? Explain.

  • CreatedAugust 19, 2014
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