Part I Assume current assets totaled $120,000 and the current liabilities totaled $80,000 before the following...

 

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Part I Assume current assets totaled $120,000 and the current liabilities totaled $80,000 before the following independent transactions: (i) Purchased merchandise for $40,000 on account. (ii) Purchased a delivery truck for $25,000. Paid $3,000 cash and signed a note payable due to be paid in two years for the balance. Required: (Show all calculations and round ALL answers to 2 decimal places.) Compute the current ratio after each independent transaction. Part II BIGBIG and CYCY, Incorporation are the two largest toy companies in the world. Shown below are the ratios adapted from their recent annual reports: Debt ratio Interest coverage ratio BIGBIG 45.5% 10.5 CYCY 40.5% 15.6 Required: Interpret the ratio differences between the two companies. Part I Assume current assets totaled $120,000 and the current liabilities totaled $80,000 before the following independent transactions: (i) Purchased merchandise for $40,000 on account. (ii) Purchased a delivery truck for $25,000. Paid $3,000 cash and signed a note payable due to be paid in two years for the balance. Required: (Show all calculations and round ALL answers to 2 decimal places.) Compute the current ratio after each independent transaction. Part II BIGBIG and CYCY, Incorporation are the two largest toy companies in the world. Shown below are the ratios adapted from their recent annual reports: Debt ratio Interest coverage ratio BIGBIG 45.5% 10.5 CYCY 40.5% 15.6 Required: Interpret the ratio differences between the two companies.

Answer rating: 100% (QA)

part 1 adjustment 1 current asset 120000 40000 160000 current liability 80000 40000 120000 current r... View the full answer