1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Svetlanka [38]
1 year ago
12

Denna Company's working capital accounts at the beginning of the year follow:

Business
1 answer:
riadik2000 [5.3K]1 year ago
4 0

1. Compute the subsequent amounts and ratios as of the beginning of the year:

a. capital = current assets - current liabilities

working capital = ($50,000 + $30,000 + $200,000 + $210,000 + $10,000) - ($150,000 + $30,000 + $20,000)

= $500,000 - $200,000

= $300,000

b. Current ratio = current assets / current liabilities

current ratio = $500,000 / $200,000

                    = 2.5

c. Acid-test ratio = (current assets - inventory) / current liabilities

acid test ratio = ($500,000 - $210,000) / $200,000

                       = $290,000 / $200,000

                           = 1.45

Financial Ratios :

These are the tools normally utilized in financial management that serve as multi-purpose for other reasons such as obtaining a loan from bank, infusion of additional capital from investors, etc

Acid test ratios :

In finance, the fast ratio, also referred to as the acid-test ratio is a type of liquidity ratio, which measures the power of a company to use its near cash or quick assets to extinguish or retire its current liabilities immediately.

Learn more about current ratio :

brainly.com/question/14770071

#SPJ4

You might be interested in
Increased capital investment is generally used for what business expenses?
Aleksandr [31]
A. Capital expenditures
3 0
2 years ago
Several years ago, Joy acquired a passive activity. Until 2018, the activity was profitable. Joy's at-risk amount at the beginni
Galina-37 [17]

Answer:

b. $20,000: $250,000

Explanation:

The computation is shown below:

The passive activity rules at the opening of 2021 would be equivalent to the amount given i.e. $250,000

And, the suspended amount would be

= $100,000 + $80,000 + $90,000 - $250,000

= $270,000 - $250,000

= $20,000

Hence, the correct option is b.

3 0
3 years ago
The original use of the internet was to conduct business between corporations and its customers.
SIZIF [17.4K]
Your Answer is A. True
3 0
3 years ago
Read 2 more answers
g a. Provide the journal entry if the investor purchases the assets and assumes the liabilities of the investee company.
iragen [17]

Answer:

Debit : All assets bought at their Fair Value Amounts

Debit : Goodwill (<em>if Payment is greater than Net Assets acquired</em>)

Credit : All liabilities assumed at their Fair Value Amounts

Credit : Method of payment for example cash

Credit : Gain on acquisition (<em>if Net Assets acquired are greater than Payment</em>)

Explanation:

<em>Hi, your question is incomplete, i tried to look for the full question online but i could not find it.</em>

However, below is an explanation to solving the problem.

An acquisition of investee Assets and Liabilities is not a business combination transaction that requires preparation of consolidated financial statements.

A business combination is a transaction or event in which an ACQUIRER obtains CONTROL of one or more Businesses. So, if it is not a business, it is a mere ASSET ACQUISITION transaction.

Thus said, in our question investor purchases the assets and assumes the liabilities of the investee company, this is an Asset Acquisition transaction and not a Business Combination transaction.

The excess of consideration paid over the net assets acquired at fair value is called goodwill and must be recognized. If not the case the excess of net assets acquired over purchase price (gain on acquisition) must be recognized.

<u>Below are the accounting entries to record an Asset Acquisition transaction.</u>

Debit : All assets bought at their Fair Value Amounts

Debit : Goodwill (<em>if Payment is greater than Net Assets acquired</em>)

Credit : All liabilities assumed at their Fair Value Amounts

Credit : Method of payment for example cash

Credit : Gain on acquisition (<em>if Net Assets acquired are greater than Payment</em>)

5 0
2 years ago
What is comdominance?
zzz [600]
Comdominance isnt a word. Assuming you mean
Codominance which is a relationship between two versions of a gene. They are called allele; one given from each parent
6 0
2 years ago
Other questions:
  • Adjusting Entries are:
    5·2 answers
  • Think of a business idea that offers opportunity for customer credit. Assuming that you want to adopt this idea, what criteria w
    14·1 answer
  • Inferior Company sells products that are poorly made. Jock, who has never bought an Inferior product, files a suit against Infer
    5·1 answer
  • Any changes to a firm's projected future cash flows that are caused by adding a new project are referred to as:
    5·1 answer
  • Why in the fudge does trump (a literall orange) think hes the best person ever
    6·2 answers
  • __________is a process whereby companies compare their practices and performance measurements to those of other companies.
    13·1 answer
  • 1) A global company can be headquartered anywhere, but usually most of its employees come
    7·1 answer
  • What Characteristics of the Confederate States of American made it a confederal government when compared to the government of th
    12·1 answer
  • Which options are available in Layout view? Check all that apply.
    12·1 answer
  • Approximately what percentage of a reduction in errors did international air transport association have when thier employees wor
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!