All categories

3 years ago

SDJ, Inc., has net working capital of $2,060, current liabilities of $5,550, and inventory of $1,250.

Business

1 answer:

alexandr1967 [171]3 years ago

6 0

Answer:

Current ratio = 1.37 times

Quick Ratio = 1.15 times

Explanation:

The current ratio and quick ratios both are measures to assess the liquidity position of businesses. These are useful indicators of how well the business is equipped to meet its current obligations using its liquid assets.

To calculate these ratios, we must first determine the value of current assets. We are given the value of net working capital. The net working capital is the difference between the current assets and the current liabilities.

Net Working capital = Current assets - Current Liabilities

2060 = Current Assets - 5550

2060 + 5550 = Current Assets

Current assets = $7610

Requirement 1.

The current ratio is calculated as follows,

Current Ratio = Current Assets / Current Liabilities

Current ratio = 7610 / 5550

Current Ratio = 1.3711 rounded off to 1.37 times

Requirement 2.

The quick ratio is calculated as follows,

Quick Ratio = (Current Assets - Inventories) / Current Liabilities

Quick Ratio = (7610 - 1250) / 5550

Quick Ratio = 1.1459 rounded off to 1.15 times

You might be interested in

Blue Spruce Manufacturing has an annual capacity of 80,200 units per year. Currently, the company is making and selling 78,000 u

Aliun [14]

Answer:

The annual capacity is 85000 units. If order is accepted of 12000 units the company will be able to sell only 73000 units (instead of 78000).

Explanation:

Current Net Income calculation and New Net Income calculation are atteched in the archive.

Increase in income = new income – old income = 370000 – 340000 = $30000

Marston’s Net Income will INCREASE by $30,000 if it accepts the special order.

The above increase can be also understood as---

Contribution gain on special order – 12000 units x ($105-$90) = $180,000

(-) Contribution lost of normal sale – (78000 units – 73000 units) x ($120-$90) = $150000

Net INCREASE = 180000 – 150000 = $30,000

Download xlsx

3 0

3 years ago

The term "percentage-above-the-nut" refers to

ASHA 777 [7]

Answer:

c. the profit that the theatre chain will make above its break-even point

Explanation:

Like every business, theatres and theatre chains have cost too, and they have to operate with a profit. After reaching the break-even point (nut), the theatre is covering all of its costs. Every dollar of revenue "above the nut" is a profit.

Subsequently, the theatre's management decides how to distribute the profit, having in mind various stakeholders (distribution firms, exhibition firms...).

7 0

4 years ago

Using an existing brand name to introduce a product that is new to the company into a totally new, unfamiliar product category s

lara31 [8.8K]

Answer: brand extension

Explanation: Brand extension refers to a marketing strategy which involves a well-known, developed and popular brand who has enjoyed continuous success in a particular market aims to delve into another area of the market or totally different product category using the same brand name.

In the scenario above, Colgate, a household name in toothpaste manufacturing decided to launch the Colgate kitchen entree which an entirely different market domain. The innovation strategy wasn't successful as it got consumers confused who saw them as developers iating from their original domain. Even though Colgate's intention was to use their existing popularity to extend their brand.

7 0

3 years ago

The problem of pollution typically arises in ____ economies around the world

Lerok [7]

In high or low income economies around the world.

6 0

3 years ago

In economic duress cases the courts look of the_?_ and the victim's alternatives.

cupoosta [38]

Answer: In economic duress cases the courts look of

the threats and the victim's alternatives.

Explanation:

Duress means where violence is used against the party to forcefully receive signatures of approval on written contract. The violence used can be unlawful threats or coercive behavior without which the person may not agree to commit to. If the pressure given is lawful it does not mean the economic duress is lawful.

Duress is an illegal act which is punishable under law. The court will check if the party had any threat. Also the court will check if the victim had any alternatives such as protesting at that time or the victim has affirmed the contract.

4 0

4 years ago