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rjkz [21]
3 years ago
6

Ace Industries has current assets equal to $3 million. The company's current ratio is 1.5, and its quick ratio is 1.1. What is t

he firm's level of current liabilities? What is the firm's level of inventories? Do not round intermediate calculations. Round your answers to the nearest dollar. Current liabilities: $ 2000000 Inventories:
Business
1 answer:
Mekhanik [1.2K]3 years ago
5 0

Answer:

Current Liabilities = $2000000

Inventories = $800000

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 most liquid assets.

The current ratio is calculated as follows,

Current Ratio = Current Assets / Current Liabilities

The quick ratio is calculated as follows,

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

To calculate the inventory level, we must first determine the value of current liabilities using the current ratio.

1.5 = 3000000 / Current Liabilities

Current Liabilities = 3000000 / 1.5

Current Liabilities = $2000000

Using the quick ratio, we can calculate the level of inventories.

1.1 = (3000000 - Inventories) / 2000000

1.1 * 2000000 = 3000000 - Inventories

2200000 = 3000000 - Inventories

Inventories = 3000000 - 2200000

Inventories = $800000

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Jacobs Company has inventory of 15 units at a cost of $12 each on June 1. On June 5, Jacobs purchased 10 units at $13 per unit.
vekshin1

Answer:

$210

Explanation:

Date    Description   Units  Price  Total Balance

1-Jun    Opening        15   $12   $180   $180  

5-Jun    Purchase      10      $13     $130          $310  

12-Jun   Purchase      20     $14     $280         $590  

17-Jun   *Sale             -30               -$380        $210  

*Working

Sale

Date          Units   Price     Total

17-Jun       -15 $12   $(180)  

                -10   $13   $(130)  

                -5   $14   $(70)  

Total Sale -30           -$380  

So, the correct answer is $210.

3 0
3 years ago
Stockmaster Corporation has two manufacturing departments--Forming and Assembly. The company used the following data at the begi
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Answer:

Explanation:

Forming

Estimated fixed manufacturing overhead  $27,000

Estimated variable manufacturing overhead ($1.10*5,000)  $5,500

Estimated total manufacturing overhead cost  $32,500

Assembly

Estimated fixed manufacturing overhead  $10,500

Estimated variable manufacturing overhead ($2.80 × 5,000)  14,000

Estimated total manufacturing overhead cost  $24,500

Now we need to add these two numbers ($32,500 + $24,500 = $57,000) in order to identify plantwide predetermined manufacturing overhead rate

Estimated total manufacturing overhead cost  $57,000

Estimated total machine hours  10,000

Predetermined overhead rate  $5.70  [57,000/10,00]

The overhead applied to Job C:

Overhead applied to job C = Predetermined overhead rate x Machine-hours incurred by C

= $5.70 * (3,400 + 2,000)

= $5.70 x (5,400)

= $30,780

Job C’s manufacturing cost:

Direct materials  $11,200

Direct labor cost  $21,900

Manufacturing overhead $30,780

Total manufacturing cost  $63,880

The selling price for Job C:

Total manufacturing cost  $63,880

Markup (40%)  25,552

Selling price  $89,432

 

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Answer:

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