Answer:
The current ratio is 1.18 times
Explanation:
Current Ratio: The current ratio is that ratio which shows a relationship between the current assets and the current liabilities
The computation of the current ratio is shown below
Current ratio = Total Current assets ÷ total current liabilities
where,
Total current assets = Cash + short-term investments + net accounts receivable + merchandise inventory
= $43,500 + $27,000 + $102,000 + $125,000
= $297,500
And, the total current liabilities is $251,000
Now put these values to the above formula
So, the ratio would equal to
= $297,500 ÷ $251,000
= 1.18 times
The long term note payable is not a current liabilities,hence it is not considered in the computation part.
Answer:
Capitalized Expenditures:
2. Added a new wing onto the office building.
5. Had an engine rebuilt in one of their fleet cars.
Explanation:
Capitalization is the process of delaying the full recognition of an expense for the acquisition of a new asset with long-term life so that the costs can be treated as an expense gradually over its useful life through an accounting method known as depreciation or amortization.
The criteria for capitalizing expenditure depend on whether the expenditure is necessary to bring the asset to the condition and location where it can be operated as desired by the management. It must also meet the threshold amount set by management for capitalization. This is because some assets can be used for more than one year and still they are not regarded as capital assets. Example is a stapling machine that costs less than a dollar.
The fritolay, a standalone division of pepsico may be classified as a revenue center. A revenue center is a separate operating division of a company that is in charge of producing sales. For instance, a department shop might view each of its departments as a revenue center, including men's, women's, and children's clothing, jewellery, and so forth.
The sole thing that cost centers do, like revenue centers, is monitor costs, making them the revenue center's opposite. Revenue centers are marketing departments that are immune from profit generation and responsibility because they solely measure production. The business activity in charge of producing a company's sales revenue is known as a revenue center.
To learn more about revenue center, click here.
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Answer:
The answer is: Cash and marketable securities $5,406,393
Explanation:
We have:
+ Current ratio = Current asset / Current liabilities = 2; with Current liabilities is given at $8 million => Current asset is $16 million;
+ Current asset = Inventory + Account Receivable + Cash and marketable securities <=> Cash and marketable securities = $16 million - Inventory - Account Receivable ( as current asset is calculated above at $16 million)
+ Average collection period = Account Receivable/ Credit Sales x 365 <=> Account Receivable = Average collection period/365 x Credit sales = 30/365 x 64 million = $5,260,274
+ Inventory turnover = Sales / Inventory <=> Inventory = Sales/ Inventory turnover = 64 million / 12 = $5,333,333
=> Cash and marketable securities = 16,000,000 - 5,333,333 - 5,260,274 = $5,406,393.
