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3241004551 [841]
2 years ago
5

Nordstrom, Inc. operates department stores in numerous states. Suppose selected financial statement data (in millions) for 2020

are presented below. End of Year Beginning of Year Cash and cash equivalents $ 1,285 $ 122 Accounts receivable (net) 3,500 3,300 Inventory 1,500 1,500 Other current assets 555 515 Total current assets $6,840 $5,437 Total current liabilities $3,420 $2,722 For the year, net credit sales were $13,940 million, cost of goods sold was $9,000 million, and net cash provided by operating activities was $1,254 million. Compute the current ratio, accounts receivable turnover, average collection period, inventory turnover, and days in inventory at the end of the current year. (Round answers to 1 decimal place, e.g. 1.6.)
Business
1 answer:
ivann1987 [24]2 years ago
3 0

Answer:

a. Current ratio = Total current assets/Total current liabilities

Current ratio = $6,840/$3,420

Current ratio = 2 : 1

b. Accounts receivable turnover = Net credit sales / [Net beginning accounts receivables + Net ending accounts receivables / 2]

Accounts receivable turnover = $13,940 / [$3,300+$3,500/2]

Accounts receivable turnover = $13,940 / $3,400

Accounts receivable turnover = 4.1 times

c. Average collection period = 365 / Accounts receivables turnover

Average collection period = 365 / 4.1

Average collection period = 89.0244

Average collection period = 89 days

d. Inventory turnover = Cost of goods sold / [Beginning inventory+Ending inventory/2]

Inventory turnover = $9,000 / [$1,500+$1,500/2]

Inventory turnover = $9,000 / $1,500

Inventory turnover = 6 times

e. Days in inventory at the end of the current year = 365 / Inventory turnover

Days in inventory at the end of the current year = 365 / 6

Days in inventory at the end of the current year = 60.8333

Days in inventory at the end of the current year = 61 days

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Flint Inc. issued $3,790,000 of 10%, 10-year convertible bonds on June 1, 2020, at 99 plus accrued interest. The bonds were date
gulaghasi [49]

Answer:

A. Dr Interest Payable $63,167

Dr Interest expense $127,617

Cr Discount on Bonds payable $1,284

Cr Cash $189,500

B. Dr Bonds payable $1,421,250

Cr Discount on Bonds payable $13,008

Cr Common Stock $612,000

Cr Paid-in capital in excess of par- Common Stock $796,242

Explanation:

(a) Preparation of the entry to record the interest expense at October 1, 2020. Assume that accrued interest payable was credited when the bonds were issued.

Dr Interest Payable $63,167

[($3,790,000*.10)/2*(2/6)]

Dr Interest expense $127,617

[($3,790,000*.10)/2*(4/6) + $1,284]

Cr Discount on Bonds payable $1,284

($321*4)

Cr Cash $189,500

[ ( $3,790,000*.10)/2]

(To record interest expense at October 1, 2020.)

Calculation for the discount per month

First step is to calculate the remaining months

Months remaining= (10 years *12-2)

Months remaining=118 months

Second step is to calculate the Total discount

Total Discount= $3,790,000-($3,790,000*.99)

Total discount=$3,790,000-$3,752,100

Total discount=$37,900

Now let calculate the discount per month

Discount per month=($37,900/118)

Discount per month=$321

(b) Preparation of the entry to record the conversion on April 1, 2021

Dr Bonds payable $1,421,250

Cr Discount on Bonds payable $13,008

Cr Common Stock $612,000

(34,000*$18)

Cr Paid-in capital in excess of par- Common Stock $796,242

[$1,421,250-($13,008+$612,000)]

(To record conversion of bond into 34,000 shares.)

Calculation for Unamortized bond discount

Discount of the bonds $14,213

($37,900*(3/8))

Less Discount amortized ($1,205)

[($37,900/118)*10 years*(3/8)]

Unamortized bond discount $13,008

($14,213-$1,205)

8 0
3 years ago
what is the present value of a deferred perpetuity that pays $141 annually with the first payment occurring at year 5? assume th
yKpoI14uk [10]

The present value of a deferred perpetuity is $1,938.89.

What is present value?
The present value of a prospective sum of money or cash flow stream given a specified return rate is known as its present value (PV). The present value of future cash flows is reduced by the discount rate, and the higher coupon rate, the lower the present value of future cash flows. The key to correctly valuing future cash flows, whether they are earnings or debt obligations, is determining the appropriate discount rate. The concept of present value states that a quantity of funds today is worth greater than the same amount in the long term. In other words, money gained in the long term is not as valuable as money received today.

The present value of a deferred perpetuity that pays $141 annually with the first payment occurring at year 5 is $1,938.89. This can be calculated by taking the present value of an ordinary annuity formula, which is PV = A / (1 + r)^n, and adding 5 to n. This gives the equation PV = A / (1 + r)^(n + 5), which can be simplified to PV = A / (1 + r)^n * (1 + r)^5. Thus, the present value is $141 / (1 + 0.06)^10 * (1 + 0.06)^5, which equals $1,938.89.

To learn more about present value
brainly.com/question/20813161
#SPJ4

3 0
1 year ago
It is crucial to understand the various factors contributing to your employees' stress as well as the consequences of it. Catego
Rus_ich [418]

Explanation:

A. Environmental Sources of Stress:

It is the stressors arising from environmental factors that can threaten the employee's work in some way.

2- Economic uncertalinty

5- Technological change

B. Organizational Sources of Stress:

This stress derives from internal or external conflicts that can occur at work, such as personal charges and poor relationships with other employees.

1. Task demands

4. Interpersonal demands

C. Personal Sources of Stress:

These are the stressors arising from the employee's personal life, which can directly impact the quality with which the employee performs his work.

3. Economic problems

6. Family problems

3 0
3 years ago
Which of the following countries experienced a decline in total output from 2000 to 2005?
sattari [20]

Answer: The correct answer is "B. Zimbabwe".

Explanation: GDP growth is crucial for an economy, since an increase in it reflects an increase in economic activity. If economic activity picks up, it means that unemployment tends to decrease and that per capita income increases.

In the case of Zimbabwe, population growth is far superior to GDP growth, therefore this makes economic growth much more difficult since there are more people per capita income is diminished.

7 0
3 years ago
Which of the following is a correct formula when markup is based on selling price
oksano4ka [1.4K]
<span>perhaps u want the formula for the percentage of markup, giving the cost and selling price.
..(selling price) = (cost) + (Markup)
..(selling price) - (cost) = (markup)
so,
..(markup)/(selling price)*100% = ((selling price) - (cost))/(selling price) * 100%
.. =(1 -(cost)/(selling price))*100%

</span>
5 0
3 years ago
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