Prepare a statement of cash flows for the year ended 2021, using the indirect method. 33. Boyle Corporation had the foll
Posted: Sun Jul 03, 2022 1:22 pm
Prepare a statement of cash flows for the year ended 2021, usingthe indirect method.
33. Boyle Corporation had the following comparative currentassets and current liabilities:
Dec. 31, 2021 Dec. 31, 2020
Currentassets
Cash $ 60,000 $ 30,000
Short-terminvestments 40,000 10,000
Accountsreceivable 55,000 95,000
Inventory 110,000 90,000
Prepaidexpenses 35,000 20,000
Total currentassets $300,000 $245,000
Currentliabilities
Accountspayable $140,000 $110,000
Salariespayable 40,000 30,000
Income taxpayable 20,000 15,000
Total currentliabilities $200,000 $155,000
During 2021, credit sales and cost of goods sold were $750,000and $400,000, respectively.
Instructions
Compute the following liquidity measures for 2021 and brieflydescribe what they tell you about Boyle Corporation:
1. Current ratio.
2. Working capital.
3. Acid-test ratio.
4. Receivables turnover.
5. Inventory turnover.
33. Boyle Corporation had the following comparative currentassets and current liabilities:
Dec. 31, 2021 Dec. 31, 2020
Currentassets
Cash $ 60,000 $ 30,000
Short-terminvestments 40,000 10,000
Accountsreceivable 55,000 95,000
Inventory 110,000 90,000
Prepaidexpenses 35,000 20,000
Total currentassets $300,000 $245,000
Currentliabilities
Accountspayable $140,000 $110,000
Salariespayable 40,000 30,000
Income taxpayable 20,000 15,000
Total currentliabilities $200,000 $155,000
During 2021, credit sales and cost of goods sold were $750,000and $400,000, respectively.
Instructions
Compute the following liquidity measures for 2021 and brieflydescribe what they tell you about Boyle Corporation:
1. Current ratio.
2. Working capital.
3. Acid-test ratio.
4. Receivables turnover.
5. Inventory turnover.