Rotorua Products, Ltd., of New Zealand markets agricultural products for the burgeoning Asian consumer market. The company’s current assets, current liabilities, and sales over the last five years (Year 5 is the most recent year) are as follows:
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||||||||||
Sales | $ | 1,800,000 | $ | 1,980,000 | $ | 2,070,000 | $ | 2,160,000 | $ | 2,250,000 | |||||
Cash | $ | 50,000 | $ | 65,000 | $ | 48,000 | $ | 40,000 | $ | 30,000 | |||||
Accounts receivable, net | 300,000 | 345,000 | 405,000 | 510,000 | 570,000 | ||||||||||
Inventory | 600,000 | 660,000 | 690,000 | 720,000 | 750,000 | ||||||||||
Total current assets | $ | 950,000 | $ | 1,070,000 | $ | 1,143,000 | $ | 1,270,000 | $ | 1,350,000 | |||||
Current liabilities | $ | 400,000 | $ | 440,000 | $ | 520,000 | $ | 580,000 | $ | 640,000 | |||||
Required:
1. Express all of the asset, liability, and sales data in trend percentages. Use Year 1 as the base year.
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