Question

Cullumber Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income...

Cullumber Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income statement for 2015 and 2016 follow.
Cullumber Medical
Comparative Balance Sheet
As of December 31
2016 2015
Assets
Current assets
  Cash $397,000 $417,450
  Accounts receivable, net 1,089,000 776,400
  Inventory 733,000 681,050
  Other current assets 381,400 247,100
Total current assets 2,600,400 2,122,000
Property, plant, & equipment, net 8,616,245 8,439,830
  Total assets $11,216,645 $10,561,830
Liabilities and Stockholders’ Equity
Current liabilities $3,156,000 $2,846,050
Long-term debt 3,702,600 3,892,600
  Total liabilities 6,858,600 6,738,650
Preferred stock, $5 par value 58,900 58,950
Common stock, $0.25 par value 104,650 103,850
Retained earnings 4,194,495 3,660,380
  Total stockholders’ equity 4,358,045 3,823,180
  Total liabilities and stockholders’ equity $11,216,645 $10,561,830
Cullumber Medical
Comparative Income Statement and Statement of Retained Earnings
For the Year
2016 2015
Sales revenue (all on account) $10,177,300 $9,613,950
Cost of goods sold 5,612,300 5,298,700
  Gross profit 4,565,000 4,315,250
Operating expenses 2,840,250 2,634,200
Net operating income 1,724,750 1,681,050
Interest expense 300,300 308,650
Net income before taxes 1,424,450 1,372,400
Income taxes (30%) 427,335 411,720
Net income $997,115 $960,680
Dividends paid
  Preferred dividends 29,550 29,500
  Common dividends 433,450 413,100
  Total dividends paid 463,000 442,600
Net income retained 534,115 518,080
Retained earnings, beginning of year 3,660,380 3,142,300
Retained earnings, end of year $4,194,495 $3,660,380

(a-d)

Calculate the following liquidity ratios for 2016. (If working capital is negative then enter with a negative sign preceding the number or parentheses, e.g. -15,000 or (15,000). Round all answers except working capital to 2 decimal places, e.g. 2.55.)
a. Working capital $
b. Current ratio
c. Acid-test ratio
d. Accounts receivable turnover times
Click if you would like to Show Work for this question:

Homework Answers

Answer #1

For 2016

a. Total current assets = $2,600,400

Total current liabilities = $3,156,000
working capital = Total current assets- Total current liabilities

= 2,600,400-3,156,000

= -$555,600

b.

Current ratio = Total current assets/ Total current liabilities

= 2,600,400/3,156,000
= 0.82

c.

Acid test ratio = ( Cash + Accounts receivable)/Current liabilities

= (397,000+1,089,000)/3,156,000
= 1,486,000/3,156,000

= 0.47

d.

Average accounts receivable = (Beginning accounts receivable+ Ending accounts receivable)/2

= (776,400+1,089,000)/2

= $932,700

Accounts receivable turnover = Sales / Average accounts receivable

= 10,177,300/932,700

= 10.91

a. Working capital -$555,600
b. Current ratio 0.82
c. Acid-test ratio 0.47
d. Accounts receivable turnover 10.91 times
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Cullumber Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income...
Cullumber Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income statement for 2015 and 2016 follow. Cullumber Medical Comparative Balance Sheet As of December 31 2016 2015 Assets Current assets   Cash $397,000 $417,450   Accounts receivable, net 1,089,000 776,400   Inventory 733,000 681,050   Other current assets 381,400 247,100 Total current assets 2,600,400 2,122,000 Property, plant, & equipment, net 8,616,245 8,439,830   Total assets $11,216,645 $10,561,830 Liabilities and Stockholders’ Equity Current liabilities $3,156,000 $2,846,050 Long-term debt 3,702,600 3,892,600...
Exercise 12-10 Your answer is partially correct. Try again. Oriole Medical manufactures hospital beds and other...
Exercise 12-10 Your answer is partially correct. Try again. Oriole Medical manufactures hospital beds and other institutional furniture. The company’s comparative balance sheet and income statement for 2015 and 2016 follow. Oriole Medical Comparative Balance Sheet As of December 31 2016 2015 Assets Current assets   Cash $357,000 $417,400   Accounts receivable, net 1,065,600 776,450   Inventory 729,000 681,050   Other current assets 386,000 247,000 Total current assets 2,537,600 2,121,900 Property, plant, & equipment, net 8,574,855 8,389,815   Total assets $11,112,455 $10,511,715 Liabilities and Stockholders’...
Oriole Medical Comparative Balance Sheet As of December 31 2016 2015 Assets Current assets Cash $357,000...
Oriole Medical Comparative Balance Sheet As of December 31 2016 2015 Assets Current assets Cash $357,000 $417,400 Accounts receivable, net 1,065,600 776,450 Inventory 729,000 681,050 Other current assets 386,000 247,000 Total current assets 2,537,600 2,121,900 Property, plant, & equipment, net 8,574,855 8,389,815   Total assets $11,112,455 $10,511,715 Liabilities and Stockholders’ Equity Current liabilities $3,123,000 $2,846,100 Long-term debt 3,702,650 3,892,700 Total liabilities 6,825,650 6,738,800 Preferred stock, $5 par value 53,900 53,900 Common stock, $0.25 par value 195,000 103,850 Retained earnings 4,037,905 3,615,165...
Here are comparative statement data for Cullumber Company and Oriole Company, two competitors. All balance sheet...
Here are comparative statement data for Cullumber Company and Oriole Company, two competitors. All balance sheet data are as of December 31, 2017, and December 31, 2016. Cullumber Company Oriole Company 2017 2016 2017 2016 Net sales $1,856,000 $596,000 Cost of goods sold 1,079,000 298,000 Operating expenses 263,000 83,000 Interest expense 7,000 2,800 Income tax expense 75,000 34,000 Current assets 590,015 $565,462 150,838 $ 143,835 Plant assets (net) 953,508 905,000 252,908 227,720 Current liabilities 120,048 137,225 63,980 54,809 Long-term liabilities...
Item 4A. Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance...
Item 4A. Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 31,000 $ 28,000 Accounts receivable 18,000 20,000 Inventory 58,000 56,000 Prepaid expenses 12,000 10,000 Total current assets 119,000 114,000 Property, plant, and equipment 374,000 354,000 Less accumulated depreciation 190,000 165,000 Net property, plant, and equipment 184,000 189,000 Total assets $ 303,000 $ 303,000 Liabilities and stockholders' equity: Current liabilities: Accounts payable $ 13,000 $ 9,000 Accrued...
Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash...
Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year Assets Current assets: Cash $ 1,280 $ 1,560 Accounts receivable, net 12,300 9,100 Inventory 9,700 8,200 Prepaid expenses 1,800 2,100 Total current assets 25,080 20,960 Property and equipment: Land 6,000 6,000 Buildings and equipment, net 19,200 19,000 Total property and equipment 25,200 25,000 Total assets $ 50,280 $ 45,960 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 9,500 $ 8,300 Accrued liabilities 600 700 Notes payable, short...
A comparative balance sheet and income statement is shown for Cruz, Inc. CRUZ, INC. Comparative Balance...
A comparative balance sheet and income statement is shown for Cruz, Inc. CRUZ, INC. Comparative Balance Sheets December 31, 2015 2015 2014 Assets Cash $ 94,800 $ 24,000 Accounts receivable, net 41,000 51,000 Inventory 85,800 95,800 Prepaid expenses 5,400 4,200 Total current assets 227,000 175,000 Furniture 109,000 119,000 Accum. depreciation—Furniture (17,000 ) (9,000 ) Total assets $ 319,000 $ 285,000 Liabilities and Equity Accounts payable $ 15,000 $ 21,000 Wages payable 9,000 5,000 Income taxes payable 1,400 2,600 Total current...
Use the balance sheet and income statement below: VALIUM’S MEDICAL SUPPLY CORPORATION Balance Sheet as of...
Use the balance sheet and income statement below: VALIUM’S MEDICAL SUPPLY CORPORATION Balance Sheet as of December 31, 2015 and 2014 (in thousands of dollars) 2015 2014 2015 2014 Assets Liabilities and Equity Current assets: Current liabilities: Cash and marketable securities $ 74 $ 73 Accrued wages and taxes $ 50 $ 43 Accounts receivable 191 183 Accounts payable 156 143 Inventory 316 293 Notes payable 133 133 Total $ 581 $ 549 Total $ 339 $ 319 Fixed assets:...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current...
Krech Corporation's comparative balance sheet appears below: Comparative Balance Sheet Ending Balance Beginning Balance Assets: Current assets: Cash and cash equivalents $ 31,000 $ 28,000 Accounts receivable 18,000 20,000 Inventory 58,000 56,000 Prepaid expenses 12,000 10,000 Total current assets 119,000 114,000 Property, plant, and equipment 374,000 354,000 Less accumulated depreciation 190,000 165,000 Net property, plant, and equipment 184,000 189,000 Total assets $ 303,000 $ 303,000 Liabilities and stockholders' equity: Current liabilities: Accounts payable $ 13,000 $ 9,000 Accrued liabilities 52,000...
Following are partially completed financial statements​ (income statement, statement of retained​ earnings, and balance​ sheet) for...
Following are partially completed financial statements​ (income statement, statement of retained​ earnings, and balance​ sheet) for Loving Corporation. Complete the financial statements. All amounts are in millions. Loving Corporation Income Statement Year Ended December 31, 2018 (millions) Net sales $186 Expenses 106 Net income (loss) $ a Loving Corporation Statement of Retained Earnings Year Ended December 31, 2018 (millions) Beginning retained earnings $72 Net income b Cash dividends declared (9) Ending retained earnings $ c Loving Corporation Balance Sheet December...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT