Requlred Informetlon [The following information applies to the questions display
ID: 2338609 • Letter: R
Question
Requlred Informetlon [The following information applies to the questions displayed below. Simon Company's year-end balance sheets follow. Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets $ 27,862 $31,634 $ 31,672 54, 18e 59,88e 3,519 62,788 82,58e 8, 384 288,449 198,764 89,680 111,58e 8,715 445, 326 383,982 $318,68e Liabilities and Equity Accounts payable Long- $114,213 66,826 $ 42,229 term notes payable secured by mortgages on plant assets Common stock, $19 par value Retained earnings Total liabilities and equity 86, 233 82,388 $ 445,326 98,946 162,580 162, 58e 63,630 383,992 7e, 782 162, 58e 35,169 318,680 $. The company's income statements for the years ended December 31, 2017 and 2016, follow. Assume that all sales are on credit: For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income taxes Total costs and expenses Net income 2817 2816 $578,924 456,843 353,144 179,466 9,842 7,526 $296,948 115, 581 18,587 6,853 549,978 e 429,889 $26,954 1.66 $ 28,946 Earnings per share 1.78 (2) Compute accounts receivable turnover Accounts Receivable Turnover Choose Accounts Receivable Turnover Accounts receivable turnover imes imes 2017 2016Explanation / Answer
Working note
Calculation of Average Accounts receivable
2016
2017
(A)
Beginning Accounts Receivable
$ 54,100.00
$ 62,700.00
(B)
Ending Accounts Receivable
$ 62,700.00
$ 89,600.00
C= (A+B)
Total
$ 116,800.00
$ 152,300.00
(C/2)
Average Accounts receivable
$ 58,400.00
$ 76,150.00
Answer
Accounts Receivable Turnover
Choose Numerator
/
Choose denominator
=
Accounts Receivable Turnover
Net credit sales
/
Average Accounts Receivables
=
2017
$ 578,924.00
/
$ 76,150.00
=
7.60
times
2016
$ 456,843.00
/
$ 58,400.00
=
7.82
times
Calculation of Average Accounts receivable
2016
2017
(A)
Beginning Accounts Receivable
$ 54,100.00
$ 62,700.00
(B)
Ending Accounts Receivable
$ 62,700.00
$ 89,600.00
C= (A+B)
Total
$ 116,800.00
$ 152,300.00
(C/2)
Average Accounts receivable
$ 58,400.00
$ 76,150.00
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