The financial information below presents selected information from the financial

Question

The financial information below presents selected information from the financial statements of Pelican Company. Sales revenue during the current year was $13,340,300 and cost of goods sold was $8,914,195. All of Pelican's sales are made on account and are due within 30 days.

Current ratios as of the end of the current and prior year. (Round your answers to 2 decimal places.)

Calculate the receivables turnover ratio for the current year. (Round your answer to 2 decimal places.)

The financial information below presents selected information from the financial statements of Pelican Company. Sales revenue during the current year was $13,340,300 and cost of goods sold was $8,914,195. All of Pelican's sales are made on account and are due within 30 days.

Explanation / Answer

Prior Year Current Year   Cash and cash equivalents $ 570,330 $ 635,780   Accounts receivable 4,730,000 3,818,000   Inventory 938,360 1,277,440   Total current assets 8,250,030 8,210,100   Total assets 11,118,020 10,998,000   Total current liabilities 7,830,300 6,306,000   Total liabilities 8,467,900 8,276,700 A Current Ratio = Current Assets / Current Liabilities Prior Year Current Year Current Assets 8,250,030 8,210,100 Current Liabilities 7,830,300 8,276,700 Current Ratio             1.05           0.99 B Receivable Turnover Ratio = Net Credit Sale/Avg Accounts receivable Avg Accounts receivable = (Opening Account Receivable+Closing Current eceivable)/2 =(4730000+3818000)/2 = 4274000$ Receivable Turnover Ratio = Net Credit Sale/Avg Accounts receivable =$13340300/4274000 =3.12 C Days to collect ratio = Average accounts receivable Annual sales ÷ 365 days = $4,274,000 *365 $13,340,300 =               32.04 days D Inventory Turnover = Cost of Goods Sold / Average Inventory Avg Inventory = (Opening Inventory +Closing Inventory )/2 =(938360+1277440)/2 1107900 $ Inventory Turnover = Cost of Goods Sold / Average Inventory =8914195/1107900                                                          8.05 E the days to sell for the current year. = Ending Inventory/Cogs*365 =1277440/8914195*365               52.31

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.