Weygandt, Accounting Principles, 12e Assignment Gradebook ORION Downloadable eTe

Question

Weygandt, Accounting Principles, 12e Assignment Gradebook ORION Downloadable eTextbook ice ment Problem 18-5A Selected financial data of Target Corporation and Wal-Mart Stores, Inc. for a re Target Corporatlon Income Statement Data for Year Wal-Mart Stores, Inc. Net sales Cost of goods sold Selling and administrative expenses Interest expense Other income (expense) Income tax expense Net income $61,471 41,895 16,200 647 1,896 1,776 $ 2,849 $374,526 286,515 70,847 1,798 4,273 6,908 s 12,731 Balance Sheet Data (End of Year) Current assets Noncurrent assets Total assets Current liabilities Long-term debt Total stockholders' equity Total liabilities and stockholders' equity $18,906 25,654 $44,560 $11,782 17,471 15,307 $44,560 47,585 115,929 $163,514 s 58,454 40,452 64,608 $163,514 Beainnina-of-Year Balances Privasy Polisx Ail Rights Reserved. A Division of loho WieY &5002 os ?

Explanation / Answer

Part 1:

For Target:

Current Ratio = Current Assets / Current Liabilities
Current Ratio = $18,906 / $11,782
Current Ratio = 1.6 : 1

For Wal-Mart:

Current Ratio = Current Asset / Current Liabilities
Current Ratio = $47,585 / $58,454
Current Ratio =0.8 :1

Part 2:

For Target:

Accounts Receivable Turnover = Sales / Average Net Accounts Receivable
Accounts Receivable Turnover = $61,471 / $7,124
Accounts Receivable Turnover = 8.6 times

For Wal-Mart:

Accounts Receivable Turnover = Sales / Average Net Accounts Receivable
Accounts Receivable Turnover = $374,526 / $3,247
Accounts Receivable Turnover = 115.3 times

Part 3:

For Target:

Average Collection Period = 365 days / Accounts Receivable Turnover
Average Collection Period = 365 days / 8.6
Average Collection Period = 42.4 days

For Wal-Mart:

Average Collection Period = 365 days / Accounts Receivable Turnover
Average Collection Period = 365 days / 115.3
Average Collection Period = 3.2 days

Part 4:

For Target:

Inventory Turnover = COGS / Average Inventory
Inventory Turnover = $41,895 / $6,517
Inventory Turnover = 6.4 times

For Wal-Mart:

Inventory Turnover = COGS / Average Inventory
Inventory Turnover = $286,515 / $34,433
Inventory Turnover = 8.3 times

Part 5:

For Target:

Days in Inventory = 365/ Inventory Turnover
Days in Inventory = 365/ 6.4
Days in Inventory = 57.0 days

For Wal-Mart:

Days in Inventory = 365/ Inventory Turnover
Days in Inventory = 365/ 8.3
Days in Inventory = 44.0 days

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