Blog

The debt ratio helps to assess the risk a company has of failing to pay its debts and is helpful to both its owners and creditors.

Measures taken from a selected competitor or a group of competitors are often excellent standards of comparison for analysis.

The higher the accounts receivable turnover, the less quickly accounts receivable are collected.

Current assets divided by current liabilities is the:

The purchase of supplies on credit should be recorded with a debit to Supplies and a credit to Accounts Payable.

Refer to the following selected financial information from Elvis Corp. Compute the company’s inventory turnover for Year 2.    Year 2   Year 1   Merchandise inventory 271,000   253,500   Cost of goods sold 486,400   433,100  

When preparing the operating activities section of the statement of cash flows using the indirect method, expenses with no cash outflows are added back to net income.

Risk is the uncertainty about the return we will earn.

In preparing a company’s statement of cash flows for the most recent year, the following information is available:         Loss on the sale of equipment $ 14,000 Purchase of equipment   225,000 Proceeds from the sale of equipment   106,000 Repayment of outstanding bonds   87,000 Purchase of treasury stock   25,000 Issuance of common stock   96,000 Purchase of land   115,000 Increase in accounts receivable during the year   33,000 Decrease in accounts payable during the year   75,000 Payment of cash dividends   35,000 Net cash flows from investing activities for the year were:

The purchase of long-term assets by issuing a note payable for the entire amount is reported on the statement of cash flows in the: