Acct301 Devry Accounting: Week 3 Homework (2 Problems)

Acct301 Devry Accounting
Week 3 Homework

Problem 1

Required: Express each income statement component as a percentage of sales, and comment on the trends in each line from 2012 to 2013. (25 points)

Problem 2

Required: Compute (1) accounts receivable turnover for 2013, (2) the inventory turnover for 2013, and (3) the net margin for 2012. (25 points)
2013 2012
Balance sheet items
Accounts receivable $380,000.00 $376,000.00
Allowance for doubtful accounts $(20,000.00) $(16,000.00)
Net accounts receivable $360,000.00 $360,000.00
Inventory $480,000.00 $440,000.00

Income statement items
Sales $3,400,000.00 $3,080,000.00
Cost of goods sold $1,600,000.00 $1,440,000.00
Operating expenses $780,000.00 $680,000.00
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