MBA560 Financial and Managerial Accounting: Module 5 Test Problem 1 - Barnhart Company

MBA560 Financial and Managerial Accounting
Module 5 Test Problem 1.
The following information applies to Barnhart Company:
Assets
Cash 5,000
Accounts Receivable 12,000
Inventory 15,000
Plant and equipment, net of depreciation 20,000
Land 18,000
Total Assets 70,000
Liabilities & Stockholders' Equity
Accounts payable 4,000
Salaries payable 9,000
Bonds payable (due 2020) 11,000
Capital stock, 20 no par 22,000
Retained earnings 24,000
Total Liabilities & Stockholders' Equity 70,000
Additional information:
Net Credit Sales = $220,000
Beginning Accounts Receivable = $10,000

Required:
1) Compute Barnhart's:
a) Quick ratio
b) Current ratio
c) Working capital
d) Accounts receivable turnover
e) Average days to collect receivables
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