90.2K

Verified Solution

Link Copied!

P 6-11 A partial balance sheet and income statement for King Corporation follow:

KING CORPORATION

Partial Balance Sheet

Assets December 31, 2011

Current assets:

Cash $ 33,493

Marketable securities 215,147

Trade receivables, less allowance of $6,000 255,000

Inventories, LIFO 523,000

Prepaid expenses 26,180

Total current assets $1,052,820

Liabilities

Current liabilities:

Trade accounts payable $ 103,689

Notes payable (primarily to banks) and commercial paper 210,381

Accrued expenses and other liabilities 120,602

Income taxes payable 3,120

Current maturities of long-term debt 22,050

Total current liabilities $ 459,842

KING CORPORATION

Partial Income Statement

For Year Ended December 31, 2011

Net sales $3,050,600

Miscellaneous income 45,060

$3,095,660

Costs and expenses:

Cost of sales $2,185,100

Selling, general, and administrative expenses 350,265

Interest expense 45,600

Income taxes 300,000

2,880,965

Net income $ 214,695

Note: The trade receivables at December 31, 2010, were $280,000, net of an allowance of

$8,000, for a gross receivables figure of $288,000. The inventory at December 31, 2010, was

$565,000.

(continued

a. Working capital

b. Current ratio

c. Acid-test ratio

d. Cash ratio

e. Days sales in receivables

f. Accounts receivable turnover in days

g. Days sales in inventory

h. Inventory turnover in days

i. Operating cycle

Answer & Explanation Solved by verified expert

See Answer