Question

hes385r3_Financial_Performance_Worksheet_Week_4 Review View AutoSave OFF A S Home Insert DrawPage Layout Times New Roman 12 Paste BIV A B4 X v fx BALANCE SHEET Comments Formulas A A Q-Search Sheet Share EAY- O 4 Data = = 2 Wrap Text Merge & Center General $ % 3 E 48 2X Delete Format Sort & Filter Find A Select ideas Sensitivity Formatting as Table X Styles Hillside, Inc. BALANCE SHEET Sin millions) INCOME STATEMENT ($ in millions) 4490 1.611.20 Cash & M e Securities Not Receivable LIABILITIES Acants Payable Salaries Payable Other Cunni Total Current Libilities Rev Cost Of Goods Sold Gross Poodit 28,681.10 20,768. 7,912.30 10 11 2955,20 Other Canon Assets Total Cunt Assets 5.166.50 13 C asting Selline Conna Admin Depreciation Opening income Other Llabilities 693.40 307.30 1.634.20 Machinery & Equipment Totallisbilities Buildings 2.148.40 (575.60) Other Exp (Income 17 18 19 (13.10 1,637.30 Depreciation Property, Plant & Equip - Net Other Long Term Assets Total Long Tam Assets SHAREHOLDER'S EQUITY Common Stock Retained Emines Total Sheldor's Equity Income Tarses 120.90 4.712.30 Nelaine L019.20 Total Assets Total Liabilities & Equity Number of Cowo Stock Share Oastanding Financial Performs Summary LIQUIDITY RATIOS 30 Quick Ratio (times) Average Payment Period (days) 33 ASSET MANAGEMENT RATIOS Total Asset T over times) ge Collection Period (day) Inventary Tumover times) A 38 39 FINANCIAL LEVERAGE RATIOS Total Debt to Total Assets Equity Multiplier times) 41 13 PROFITABILITY RATIOS Operating Profil Marzin Net Profit Main Ramon Total Assets Reum on Equity Emmings por Share Problem for Students + # C - + 100%

What would be my answer for the liquidity ratios The first blue box?

Answer 1

Current ratio = Current assets / Current liabilities

Current assets = $5166.5, Current liabilities = $2955.2

Current ratio = $5166.5 / $2955.2 = 1.75

Quick ratio = Current assets - Inventories - other current assets / Current liabilities

Current assets = $5166.5, Current liabilities = $2955.2, Inventories = $3645.2, Other current assets = $116.6

Quick ratio = ($5166.5 - $3645.2 - $116.6) / $2955.2

Quick ratio = $1404.7 / $2955.2 = 0.48

Average payment period = 365 / Accounts payable turnover ratio

First we will calculate the accounts payable turnover ratio, as per below:

Accounts payable turnover ratio = Purchases or Cost of the goods sold / Accounts payable

(Assuming that purchases are equal to cost of the goods sold here)

Accounts payable = $1611.2, Cost of the goods sold = $20768.8

Accounts payable turnover ratio = $20768.8 / $1611.2 = 12.89

Now, we will calculate the average payment period as per below:

Average payment period = 365 / Accounts payable turnover ratio

Average payment period = 365 / 12.89 = 28.31 days.