Question Details

Boyle Corporation had the following comparative current assets 


Figure 16-3.
The current asset section of the balance sheets of the Shamrock Company as of June 30, 2014 and 2013 is presented below.

	2014	2013
Cash and cash equivalents	$     75,000	$     58,800
Trade accounts receivable, net	157,500	193,200
Inventory	208,200	253,400
Other current assets 	       18,400	       15,500
    Total current assets	$   459,100	$   520,900
Total assets	$2,650,000	$3,430,000

1.	Refer to Figure 16-3. In the spaces provided below, complete a horizontal analysis of the current asset section of Shamrock Company's balance sheet for 2013. Your answers for "% Change" should be rounded to one decimal place, e.g., 10.3%. Provide a short evaluation of this analysis.

	$ Change	% Change
		
		
		
		
2.	Boyle Corporation had the following comparative current assets and current liabilities:

	Dec. 31, 2014	Dec. 31, 2013
Current assets
	Cash	$  20,000	$  30,000
	Short-term investments	40,000	10,000
	Accounts receivable	55,000	95,000
	Inventory	110,000	90,000
	Prepaid expenses	    35,000	    20,000
		Total current assets	$260,000	$245,000

Current liabilities
	Accounts payable	$140,000	$110,000
	Salaries payable	40,000	30,000
	Income tax payable	    20,000	    15,000
		Total current liabilities	$200,000	$155,000

During 2014, credit sales and cost of goods sold were $600,000 and $350,000, respectively.

Required: Compute the following liquidity measures for 2014:
A.	Current ratio.
B.	Acid-test ratio.
C.	Receivables turnover.
D.	Inventory turnover.





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