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  • Oct 2, 2009, 02:49 PM
    brettmaher74
    HOMEWORK/FINANCNG RATIOS. It deals with liquidity Ratios
    Given Information:
    Bronco Electronics' current assets consist of cash, marketable securities, accounts receivable, and inventories. The following Data was abstracted from a recent financial statments:

    Inventories 150,000
    Total Assets 1,400,000
    Current Ratio 3
    Acid-Test Ratio 2.25
    Debt to Equity 1.5

    Compute the following:
    1. Current Assets
    2. Shareholder's Equity=560,000
    3. Noncurrent Assets
    4. Long-term liability


    I have no idea how to use the given info to find these missing values, any help would be greatly appreciated.
  • Oct 2, 2009, 03:12 PM
    Curlyben
    One copy and paste deserves another:

    Thank you for taking the time to copy your homework to AMHD.
    Please refer to this announcement: Ask Me Help Desk - Announcements in Forum : Homework Help
  • Oct 2, 2009, 09:09 PM
    rehmanvohra

    If you know about the composition of ratios, you can do the rest. We will not solve the problem for you, but we can guide you how to solve the problem.

    1 Current Assets = Inventory + Liquid assets
    2. Non current assets = Total assets - Current Assets
    3. Debt ratio = Debt/Equity
    4. Current ratio = Current Assets/Current Liabilities
    5. Acid test Ratio = Liquid Assets/Current Liabilities

    With the help of available figures, just fill in the blamks to get your answer
  • Oct 3, 2009, 02:49 AM
    morgaine300

    This is a "missing numbers" problems. Take all the equations and start filling in what you know. Some of the information given is the answers to the ratios, so you have to work backwards to get the missing numbers. You've found one. You can also utilize your accounting equation.
  • Oct 3, 2009, 05:04 AM
    ArcSine
    Brett, with a bit of detective work and some persistence you'll be fine. Referring to Rehmanvohra's points 1, 4, and 5, here's a hint on Current Assets:

    First note that the Current Ratio (CR) is .

    The only difference between CR and the Acid-Test Ratio (ATR) is that Inventory is included in current assets in the former, but excluded from CA in the ATR: .

    Next note that the ATR can be rewritten as . Since you've been given the values for Current Ratio, Inventory, and ATR, that ATR equation becomes

    . From here you can quickly solve for CL, which in turn will allow you to determine Current Assets.
  • Oct 12, 2011, 02:52 PM
    mayakhan
    Bronco Electronics' current assets consist of cash, marketable securities, accounts receivable, and inventories. The following data was abstracted from a recent financial statement:
    inventories 150,000
    total assets 1,400,000
    current ratio 3
    acid-test ratio 2.25
    debt to equity ratio 1.5

    Required: Compute the following for Bronco:
    Current assets
    Shareholders' equity
    Noncurrent assets
    Long-term liabilities
  • Oct 12, 2011, 02:54 PM
    mayakhan
    Bronco Electronics' current assets consist of cash, marketable securities, accounts receivable, and inventories. The following data was abstracted from a recent financial statement:
    inventories 150,000
    total assets 1,400,000
    current ratio 3
    acid-test ratio 2.25
    debt to equity ratio 1.5

    Required: Compute the following for Bronco:
    Current assets
    Shareholders' equity
    Noncurrent assets
    Long-term liabilities

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