Problem 1 The following information applies to Barnhart Company: Problem 2 The Jiffy Manufacturing Company started operations in 2012 when it acquired $100,000 from its owners.

Problem 1. The following information applies to Barnhart Company:

Assets

Cash     5,000

Accounts Receivable  12000

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 

Problem 2. The Jiffy Manufacturing Company started operations in 2012 when it acquired $100,000 from its owners. During the year, the company incurred the following costs:

    Raw materials used      $ 40,000

    Labor                             50,000

    Overhead                        20,000

    Selling & Administrative costs  30,000

The company placed 12,000 units into production, completed 10,000 units, and sold 8,000 units. The average selling price was $17 per unit.

Required:

1) Prepare a schedule of cost of goods manufactured and sold for the year ended December 31, 2012.

2) Prepare an income statement for the year ended December 31, 2012.