Question

integrated mini-case Working with Financial Statements Shown below are the partial financial statements for Garners' Platoon Mental Health Care, Inc. Fill in the blanks on the four income statements. 2021 2020 $ 316 867 $ 242 791 Assets Current assets: Cash and marketable securities Accounts receivable Inventory Total Fixed assets: Gross plant and equipment Less: Accumulated depreciation Net plant and equipment GARNERS' PLATOON MENTAL HEALTH CARE, INC. Balance Sheet as of December 31, 2021 and 2020 (in millions of dollars) 2021 2020 Liabilities and Equity Current liabilities: $ 421 Accrued wages and taxes Accounts payable Notes payable Total Long-term debt: Stockholders' equity: Preferred stock (30 million shares) $4.972 Common stock and paid-in surplus (200 million shares) 790 Retained earnings $5,864 $4.893 Total $7,889 Total liabilities and equity $3,290 $2,055 $3,090 $1,747 $ $ $ 60 60 637 Other long-term assets Total Total assets 3,312 $4,009 $9.154 2.440 $3,137 $7.889 GARNERS' PLATOON MENTAL HEALTH CARE, INC. Income Statement for Years Ending December 31, 2021 and 2020 (in millions of dollars) 2020 2021 $ 4,980 2.035 $ 2313 $ 2,734 122 $ 2,609 $ 2.213 Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) 200 191 $ 2,409 285 $ 1,737 $ 2,094 (continued)

Answer 1

Solution:

GARNERS` PLATOON MENTAL HEALTH CARE, INC.
Balance Sheet as of December 31, 2021 and 2020
( in millions of dollars )
	2021	2020		2021	2020
Assets			Liabilities and Equity
Current assets:			Current liabilities:
Cash and marketable securities	$          421	$            395	Accrued wages and taxes	$             316	$        242
Accounts receivable	$      1,109	$        1,020	Accounts payable	$             867	$        791
Inventory	$      1,760	$        1,581	Notes payable	$             872	$        714
Total	$      3,290	$        2,996	Total	$         2,055	$    1,747
Fixed assets:			Long-term debt:	$         3,090	$    3,005
Gross plant and equipment	$      5,812	$        4,743	Stockholder's equity:
Less: Accumulated depreciation	$          840	$            640	Preferred stock (30 million shares)	$               60	$          60
Net plant and equipment	$      4,972	$        4,103	Common stock and paid-in surplus	$             637	$        637
			(200 million shares )
Other Long-term assets	$          892	$            790	Retained earnings	$         3,312	$    2,440
Total	$      5,864	$        4,893	Total	$         4,009	$    3,137
Total assets	$      9,154	$        7,889	Total Liabilities and Equity	$         9,154	$    7,889

GARNERS` PLATOON MENTAL HEALTH CARE, INC.
Income statement for Years Ending December 31, 2021 and 2020
( in millions of dollars )
	2021	2020
Net Sales	$      4,980	$        4,348
Less: Cost of goods sold	$      2,246	$        2,035
Gross profit	$      2,734	$        2,313
Less: Other Operating expenses:	$          125	$            100
Earnings before interest, taxes, depreciation, and amortization (EBITDA)	$      2,609	$        2,213
Less: Depreciation	$          200	$            191
Earnings before interest and taxes (EBIT)	$      2,409	$        2,022
Less: Interest	$          315	$            285
Earnings before taxes( EBT )	$      2,094	$        1,737