Question

What is the current year's cash balance?

What is the current year's return on equity (ROE)?

What is the current year's entry for long term debt on a common-sized balance sheet?

Category Accounts payable 41,400 45,000 Accounts receivable 115,200 122,400 Accruals 16,200 13,500 Additional paid in capital 200,000 216,660 Cash 777 772 Common Stock @ par value 37,600 42,000 COGS 131,400 178,243.00 Depreciation expense 21,600 22,453.00 Interest expense 16,200 16,617.00 Inventories 111,600 115.200 Long-term debt 135,000 137.737.00 Net fixed assets 375,678.00 399.600 Notes payable 59,400 64,800 Operating expenses (excl. depr.) 50.400 50.759.00 Retained earnings 122.400 136,800 Salos 255,600 335,152.00 Taxes 9,900 19.474.00

THIS IS ALL THE INFORMATION GIVEN

Answer 1

First, we need to categorize each item into the Balance Sheet item or profit and loss item. Then further sub-categorizing into Assets, Liability, Income or Expense.

Categorization is provided below :-

Particulars	Prior Year	Current Year	Category (Balance Sheet / P&L Item)	Sub-Category (Assets/Liability/Income/Expense)
Accounts Payable	41,400	45,000	Balance Sheet	Liability
Account Receivable	115,200	122,400	Balance Sheet	Assets
Accruals	16,200	13,500	Balance Sheet	Liability
Additional paid-in capital	200,000	216,660	Balance Sheet	Liability
Cash	???	???	Balance Sheet	Assets
Common Stock @ par value	37,600	42,000	Balance Sheet	Liability
COGS	131,400	178,243	P&L	Expense
Depreciation Expenses	21,600	22,453	P&L	Expense
Interest Expense	16,200	16,617	P&L	Expense
Inventories	111,600	115,200	Balance Sheet	Assets
Long term debt	135,000	137,737	Balance Sheet	Liability
Net Fixed Assets	375,678	399,600	Balance Sheet	Assets
Notes Payable	59,400	64,800	Balance Sheet	Liability
Operating expenses (excl. Depreciation)	50,400	60,759	P&L	Expense
Retained Earnings	122,400	136,800	Balance Sheet	Liability
Sales	255,600	335,152	P&L	Income
Taxes	9,900	19,474	P&L	Expense

For What is the current year's cash balance?

Preparing Income Statement for current and prior year to find out Net Income

Net Income Statement
Particulars	Prior Year	Current Year
Sales	255,600	335,152
Less
COGS	(131,400)	(178,243)
Depreciation Expenses	(21,600)	(22,453)
Interest Expense	(16,200)	(16,617)
Operationg expenses (excl. Depreciation)	(50,400)	(60,759)
Taxes	(9,900)	(19,474)
Net Income	26,100	37,606

Preparing Balance sheet for current and prior year to find out cash balance.

Balance Sheet
Liability	Prior Year	Current Year	Assets	Prior Year	Current Year
Accounts Payable	41,400	45,000	Account Receivable	115,200	122,400
Accruals	16,200	13,500	Cash (Balancing figure)*	35,622	56,903
Additional paid in capital	200,000	216,660	Inventories	111,600	115,200
Common Stock @ par value	37,600	42,000	Net Fixed Assets	375,678	399,600
Long term debt	135,000	137,737
Notes Payable	59,400	64,800
Retained Earnings	122,400	136,800
Add: Net Income for the year	26,100	37,606
Total	638,100	694,103	Total	638,100	694,103

*Formula Used:- Total Liability - Sum total of Assets

For Prior year :- 638,100 - (115,200+111,600+375,678)

For Current year :- 694,103 - (122,400+115,200+399,600)

For What is the current year's return on equity (ROE)?

ROE = Net Income / Shareholder Equity

Net Income = 37,606

Shareholder Equity = Common Stock @ par value + Additional paid in capital + Retained Earning + Net Profit

= 42,000 + 216,660 + 136,800 + 37,606

= 433,066

ROE = 37,606/433,066

= 8.68 %

For What is the current year's entry for long term debt on a common-sized balance sheet?

Answer:- 19.84%

Balance Sheet
Liability	Current Year	Common Size	Assets	Current Year	Common Size
Accounts Payable	45,000	6.48%	Account Receivable	122,400	17.63%
Accruals	13,500	1.94%	Cash (Balancing figure)	56,903	8.20%
Additional paid-in capital	216,660	31.21%	Inventories	115,200	16.60%
Common Stock @ par value	42,000	6.05%	Net Fixed Assets	399,600	57.57%
Long term debt	137,737	19.84%
Notes Payable	64,800	9.34%
Retained Earnings	136,800	19.71%
Add: Net Income for the year	37,606	5.42%
Total	694,103	100.00%	Total	694,103	100.00%