1. Fred Farmer has lesser liquid assets as compared to the amount of current liability. This is a major area of concern that can be highlighted from the balance sheet.
Total liquid assets = Accounts Receivable + Checking + Marketable Securities + Investment in growing wheat
= $2,800 + $3,400 + $16,500 + $6982.50
= $29,682.50
Current liability = $160,400
Thus, it can be seen that Fred Farmer might face challenges to meet its short-term liability.
2. No, I will not approve the loan as it is not viable. Fred Farmer might face difficulties to fulfill its current liability i.e. the lack of liquidity.
3. If no other changes have been made to the balance sheet, the total amount of balance sheet will remain the same whereas the amount of non-current liabilities will increase. To compensate the increase in the amount of non-current liabilities while maintaining the total amount of balance sheet, the amount of owner's equity will decrease.
Fred Farmer needs to prepare a balance sheet for his bank. He spent the day getting...
Fred Farmer needs to prepare a balance sheet for his bank. He spent the day getting the following information. Fred needs your help to build a balance sheet, and evaluate it. The information was gathered on 2/1/18 Grain sorghum in storage 4100 cwt @ $5.40 per cwt Hay on hand 75 ton @ $50.00 per ton Growing wheat 285 acres @ 24.50 per acre invested Farm mortgage payment due 4/7/18 $16,000 principle, $20,200 interest balance after 4/7/18 payment $228,000 Building...
Fred Farmer needs to prepare a balance sheet for his bank. He spent the day getting the following information. Fred needs your help to build a balance sheet, and evaluate it. The information was gathered on 2/1/18 Grain sorghum in storage 4100 cwt @ $5.40 per cwt Hay on hand 75 ton @ $50.00 per ton Growing wheat 285 acres @ 24.50 per acre invested Farm mortgage payment due 4/7/18 $16,000 principle, $20,200 interest balance after 4/7/18 payment $228,000 Building...
Rhonda Rancher has applied for a loan. Her banker, Larry Loanmaker, says the old balance sheet on file must be brought up to date before a loan will be considered. Rhonda spends the rest of the aftermoon taking inventory and gathering other information. In a new spreadsheet file, create a current Market Basis balance sheet for Rhonda dated February 1, 2020. Do not use any pre made templates. I want you to create the balance sheet from scratch. Use the...
BALANCE SHEET I. Rhonda Rancher has applied for a loan. Her banker, Larry Loanmaker, says the old balance sheet on file must be brought up to date before a loan will be considered. Rhonda spends the rest of the afternoon taking inventory and gathering other information. Complete a balanee on a separate page using the information below compiled by Rhonda on January 22, 2019. A Grain on hand a Hay on hand A Growing wheat L Farm mortgage (duel4/1/19) 3500...
Complete a balance sheet on a separate page using the information below compiled by Rhonda on January 22, 2019. Grain on hand 3500 bu. @ $5.00 per bu. Hay on hand 100 tons @ $80.00 per ton Growing wheat 200 acres @ $69.80 per acre Farm mortgage (due/4/1/19) $13,000 principal $10,000 accrued interest balance after 4/01/19 payment $260,000 Buildings & improvements $68,000 Note payable on feeder cattle (all due 4/15/19) $45,000 Calves (to be sold in May 2019) 100 head...
BALANCE SHEET I. Rhonda Rancher has applied for a loan. Her banker, Larry Loanmaker, says the old balance sheet on file must be brought up to date before a loan will be considered. Rhonda spends the rest of the afternoon taking inventory and gathering other information. Complete a balanee sheet on a separate page using the information below compiled by Rhonda on January 22, 2019. 3500 bu. @ $5.00 per bu. 100 tons @ $80.00 per ton Grain on hand...