Question

Prepare a balance sheet from the following information. What is the net working capital and debt ratio?

3-3. (Preparing a balance sheet) Prepare a balance sheet from the following information. What is the net working capital and debt ratio? Cash $ 50,000 Accounts receivable 42,700 Accounts payable 23,000 Short-term notes payable 10,500 Inventories 40,000 Gross fixed assets 1,280,000 Other current assets 5,000 Long-term debt 200,000 Common stock 490,000 Other assets 15,000 Accumulated depreciation 312,000 Retained earnings 3-4. (Preparing a balance sheet) Prepare a balance sheet and a common-sized balance sheet from the following

Answer 1

Solution:-

Assets
Cash	$50,000	4.5%
Accounts receivable	42,700	3.8%
Inventories	40,000	3.6%
Other current assets	5,000	0.4%
Total current assets	137,700	12.3%
Gross fixed assets	1,280,000	114.2%
Accumulated depreciation	(312,000)	(27.8%)
Net fixed assets	968,000	86.4%
Other assets	15,000	1.3%
Total assets	1,120,700	100%
Liabilities and Equity
Accounts Payable	$23,000	2.0%
Short-term notes payable	10,500	0.9%
Total short-term debt	33,500	3.0%
Long-term debt	200,000	17.8%
Total long-term debt	200,000	17.8%
Total debt	233,500	20.8%
Common Stock	490,000	43.7%
Retained earnings	397,200	35.4%
Total Equity	887,200	79.1%
Total debt and Equity	1,120,700	100%

Net working capital	104,200
Debt ratio	20.8%

Please Rate.