Question

Paul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices on which he had secured patents. Although the company has been fairly profitable, it is now experiencing a severe cash shortage. For this reason, it is requesting a $690,000 long-term loan from Gulfport State Bank, $195,000 of which will be used to bolster the Cash account and $495,000 of which will be used to modernize equipment. The company's financial statements for the two most recent years follow: Sabin Electronics Comparative Balance Sheet This Year Last Year $ 146,000 724.000 1.135.000 38,000 2,043,000 2,229,400 4272.400 340,000 16,000 490,000 785,000 41,000 1,672,000 1,480,000 3.152,000 $ $ Assets Current assets Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders Equity Liabilities: Current liabilities Bonds payable, 12% Total liabilities Stockholders' equity Common stock, $15 par Retained earnings Total stockholders' equity Total liabilities and stockholders' equity S 895,000 850,000 1,745,000 410,000 850,000 1,260,000 880,000 1,647.400 2.527,400 4,272,400 880.000 1,012.000 1,892,000 3,152.000 $

please help me with these two problems. the answers I have are wrong. thanks for your help!

Answer 1

Balance Sheet
Assets
Current Assets
Cash	3.4%	10.8%
Marketable Securities	0.0%	0.5%
Accounts Receivable	16.9%	15.5%
Inventory	26.6%	24.9%
Prepaid Expenses	0.9%	1.3%
Total Current Assets	47.8%	53.0%
Plant and Equipment	52.2%	47.0%
Total Assets	100.0%	100.0%
Liabilities & Stockholder's Equity
Liabilities
Current Liabilities	20.9%	13.0%
Bonds Payable	19.9%	27.0%
Total Liabilities	40.8%	40.0%
Stockholder's Equity
Common Stock	20.6%	27.9%
Retained Earnings	38.6%	32.1%
Total Stockholder's Equity	59.2%	60.0%
Total Liabilities & Stockholder's Equity	100.0%	100.0%

	This Year	Last Year
Sales	100.0%	100.0%
Cost of Goods Sold	68.3%	74.0%
Gross Margin	31.7%	26.0%
Selling and administrative expenses	11.6%	11.9%
Net Operating Income	20.1%	14.1%
Interest Expense	1.7%	2.1%
Net Income before taxes	18.4%	12.0%
Income taxes	5.5%	3.6%
Net Income	12.8%	8.4%