Question

HEIR JORDAN CORPORATION Income Statement $49,000 40,300 Sales Taxable income Taxes (22%) $8,700 1,914 Net income $6,786 Dividends Addition to retained $2,400 4,386 earnings The balance sheet for the Heir Jordan Corporation follows. Based on this information and the income statement, supply the missing information using the percentage of sales approach. Assume that accounts payable vary with sales, whereas notes payable do not. (Leave no cells blank - be certain to enter "o" whenever the item is not a constant percentage of sales. Enter each answer as a percent rounded 2 decimal places, e.g. 32.16.) HEIR JORDAN CORPORATION Balance Sheet Percentage of Sales Percentage of Sales Liabilities and Owners' Equity Current liabilities Assets Current assets Cash Accounts receivable Inventory 2,950 4,100 6,400 $13,450 Accounts payable Notes payable 2,400 5,400 Total Total Long-term debt Owners' equity 7,800 28,000 15,000 3,950 18,950 54,750 Common stock and paid-in surplus Retained earnings Fixed assets Net plant and equipment $41,300 Total Total assets $54,750 Total liabilities and owners' equity

Answer 1

The formulas used in excel are as follows: B Assets Amount Percentage of sales Liabilities and owners equity Amount Percentage of sales 3 Current assets Cash Accounts receivable Inventory Total Current liabilities Accounts payable Notes payable 2400 =+E4/49000 54000 2950 4100 6400 13450 =+B4/49000 =+B5/49000 =+B6/49000 =+B7/49000 10 Fixed assets 11 Net plant and equipment 41300 Total 78000 Long-term debt 280000 Owner's equity Common stock and paid-in surplus 150000 Retained earnings 3950 0 Total 189500 Total liabilities and owners equity 547500 =+B11/49000 Total 54750 =+B13/49000 The values obtained are as follows:

А E Percentage of sales F Percentage of sales Assets Amount Liabilities and owners equity Amount 3 Current assets Cash Accounts receivable Inventory Total $2,400.00 $5.400.00 Current liabilities Accounts payable Notes payable $2,950.00 $4,100.00 $6,400.00 $13,450.00 4.90% 0.00% 6.02% 8.37% 13.06% 27.45% 0.00% 0.00% 10 Fixed assets 11 Net plant and equipment $41,300.00 Total $7,800.00 Long-term debt $28,000.00 Owner's equity Common stock and paid-in surplus $15,000.00 Retained earnings $3,950.00 Total $18.950.00 Total liabilities and owners equity $54,750.00 84.29% K 0.00% 0.00% 0.00% 0.00% Total $54,750.00 111.73%