Pepper Company provided the incomplete financial statements shown below as well as the following additional information:...

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Pepper Company provided the incomplete financial statements shown below as well as the following additional information: a. All sales during the year were on account. b. There was no change in the number of shares of common stock outstanding during the year. c. The interest expense on the income statement relates to the bonds payable; the amount of bonds outstanding did not change during the year. d. Selected balances at the beginning of the current year were: $ 120,000 $ 240,000 $ 1,815,000 Accounts receivable Inventory Total assets e. Selected financial ratios computed from the statements below for the current year are: Earnings per share Debt-to-equity ratio Accounts receivable turnover $ 3.78 0.800 15.0 Current ratio 2.20 Return on total assets 14% Times interest earned ratio 7.75 Acid-test ratio 1.15 Inventory turnover 8.0 Required: Compute the missing amounts on the company's financial statements. (Hint: What's the difference between the acid-test ratio and the current ratio?) (Do not round intermediate calculations.) Pepper Industries Income Statement For the Year Ended March 31 Sales 2,700,000 Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense 42,000 |Nat income hafore tavae Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense 42,000 Net income before taxes Income taxes (30%) Net income Pepper Industries Balance Sheet March 31 Current assets: Cash Accounts receivable, net Inventory Total current assets Plant and equipment, net Total assets Liabilities: Current liabilities $ 220,000 Bonds payable, 10% Total liabilities Stockholders' equity: Common stock, $2.80 par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Pepper Company provided the incomplete financial statements shown below as well as the following additional information: a. All sales during the year were on account. b. There was no change in the number of shares of common stock outstanding during the year. c. The interest expense on the income statement relates to the bonds payable; the amount of bonds outstanding did not change during the year. d. Selected balances at the beginning of the current year were: $ 120,000 $ 240,000 $ 1,815,000 Accounts receivable Inventory Total assets e. Selected financial ratios computed from the statements below for the current year are: Earnings per share Debt-to-equity ratio Accounts receivable turnover $ 3.78 0.800 15.0 Current ratio 2.20 Return on total assets 14% Times interest earned ratio 7.75 Acid-test ratio 1.15 Inventory turnover 8.0 Required: Compute the missing amounts on the company's financial statements. (Hint: What's the difference between the acid-test ratio and the current ratio?) (Do not round intermediate calculations.) Pepper Industries Income Statement For the Year Ended March 31 Sales 2,700,000 Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense 42,000 |Nat income hafore tavae Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense 42,000 Net income before taxes Income taxes (30%) Net income Pepper Industries Balance Sheet March 31 Current assets: Cash Accounts receivable, net Inventory Total current assets Plant and equipment, net Total assets Liabilities: Current liabilities $ 220,000 Bonds payable, 10% Total liabilities Stockholders' equity: Common stock, $2.80 par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity

Answer rating: 100% (QA)

Solution PEPPER INDUSTRIES Income Statement For the year ended March 31 sales 2700000 Cost of good sold 1884000 Gross Margin 816000 Selling Administra... View the full answer