Use the “balance sheet equation” to determine owners’ equity if liabilities are $5 million and assets are $10 million.
Answer to relevant QuestionsUse your knowledge of balance sheets to fill in the amounts missing in the text. Use the following information to construct an income statement. Sales ............... $1,230,000 Cost of goods sold Gross profit General and administrative expense Selling and marketing expense Depreciation ............ ...Using the financial statements in the text: a. Compute common-size financial statements. b. Compute year-to-year percentage changes in the various accounts. c. What insights about the firm can you obtain from this analysis? Describe what would happen to the DOL if all costs are fixed? Variable? Rework Problem 8 assuming that Genatron Manufacturing expects its sales to increase by 20 percent in 2013. What is the amount of external financing needed?
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