Financial statement construction via ratios. Incomplete financial statements of Lock Box, Inc., are presented below.

LOCK BOX, INC.

Income Statement

For the Year Ended December 31, 19X3

Sales

Cost of goods sold

Gross profit ....................$1,50,00,000

Operating expenses & interest

Income before tax

Income taxes, 40%

Net income

LOCK BOX, INC.

Balance Sheet

December 31, 19X3

Assets

Cash

Accounts receivable

Inventory

Property, plant, & equipment ............ 80,00,000

Total assets..................$2,40,00,000

Liabilities & Stockholders' Equity

Accounts payable

Notes payable (short-term) ............. 6,00,000

Bonds payable ................. 46,00,000

Common stock ................. 20,00,000

Retained earnings

Total liabilities & stockholders' equity........2,40,00,000

Further information:

1. Cost of goods sold is 60% of sales. All sales are on account.

2. The company's beginning inventory is $5 million; inventory turnover is 4.

3. The debt to total assets ratio is 70%.

4. The profit margin on sales is 6%.

5. The firm's accounts receivable turnover is 5. Receivables increased by $400,000 during the year.

6. Calculate missing amounts, retained earnings, cash, income taxes, income before tax, operating expenses.

Instructions:

Using the preceding data, complete the income statement and the balance sheet.