Presented here are an incomplete income statement and balance sheet for Vieux Corporation.

Additional information:

1. The gross profit margin is 40%.

2. The profit margin is 15%.

3. The receivables turnover is 10 times and all sales are on account.

4. The inventory turnover is 8 times.

5. The current ratio is 2:1.

6. The return on assets is 22%.

Instructions

Calculate the missing information using the ratios. Use ending balances instead of average balances, where averages are required for ratio calculations. Show your calculations.

Taking It Further

Why is it not possible to calculate the missing amounts in the same sequence (i.e., (a), (b), (c), etc.) that they are presented above?

Transcribed Image Text:

VIEUX CORPORATION Income Statement Year Ended December 31, 2021 Net sales $11,000,000 Cost of goods sold (a Gross profit Operating expenses (b) 1,600,000 Profit from operations Interest expense (c) Profit before income taxes (e) Income tax expense 707,000 Profit $ (f) VIEUX CORPORATION Balance Sheet December 31, 2021 Assets Current assets Cash Accounts receivable Inventory (h) (i) Total current assets Long-term investments Property, plant, and equipment () 430,000 4,420,000 Total assets (k) Liabilities Current liabilities (1) Non-current liabilities (m) Total liabilities (n) Shareholders' equity Common shares Retained earnings Total shareholders' equity 1,500,000 1,900,000 3,400,000 Total liabilities and shareholders' equity (0)