Given the balance sheet below, would you make a $3,000 sale to this company and agree to
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Given the balance sheet below, would you make a $3,000 sale to this company and agree to let them pay you in 30 days? Why or why not? Use a ratio to support your answer.
Burns Co. | ||||||
Balance Sheet | ||||||
As of December 31, 2023 | ||||||
Assets | Liabilities | |||||
Current Assets | Current Liabilities | |||||
Cash | 5,000 | Accounts Payable | 10,000 | |||
Accounts Receivable | 15,000 | Accrued Payroll | 5,000 | |||
Inventory | 50,000 | Total Current Liabilities | 15,000 | |||
Total Current Assets | 70,000 | Long-term Debt Payable | 200,000 | |||
Total Long-term Liabilities | 200,000 | |||||
Fixed Assets | Total Liabilities | 215,000 | ||||
Property | 80,000 | Stockholders' Equity | ||||
Plant & Equipment | 165,000 | Capital Stock | 30,000 | |||
Accumulated Dep | 30,000 | Retained Earnings | 40,000 | |||
Total Fixed Assets | 215,000 | Total Stockholders' Equity | 70,000 | |||
Total Assets | 285,000 | Total Liabilities & S.E. | 285,000 |
Related Book For
Financial Accounting and Reporting a Global Perspective
ISBN: 978-1408076866
4th edition
Authors: Michel Lebas, Herve Stolowy, Yuan Ding
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