Presented below is an incomplete income statement and an incomplete comparative balance sheet of Bondi Corporation. BONDI
Question:
Presented below is an incomplete income statement and an incomplete comparative balance sheet of Bondi Corporation.
BONDI CORPORATION
Income Statement
For the Year Ended December 31, 2013
Net Sales11,000,000
Cost of goods sold
Gross Profit
Operating Expenses1,665,000
Income from operations
Other expenses and losses
Interest expense
Income before income taxes
Income tax expense560,000
Net Income
BONDI CORPORATION
Balance Sheets
December 31
Assets20132012
Current Assets
Cash450,000375,000
Accounts Receivable (net)950,000
Inventory1,720,000
Total Current Assets3,045,000
Plant Assets (net)4,620,0003,955,000
Total Assets7,000,000
Liabilities and Stockholders’ Equity
Current Liabilities825,000
Long-term notes payable2,800,000
Total Liabilities3,625,000
Common stock, P1 par3,000,0003,000,000
Retained earnings400,000375,000
Total stockholders’ equity3,400,0003,375,000
Total liabilities and stockholders’ equity7,000,000
Additional information:
1. The receivables turnover for 2013 is 10 times.
2. All sales are on account.
3. The profit margin for 2013 is 14.5%.
4. Return on assets is 22% for 2013.
5. The current ratio on December 31, 2013, is 3.0.
6. The inventory turnover for 2013 is 4.8 times.
Instructions
Compute the missing information given the ratios above. Show computations. (Note: Start with one ratio and derive as much information as possible from it before trying another ratio. List all missing amounts under the ratio used to find the information.)
Expert Answer:
Receivables turnover ratio 10 Receivables Turnover Ratio Sales Receivables Sales 11000000 Receivable... View the full answer
Accounting Principles
ISBN: 978-0470534793
10th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
