Problem $35$: $($Required$,15$ points$)$ Complete the following balance sheet using the information given. Round account balances to the nearest dollar. You are required to write down your solutions step by step, and you have opportunity to earn partial points.

Balance Sheet

Income Statement

Cash

Sales $($All Credit$)$

$$34,000$

Accounts receivable

Cost of goods sold

$12,500$

Inventory

Operating expenses

$6,000$

Net fixed assets

Interest expense

$100$

Total assets

Taxes

$1,365$

Net income

$$2,530$

Accounts payable

Short$-$term notes payable

$$1,400$

Ratios:

Long$-$term debt

Return on Equity $=$

$14\%$

Common stock

$$4,500$

Quick Ratio $=$

$1\mathrm{.}1$

Retained earnings

Return on Total Assets $=$

$10\%$

Total Liabilities and equity

Net Fixed Asset Turnover $=$

$1\mathrm{.}6$

Current Ratio $=$

$2$

Average Collection Period

$45$

Tips: $1.$ Solve for common equity using ROE$=$Net Income$/$Common Equity

$2.$ Retained Earnings $=$ Common Equity $-$ Common Stock

$3.$ Net Fixed Asset Turnover $=$Sales$/$Net Fixed Assets