With Bob's help, Richard has purchase, installed and setup his new accounting software program. In fact,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
With Bob's help, Richard has purchase, installed and setup his new accounting software program. In fact, he has just printed his first income statement and balance sheet, reproduced below. Warrior Industries Income Statement for year ending 12/31/20XX Sales revenue Less cost of goods sold Gross margin Less operating expenses Marketing Sales and administrative Depreciation Total operating expenses Operating income Less interest expense Income before taxes Income tax expense Net income 40,000 20,000 10,000 456,428 205,200 251,228 70,000 181,228 7,000 174,228 40,000 134,228 Assets Current Assets Cash Accounts receivable Inventory Fixed assets Total current assets Property, plant and equipment Accumulated depreciation Net fixed assets Total assets Liabilities and Owner's Equity Current liabilities Accounts payable Note payable to bank Deposits from customers Total current liabilities Long term mortgage Owner's Equity Total liabilities Retained earnings Owners' Equity Total liability and equities $ 52,400.00 $ 11,000.00 $ 15,900.00 $ 79,300.00 $ 80,000.00 $ (20,000.00) $ 60,000.00 $139,300.00 $5,300.00 $ 2,700.00 $ 6,000.00 $14,000.00 $ 40,000.00 $ 54,000.00 $ 85,300.00 $ 85,300.00 $139,300.00 1. How much revenue did the business produce? 2. What costs did the business have for financing? 3. What can you turn into cash in one year? What did it cost to make your product? 5. What is the value of everything the company owns? 6. How much profit did the company make? 7. How much is the business worth to Richard? 8. How much does the business need for its continuing operation? Hint: Net Fixed Assets is the purchase price of all fixed assets (Land, buildings, equipment, machinery, vehicles, leasehold improvements) less accumulated Depreciation 9. What debts will take longer than a year to pay? 10. Can this business be considered liquid? Hint: Current ratio = current assets/ current liabilities By the rule of thumb, it should be 2 or greater. The current ratio is an indicator of a business' ability to repay debt when it is due With Bob's help, Richard has purchase, installed and setup his new accounting software program. In fact, he has just printed his first income statement and balance sheet, reproduced below. Warrior Industries Income Statement for year ending 12/31/20XX Sales revenue Less cost of goods sold Gross margin Less operating expenses Marketing Sales and administrative Depreciation Total operating expenses Operating income Less interest expense Income before taxes Income tax expense Net income 40,000 20,000 10,000 456,428 205,200 251,228 70,000 181,228 7,000 174,228 40,000 134,228 Assets Current Assets Cash Accounts receivable Inventory Fixed assets Total current assets Property, plant and equipment Accumulated depreciation Net fixed assets Total assets Liabilities and Owner's Equity Current liabilities Accounts payable Note payable to bank Deposits from customers Total current liabilities Long term mortgage Owner's Equity Total liabilities Retained earnings Owners' Equity Total liability and equities $ 52,400.00 $ 11,000.00 $ 15,900.00 $ 79,300.00 $ 80,000.00 $ (20,000.00) $ 60,000.00 $139,300.00 $5,300.00 $ 2,700.00 $ 6,000.00 $14,000.00 $ 40,000.00 $ 54,000.00 $ 85,300.00 $ 85,300.00 $139,300.00 1. How much revenue did the business produce? 2. What costs did the business have for financing? 3. What can you turn into cash in one year? What did it cost to make your product? 5. What is the value of everything the company owns? 6. How much profit did the company make? 7. How much is the business worth to Richard? 8. How much does the business need for its continuing operation? Hint: Net Fixed Assets is the purchase price of all fixed assets (Land, buildings, equipment, machinery, vehicles, leasehold improvements) less accumulated Depreciation 9. What debts will take longer than a year to pay? 10. Can this business be considered liquid? Hint: Current ratio = current assets/ current liabilities By the rule of thumb, it should be 2 or greater. The current ratio is an indicator of a business' ability to repay debt when it is due
Expert Answer:
Answer rating: 100% (QA)
1 The business produced a revenue of 456428 2 Cost of financing is the interest paid 7... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...
-
Comparative statement of financial position accounts of Secada Inc., which follows IFRS, follow: Additional information: Secada Inc. has adopted the policy of classifying interest paid as operating...
-
In Exercises sketch the graph of an arbitrary function that satisfies the given condition but does not satisfy the conditions of the Mean Value Theorem on the interval [-5, 5]. is continuous on...
-
Computers have become a staple in the lives of most people. There are many companies that provide computers on the market. Assume that you are planning to purchase a new laptop for your classes, work...
-
Compare the promotional materials from two competitive (small) businesses. What are the goals and objectives of the promotions? How well do you think they fulfill these objectives?
-
If resistors 1 and 2 are connected to identical batteries, resistor 1 dissipates 3.0 times more power than resistor 2 . What is the ratio \(P_{1} / P_{2}\) of their power dissipations if the same...
-
Following are a trial balance and the transactions that relate to the City of Patin Heights Debt Ser-vice Fund: 1. The city council of Patin Heights adopted the budget for the Debt Service Fund for...
-
Develop a coaching strategy. research and then develop a coaching strategy for consultation with the client. (a client who wishes to introduce an overall coaching strategy into its operations and as...
-
Determine expressions for the mean residence time given "outward" diffusional release into a perfect sink from a) A cylindrical monolithic device of radius a, with ends capped. b) A spherical device...
-
Assume that you are in charge of special education for the Miami Dade School District. The district implemented a program which involves integrating autistic children with other children in the...
-
Design a small Java program simulating a consumption of gas mileage of an automobile during road trips under various scenarios. 1. User options for a number of passengers 2. No user input necessary....
-
2 and g(x)= Let f(x) = X What is (go f)(x)? What is (fog)(x)? 2 X Are f and g inverse functions of each other? Yes No
-
You must write a public abstract class named BankAccount with fields and methods as defined below. BankAccount < > # accountID: String # interestRate: double # currentBalance : int + credit(pennies:...
-
The main memory of a computer is organized as 256 blocks, with a block size of 8 words. The cache has 16 block frames. For the questions below, show the mappings from the numbered blocks of main...
-
a. The spending-Income multiplier reduces spending-income changes into larger changes in aggregate supply, causing cost-push Inflation. magnifies spending-income changes into greater changes in...
-
Determine if the triangles are congruent or not APQR = A b. AHJK =A . U H M V P. K R J S L ABOX = A d. AMIT =A . N B G. M I X AMAX =A f. AJET =A . T M N E N I
-
Borrowing costs should be recognised as an expense and charged to the profit and loss account of the period in which they are incurred : A. If the borrowing costs relate to qualifying asset B. If the...
-
Your friend is considering investing in Cineplex Inc., a publicly traded company listed on the Toronto Stock Exchange. She believes the failure of DVD retailers has drastically improved prospects for...
-
Refer to the information presented in PA-11. Assume that Jill K. Ltd. is a private corporation that elects to report its financial results in accordance with ASPE. Data from PA-11 Income tax expense...
-
Electronic Arts Inc. (EA) is a name that is familiar to most gamers. The company develops and distributes software products such as Battlefield, Mass Effect, Need for Speed, Dragon Age, The Sims,...
-
In Example 9.13, the following finite distributed lag model was estimated for Okun's Law using the data file okun5_aus. a. Find the correlogram of the least squares residuals for this model. Is there...
-
Using the data file phillips5_aus, estimate the equation a. Find the first eight lag weights (delay multipliers) of the infinite distributed lag representation that corresponds to this model. What is...
-
Using the data file phillips5_aus, estimate the equation a. Find the first eight lag weights (delay multipliers) of the infinite distributed lag representation that corresponds to this model. What is...
Study smarter with the SolutionInn App