Use your knowledge of balance sheets and common-size statements
to fill in the missing dollar amounts:
ASSETS
Cash $25,000 3.4%
Accounts receivable $125,000 _____
Inventory _______ 27.1%
Total current assets $350,000 ______
Gross plant and equipment _______ 95.0%
Less: accumulated depreciation $313,000 42.5%
Net plant and equipment _______ ______
Total assets $737,000 100.0%
LIABILITIES
Accounts payable _______ 15.7%
Notes payable $29,000 3.9%
Total current liabilities _______ _____
Long-term debt $248,000 33.6%
Total liabilities $393,000 _____
Common stock ($.01 par,
450,000 shares) $4,500 0.6%
Paid-in capital $220,500 29.9%
Retained earnings _______ _____
Total stockholders’ equity $344,000 46.7%
Total liabilities and equity _______ 100.0%
Use your knowledge of balance sheets and common-size statements
to fill in the missing dollar amounts:
ASSETS
Cash $25,000 3.4%
Accounts receivable $125,000 17.0%
Inventory 200,000 27.1%
Total current assets $350,000 47.5%
Gross plant and equipment $700,000 95.0%
Less: accumulated depreciation $313,000 42.5%
Net plant and equipment $387,000 52.5%
Total assets $737,000 100.0%
LIABILITIES
Accounts payable $116,000 15.7%
Notes payable $29,000 3.9%
Total current liabilities $145.000 19.7%
Long-term debt $248,000 33.6%
Total liabilities $393,000 53.3%
Common stock ($.01 par,450,000 shares) $4,500 0.6%
Paid-in capital $220,500 29.9%
Retained earnings $119,000 16.1%
Total stockholders’ equity $344,000 46.7%
Total liabilities and equity $737,000 100.0%
To fill in the missing dollar amounts, we can use the common-size statement approach. With the given percentages, we can calculate the missing values.
ASSETS:
1. Accounts receivable: $125,000 / 27.1% = $461,363.64
2. Inventory: Total current assets - (Cash + Accounts receivable) = $350,000 - ($25,000 + $125,000) = $200,000
3. Total current assets: $350,000 / 3.4% = $10,294,117.65
4. Gross plant and equipment: Net plant and equipment / (100% - Accumulated depreciation) = Net plant and equipment / (100% - 42.5%)
Gross plant and equipment = Net plant and equipment / 57.5%
5. Net plant and equipment: Total assets - (Total current assets + Accumulated depreciation) = $737,000 - ($350,000 + $313,000)
Net plant and equipment = $74,000
LIABILITIES:
1. Accounts payable: Total current liabilities * 15.7% = Total current liabilities * $78,814.26 = $12,370
2. Total current liabilities: Total current liabilities / 15.7% = $12,370 / 15.7% = $78,814.26
3. Total liabilities: Total liabilities / (100% - 46.7%) = $344,000 / 53.3% = $646,792.45
STOCKHOLDERS' EQUITY:
1. Retained earnings: Total stockholders' equity - (Common stock + Paid-in capital) = $344,000 - ($4,500 + $220,500) = $119,000
2. Total stockholders' equity: $344,000 / 46.7% = $736,750
3. Total liabilities and equity: $737,000
The completed balance sheet is as follows:
ASSETS
Cash $25,000 3.4%
Accounts receivable $125,000 16.9%
Inventory $200,000 27.1%
Total current assets $350,000 47.4%
Gross plant and equipment $74,000 10.0%
Less: accumulated depreciation $313,000 42.5%
Net plant and equipment $44,000 6.0%
Total assets $737,000 100.0%
LIABILITIES
Accounts payable $12,370 1.7%
Notes payable $29,000 3.9%
Total current liabilities $41,370 5.6%
Long-term debt $248,000 33.6%
Total liabilities $289,370 39.3%
STOCKHOLDERS' EQUITY
Common stock ($.01 par, 450,000 shares) $4,500 0.6%
Paid-in capital $220,500 29.9%
Retained earnings $119,000 16.1%
Total stockholders’ equity $344,000 46.7%
Total liabilities and equity $737,000 100.0%
To fill in the missing dollar amounts in the balance sheet, we need to use the common-size percentages provided.
1. Accounts Receivable:
To determine the amount for accounts receivable, we can use the common-size percentage of 3.4%. This percentage represents the proportion of accounts receivable to total assets. We can calculate it by using the following formula:
Accounts Receivable = Total Assets * Accounts Receivable %
Accounts Receivable = $350,000 * 3.4%
Accounts Receivable = $11,900
2. Inventory:
To determine the amount for inventory, we can use the common-size percentage of 27.1%. This percentage represents the proportion of inventory to total assets. We can calculate it by using the following formula:
Inventory = Total Assets * Inventory %
Inventory = $350,000 * 27.1%
Inventory ≈ $94,850
3. Total Current Assets:
To determine the amount for total current assets, we can use the common-size percentage of 100.0%. This percentage represents the proportion of total current assets to total assets. We can calculate it by using the following formula:
Total Current Assets = Total Assets * Total Current Assets %
Total Current Assets = $737,000 * 100.0%
Total Current Assets = $737,000
4. Gross Plant and Equipment:
To determine the amount for gross plant and equipment, we can use the common-size percentage of 95.0%. This percentage represents the proportion of gross plant and equipment to total assets. We can calculate it by using the following formula:
Gross Plant and Equipment = Total Assets * Gross Plant and Equipment %
Gross Plant and Equipment = $737,000 * 95.0%
Gross Plant and Equipment ≈ $700,150
5. Net Plant and Equipment:
To determine the amount for net plant and equipment, we need to subtract the accumulated depreciation from the gross plant and equipment. The provided accumulated depreciation is $313,000.
Net Plant and Equipment = Gross Plant and Equipment - Accumulated Depreciation
Net Plant and Equipment = $700,150 - $313,000
Net Plant and Equipment ≈ $387,150
6. Accounts Payable:
To determine the amount for accounts payable, we can use the common-size percentage of 15.7%. This percentage represents the proportion of accounts payable to total liabilities. We can calculate it by using the following formula:
Accounts Payable = Total Liabilities * Accounts Payable %
Accounts Payable = Total Liabilities * 15.7%
Accounts Payable ≈ $61,401
7. Total Current Liabilities:
To determine the amount for total current liabilities, we can use the common-size percentage of 15.7%. This percentage represents the proportion of total current liabilities to total liabilities. We can calculate it by using the following formula:
Total Current Liabilities = Total Liabilities * Total Current Liabilities %
Total Current Liabilities = $393,000 * 15.7%
Total Current Liabilities ≈ $61,701
8. Retained Earnings:
To determine the amount for retained earnings, we need to subtract the sum of common stock and paid-in capital from the total stockholders' equity. The provided common stock is $4,500, and paid-in capital is $220,500.
Retained Earnings = Total Stockholders' Equity - (Common Stock + Paid-in Capital)
Retained Earnings = $344,000 - ($4,500 + $220,500)
Retained Earnings ≈ $119,000
9. Total Liabilities and Equity:
To determine the amount for total liabilities and equity, we can use the common-size percentage of 100.0%. This percentage represents the proportion of total liabilities and equity to total assets. We can calculate it by using the following formula:
Total Liabilities and Equity = Total Assets * Total Liabilities and Equity %
Total Liabilities and Equity = $737,000 * 100.0%
Total Liabilities and Equity = $737,000
Using the calculations above, the missing dollar amounts are:
Accounts Receivable: $11,900
Inventory: $94,850
Total Current Assets: $737,000
Gross Plant and Equipment: $700,150
Net Plant and Equipment: $387,150
Accounts Payable: $61,401
Total Current Liabilities: $61,701
Retained Earnings: $119,000
Total Liabilities and Equity: $737,000