Answer:
**Income Statement:
- Sales: $550,000
- Cost of goods sold: $320,000
- Depreciation expense: $38,000
- Interest expense: $26,000
- Income taxes: $59,850
- Marketing, general, and administrative expenses: $45,000
**Balance Sheet:
Assets:
- Cash: Unknown
- Accounts receivable: $73,000
- Inventories: $47,000
- Gross fixed assets: $648,000
- Accumulated depreciation: $190,000
- Other assets: $15,000
Liabilities:
- Accounts payable: $65,000
- Short-term notes payable: $29,000
- Long-term debt: $360,000
Equity:
- Common stock: $120,000
- Retained earnings: $138,500
Step-by-step explanation:
To prepare an income statement and balance sheet, we need to organize the given items into the respective categories.
To calculate the net income, we need to subtract the cost of goods sold, depreciation expense, interest expense, income taxes, and marketing, general, and administrative expenses from sales.
Net income = Sales - Cost of goods sold - Depreciation expense - Interest expense - Income taxes - Marketing, general, and administrative expenses
Net income = $550,000 - $320,000 - $38,000 - $26,000 - $59,850 - $45,000
Net income = $61,150
To calculate the missing value of cash, we need to calculate the total assets by adding the known values:
Total assets = Cash + Accounts receivable + Inventories + Gross fixed assets - Accumulated depreciation + Other assets
$Unknown + $73,000 + $47,000 + $648,000 - $190,000 + $15,000 = $Total assets
To calculate the total liabilities and equity, we need to add the known values:
Total liabilities and equity = Accounts payable + Short-term notes payable + Long-term debt + Common stock + Retained earnings
$65,000 + $29,000 + $360,000 + $120,000 + $138,500 = $Total liabilities and equity
The net working capital can be calculated by subtracting the current liabilities from the current assets. In this case, the current assets are the sum of cash, accounts receivable, and inventories. The current liabilities are the sum of accounts payable and short-term notes payable.
Net working capital = (Cash + Accounts receivable + Inventories) - (Accounts payable + Short-term notes payable)
Net working capital = ($Unknown + $73,000 + $47,000) - ($65,000 + $29,000)
Net working capital = $Unknown + $73,000 + $47,000 - $65,000 - $29,000
The debt ratio can be calculated by dividing the total liabilities by the total assets.
Debt ratio = Total liabilities / Total assets
Debt ratio = ($65,000 + $29,000 + $360,000) / $Total assets
Please provide the missing value of cash in order to calculate the net working capital and debt ratio.