Complete the balance sheet and sales information using the following financial d

Question

Complete the balance sheet and sales information using the following financial data:

Total assets turnover: 1.5x
Days sales outstanding: 41 daysa
Inventory turnover ratio: 7x
Fixed assets turnover: 3.5x
Current ratio: 1.7x
Gross profit margin on sales: (Sales - Cost of goods sold)/Sales = 20%
aCalculation is based on a 365-day year. Round your answer to the nearest cent.

Balance Sheet Cash $   Current liabilities $   Accounts receivable $   Long-term debt 50,000 Inventories $   Common stock $   Fixed assets $   Retained earnings 50,000 Total assets $200,000 Total liabilities and equity $   Sales $   Cost of goods sold

Explanation / Answer

Total Assets: $ 200000 Total assets turnover ratio: 1.5 Total asset turnover = Net sales / Total assets 1.5 = Sales /200000 Sales: $ 300000 Days Sales oustanding: 41 days Days sales outstanding : Number of days * Accounts recievable/ Net sales 41 = 365 *Accounts receivable /300000 Accounts receivable = $ 33699 Gross profit ratio= 20% of sales Gross profit: 300000*20% = 60000 Cost of goods sold = 300000-60000= 240,000 Inventory turnover: Cost of goods sold / Inventory 7 = 240000 /Inventory Inventory = 34286 Fixed Assets turnover: Sales / Fixed assets 3.5 = 300000/Fixed assets Fixed assets = 85714 Current assets = Total assets -Fixed assets 200000 -85714 = 114, 286 Cash = 114286- 33699-34286 = 46301 Current ratio =Current assets/ Current liabilities 1.7 = 114286 / Current liabilities Current liabilities = 67227 Total assets = Total liabilities and equity Total liabilities and Equity = 200000 Common Stock = 200000 -50000-50000-67227 =32773

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