Question: Use a spread sheet to construct a common-size balance sheet from the f

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Question: Use a spread sheet to construct a common-size balance sheet from the following balance sheet and the income statement. Balance Sheet Assets Liabilities Cash $10,000 Accounts payable $12,000 Accounts receivable 100,000 Notes payable 50,000 Inventory 110,000 Total current liabilities $62,000 Total current assets 220,000 Long-term debt 128,000 Gross plant and equipment 500,000 Total liabilities 190,000 Less: accumulated depreciation 125,000 Common stock ($1 par, 100,000 shares) 100,000 Net plant and equipment 375,000 Paid-in-capital 155,000 Total assets 595,000 Retained earnings 150,000 Total stockholders' equity $405,000 Total liabilities and equity $595,000 Income Statement Sales $2,175,000 Cost of goods sold $575,000 Gross profit $1,600,000 General and administrative expense $200,000 Selling and marketing expense $250,000 Depreciation $50,000 Operating income $1,100,000 Interest $100,000 Income before taxes $1,000,000 Income taxes (30%) $300,000 Net income $700,000 Answers: Common-size Balance Sheet Assets Liabilities Cash Accounts payable Accounts receivable Notes payable Inventory Total current liabilities Total current assets Long-term debt Gross P&E Total Liabilities Less accumulated Common stock Depreciation Paid-in capital Net P&E Retained earnings Total assets Total stockholders’ equity Total liabilities and equity Common-size Income Statement Sales COGS Gross profit G&A expense Sales & Marketing expense Depreciation Operating income Interest Income before taxes Income taxes (30%) Net income Question: Use a spread sheet to construct a common-size balance sheet from the following balance sheet and the income statement. Balance Sheet Assets Liabilities Cash $10,000 Accounts payable $12,000 Accounts receivable 100,000 Notes payable 50,000 Inventory 110,000 Total current liabilities $62,000 Total current assets 220,000 Long-term debt 128,000 Gross plant and equipment 500,000 Total liabilities 190,000 Less: accumulated depreciation 125,000 Common stock ($1 par, 100,000 shares) 100,000 Net plant and equipment 375,000 Paid-in-capital 155,000 Total assets 595,000 Retained earnings 150,000 Total stockholders' equity $405,000 Total liabilities and equity $595,000 Income Statement Sales $2,175,000 Cost of goods sold $575,000 Gross profit $1,600,000 General and administrative expense $200,000 Selling and marketing expense $250,000 Depreciation $50,000 Operating income $1,100,000 Interest $100,000 Income before taxes $1,000,000 Income taxes (30%) $300,000 Net income $700,000 Answers: Common-size Balance Sheet Assets Liabilities Cash Accounts payable Accounts receivable Notes payable Inventory Total current liabilities Total current assets Long-term debt Gross P&E Total Liabilities Less accumulated Common stock Depreciation Paid-in capital Net P&E Retained earnings Total assets Total stockholders’ equity Total liabilities and equity Common-size Income Statement Sales COGS Gross profit G&A expense Sales & Marketing expense Depreciation Operating income Interest Income before taxes Income taxes (30%) Net income

Explanation / Answer

Common Size Balance Sheet

Common Size Income Statement

Working

Income Statement Working

Assets Percent Liabilities Percent Cash 1.7% Accounts Payable 2.0% Accounts receivable 16.8% Notes Payable 8.4% Inventory 18.5% Total Current Liabilities 10.4% Total current assets 37.0% Long Term Debt 21.5% Gross P&E 84.0% Total Liabilities 31.9% Less accumulated depreciation 21.0% Common Stock ($1 par, 100000 Shares) 16.8% Net P&E 63.0% Paid in Capital 26.1% Retained earnings 25.2% Total Stock holders equity 68.1% Total assets 100% Total Liabilities & Equity 100%

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