Consider the following income statement for the Heir Jordan Corporation HEIR JOR

Question

Consider the following income statement for the Heir Jordan Corporation HEIR JORDAN CORPORATION Income Statement Sales Costs $43,800 34,800 Taxable income Taxes (21%) $9,000 1,890 Net income $ 7110 Dividends Addition to retained $4,300 2,810 earnings The balance sheet for the Heir Jordan Corporation follows. Based on this information and the income statement, supply the missing information using the percentage of sales approach. Assume that accounts payable vary with sales, whereas notes payable do not. (Leave no cells blank be certain to enter "O" whenever the item Is not a constant percentage of sales. Enter each answer as a percent rounded 2 declmal places, e.g 32.16.) HEIR JORDAN CORPORATION Balance Sheet of Sales of Sales Assets Liabilities and Owners' Equity Current assets Current liabilities Accounts payable Notes payable Cash 2,700 3,500 9,000 S 15,200 2.400 5.400 Inventory Total Total Long-term debt Owners' equity 7,800 S 24,000 Fixed assets $ 19,000 3,000 S 22,000 53,800 Net plant and equipment S 38,600 Common stock and paid-in surplus Total Total assets S 53,800 Total liabilities and owners' equity

Explanation / Answer

HEIR JORDAN CORPORATION

BALANCE SHEET

Except long term debt and owner's equity , remaining total assets and current liabilities divided by sales.

Assets Amount($) Percentage of sales Liabilities and owner's equity Amount($) Percentage of sales Current assets: Current liabilities: Cash $2700 6.16% Accounts payable $2400 5.48% Accounts receivable $3500 7.99% Notes payable $5400 12.33% Inventory $9000 20.55% Total $15200 34.70% Total $7800 17.81% Long term debt $24000 0 Fixed assets Owners' equity Net plant and equipment $38600 88.13% Common stock and paid in surplus $19000 0 Retained earnings $3000 0 Total $22000 0 Total assets $53800 122.83% Total liabilities and owners' equity $53800 0

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