Below are the year-end balance sheets for Wolken Enterprises: 2015 2014 $ 200,00
ID: 420899 • Letter: B
Question
Below are the year-end balance sheets for Wolken Enterprises:
2015
2014
$ 200,000
$ 170,000
864,000
700,000
2,000,000
1,400,000
$3,064,000
$2,270,000
6,000,000
5,600,000
$9,064,000
$7,870,000
$1,400,000
$1,090,000
1,600,000
1,800,000
$3,000,000
$2,890,000
2,400,000
2,400,000
3,000,000
2,000,000
664,000
580,000
$3,664,000
$2,580,000
$9,064,000
$7,870,000
Wolken has never paid a dividend on its common stock, and it issued $2,400,000 of 10-year non-callable, long-term debt in 2014. As of the end of 2015, none of the principal on this debt had been repaid. Assume that the company's sales in 2014 and 2015 were the same. Which of the following statements must be CORRECT?
2015
2014
Cash$ 200,000
$ 170,000
Accounts receivable864,000
700,000
Inventories2,000,000
1,400,000
Total current assets$3,064,000
$2,270,000
Net fixed assets6,000,000
5,600,000
Total assets$9,064,000
$7,870,000
Liabilities and equity: Accounts payable$1,400,000
$1,090,000
Notes payable1,600,000
1,800,000
Total current liabilities$3,000,000
$2,890,000
Long-term debt2,400,000
2,400,000
Common stock3,000,000
2,000,000
Retained earnings664,000
580,000
Total common equity$3,664,000
$2,580,000
Total liabilities and equity$9,064,000
$7,870,000
Explanation / Answer
c. Wolken issued new common stock in 2015. Correct option
In the above statement there is increase of 10,00,000 $ in common stock.
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