Q. No. 3 Completion of ABC Industries’ Balance Sheet for the Year Ending December 31, 2016
Balance Sheet
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ABC Industries Balance sheet ending December 31, 2016 Assets Liabilities and $ Cash $ stockholder’s Equity 120,000
Marketable securities 32,720 Accounts Payable Accounts receivable 25,000 Notes payable 20,000
Inventories Accruals
Total current assets Total current liabilities Net fixed assets Long-term debt
Total assets Stockholder’s equity 600,000
Total liabilities and stockholder’s equity
The following financial data for 2016 is also available;
(1) Sales totalled $1,800,000.
(2) The gross profit margin was 25%.
(3) Inventory turnover was 6.0.
(4) There are 365 days in the year.
(5) The average collection period was 40 days.
(6) The current ratio was 1.60
(7) The total asset turnover ratio was 1.20
(8) The debt ratio was 60%. complete the 2016 balance sheet for ABC Industries using the given information.
Answer
Given Information:
Steps to Calculate Missing Values:
1. Gross Profit Calculation:
2. Inventory Calculation:
3. Accounts Receivable Calculation:
4. Total Assets Calculation:
5. Current Liabilities Calculation:
6. Long-Term Debt Calculation:
7. Stockholder’s Equity Calculation:
Completed Balance Sheet for ABC Industries (December 31, 2016):
| Assets | Liabilities and Stockholder’s Equity |
|---|---|
| Cash: $120,000 | Accounts Payable: ? (not given) |
| Marketable Securities: $32,720 | Notes Payable: $20,000 |
| Accounts Receivable: $197,260 | Accruals: ? (not given) |
| Inventory: $225,000 | Current Liabilities: $359,363 |
| Total Current Assets: $574,980 | Long-Term Debt: $540,637 |
| Net Fixed Assets: ? (not given) | Stockholder’s Equity: $600,000 |
| Total Assets: $1,500,000 | Total Liabilities and Equity: $1,500,000 |
