$ 24,313 $ 1.22 5 203 mon stock outstanding du wration had 20,000 hares of commo
ID: 2394918 • Letter: #
Question
$ 24,313 $ 1.22 5 203 mon stock outstanding du wration had 20,000 hares of common stock ousta ents for 2011 an 2010 showing percentages ofnet sales for explanation of why this change occurred income taxes? What action by management probably causedhncome cach component. ecrease rease from 2010 to 2011 Wnte From the information provided, prepare mul 2. Did income from operations increase or d usERINsor> did other revenues and expenses have on the cha P3. The following information is from the June 30, 2011, post c Bissel Hardware Corporation. 0, 2011, post dlosing i o3,5 Classified Balance Sheet Debit S 64,000 66,000 20,000 552,000 290,000 3,200 9,600 2,560 Account Name Credit Total assets 1,195,200 Cash Short-Term Investments Notes Receivable Accounts Reccivable Merchandise Inventory Prepaid Rent Prepaid Insurance Sales Supplies Office Supplics Deposit for Future Advertising Building, Not in Use Land Delivery Equipment Accumulated Depreciation-Delivery Equipment 880 7,360 99,200 46,800 82,400 Trademark Accounts Payable Salaries Payable S 56,800 8,000 229,200 10,400Explanation / Answer
Ans 1: BISSEL HARDAWARE CORPORATION
STATEMENT OF FINANCIAL POSITION
Particulars
Note
Amount ($)
ASSETS
Current assets
Cash and cash equivalents
64000.00
Short Term Investments
66000.00
Trade receivables
1
572000.00
Inventories
290000.00
Other current assets
2
23600.00
Total current assets
1015600.00
Fixed assets
Tangible Assets:
Land
46800.00
Building, not in use
99200.00
Delivery Equipment
3
25600.00
Intangible Assets:
Trademark
8000.00
Total non-current assets
179600.00
Total assets
1195200.00
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables
4
239600.00
Short-term borrowings
-
Accrued expenses
3680.00
Total current liabilities
243280.00
Long-term liabilities
Long-term debt
160000.00
Deferred taxes
-
Total non-current liabilities
160000.00
Total liabilities
403280.00
Shareholders’ Equity
Capital
44000.00
Additional paid-in capital
320000.00
Retained earnings
427920.00
Total equity
791920.00
Total liabilities and equity
1195200.00
Note 1: Trade Receivables
Amount ($)
Notes Receivable
20000.00
Accounts Receivable
552000.00
Total
572000.00
Note 2: Other Current Assets
Amount ($)
Prepaid Rent
3200.00
Prepaid Insurance
9600.00
Sales Supplies
2560.00
Office Supplies
880.00
Deposit for Future Advertising
7360.00
Total
23600.00
Note 3: Delivery Equipment
Amount ($)
Delivery Equipment
82400.00
Less: Accumulated Depreciation
56800.00
Total
25600.00
Note 4: Trade and other payables
Amount ($)
Accounts Payable
229200.00
Salaries Payable
10400.00
Total
239600.00
Ans 2. The Debt-to-Equity ratio (D/E) indicates the proportion of the company’s assets that are being financed through debt. Debt to Equity ratio is a long term solvency ratio that indicates the soundness of long-term financial policies of the company.
Debt to Equity ratio of the above statement= Total Liabilities/ Shareholders' Equity
=403280/791920
=0.51
Ans 1: BISSEL HARDAWARE CORPORATION
STATEMENT OF FINANCIAL POSITION
Particulars
Note
Amount ($)
ASSETS
Current assets
Cash and cash equivalents
64000.00
Short Term Investments
66000.00
Trade receivables
1
572000.00
Inventories
290000.00
Other current assets
2
23600.00
Total current assets
1015600.00
Fixed assets
Tangible Assets:
Land
46800.00
Building, not in use
99200.00
Delivery Equipment
3
25600.00
Intangible Assets:
Trademark
8000.00
Total non-current assets
179600.00
Total assets
1195200.00
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables
4
239600.00
Short-term borrowings
-
Accrued expenses
3680.00
Total current liabilities
243280.00
Long-term liabilities
Long-term debt
160000.00
Deferred taxes
-
Total non-current liabilities
160000.00
Total liabilities
403280.00
Shareholders’ Equity
Capital
44000.00
Additional paid-in capital
320000.00
Retained earnings
427920.00
Total equity
791920.00
Total liabilities and equity
1195200.00
Note 1: Trade Receivables
Amount ($)
Notes Receivable
20000.00
Accounts Receivable
552000.00
Total
572000.00
Note 2: Other Current Assets
Amount ($)
Prepaid Rent
3200.00
Prepaid Insurance
9600.00
Sales Supplies
2560.00
Office Supplies
880.00
Deposit for Future Advertising
7360.00
Total
23600.00
Note 3: Delivery Equipment
Amount ($)
Delivery Equipment
82400.00
Less: Accumulated Depreciation
56800.00
Total
25600.00
Note 4: Trade and other payables
Amount ($)
Accounts Payable
229200.00
Salaries Payable
10400.00
Total
239600.00
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