To follow is the year end balances in the accounts of Vern Corporation at 12/31/

Question

To follow is the year end balances in the accounts of Vern Corporation at 12/31/13

Common Stock.......................................$ 20,000

Equipment................................................$24250

Accounts payable....................................$3100

Accounts Receivable.............................$10150

Prepaid rent............................................$380

salary & wages expenses.......................$5840

retained earnings, beggining 1/1/2013...$13960

cash..............................................................$20955

notes payable (due in 2018)....................$4700

sales revenue............................................$20450

Accumulated Depreciation-equipment...$6600

depreciation expense.................................$3200

dividends.......................................................$2800

income tax expense.....................................$700

income tax payable......................................$300

interest expenses........................................$350

interesr payable............................................$175

rent expense.................................................$660

Requirements : Calculate the following ratios

a) Gross Profit %

b) net profit %

c) Working Capital

d) Current ratio

e) Debt to total Assets.

[useful information]

- Sales Revenue.............$ 20,450

-Total expenses..............$10, 750

- Net income.....................$ 9700

- retained earnings.........$ 20,860

- total asset......................$ 49,135

- total liabilities.................$8275

- total equity.......................$ 40,860

Explanation / Answer

TOTAL EXPENSE = 10750

DIRECT EXPENSE = TOTAL EXPENSE - OPERATING EXPENSES

DIRECT EXPENSE = 10750

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