SOLUTIONS TOEND-OF-CHAPTER PROBLEMS
Solutions to Problem Set A
2-1A.
Belmond, Inc.
Balance Sheet
December 31, 2003ASSETS
Balance Sheet
December 31, 2003ASSETS
__________________________-
Current assets
Cash $ 16,550
Accounts receivable 9,600
Inventory 6,500
Total current assets $ 32,650
Gross buildings & equipment $122,000
Accumulated depreciation (34,000)
Net buildings & equipment$ 88,000
Total assets$120,650
LIABILITIES AND EQUITY
Liabilities
Current Liabilities
Notes payable $ 600
Accounts payable 4,800
Total current liabilities $ 5,400
Long-term debt 55,000
Total liabilities $ 60,400
Equity Common stock $ 45,000
Retained earnings 15,250
Total equity $ 60,250
Total liabilities and equity $120,650
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Belmond, Inc.
Income Statement
For the Year Ended December 31, 2003
Sales $ 12,800
Cost of goods sold $5,750
Gross profits $ 7,050
General & admin expense $ 850
Depreciation expense $ 500
Total operating expense $ 1,350
Operating income (EBIT) $ 5,700
Interest expense $900
Earnings before taxes $ 4,800
Taxes $1440
Net Income $3360
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