Reference no: EM13535318

Understanding and analyzing financial statement relationships- merchandising organization Gary's TV had the following accounts and amounts in its financial statements on December 31, 2010. Assume that all balance sheet items reflect account balances at December 31, 2010, and that all income statement items reflect activities that occurred during the year then ended.

Interest   expense	$36,000
Paid-in   capital	80,000
Accumulated   depreciation	24,000
Notes   payable (long-term)	280,000
Rent   expense	72,000
Merchandise   inventory	840,000
Accounts   receivable	192,000
Depreciation   expense	12,000
Land	128,000
Retained   earnings	900,000
Cash	144,000
Cost of   goods sold	1,760,000
Equipment	72,000
Income   tax expense	240,000
Accounts   payable	92,000
Sales   revenue	2,480,000

Required:

a. Calculate the difference between current assets and current liabilities for Gary's TV at December 31, 2010.

b. Calculate the total assets at December 31, 2010.

c. Calculate the earnings from operations (operating income) for the year ended December 31, 2010.

d. Calculate the net income (or loss) for the year ended December 31, 2010.

e. What was the average income tax rate for Gary's TV for 2010?

f. If $256,000 of dividends had been declared and paid during the year, what was the January 1, 2010, balance of retained earnings?