Reference no: EM133197884
Seaforce Manufacturing Inc.
Income Statement
Year Ended December 31, 20X5
|
Sale
|
|
$ 340,000
|
|
Cost of goods sold
|
|
$ 250,100
|
|
Gross Profit
|
|
$ 89,900
|
|
Operating Expenses
|
|
$ 55,000
|
|
Loss on Sale of equipment
|
$ 2,500
|
$ 57,500
|
|
Profit from Operations
|
|
$ 32,400
|
|
Other expenses
|
|
|
|
Interest Expense
|
|
$ 3,500
|
|
Profit before Income Tax
|
|
$ 28,900
|
|
Income Tax Expense
|
|
$ 12,000
|
|
Profit
|
|
$ 16,900
|
|
|
20X5
|
20X4
|
|
Cash
|
$ 6,450
|
$ 4,100
|
|
Accounts Receivable
|
$ 72,000
|
$ 6,500
|
|
Inventory
|
$110,250
|
$140,000
|
|
Prepaid Expenses
|
$ 1,750
|
$ 1,020
|
|
Equipment
|
$ 96,000
|
$100,000
|
|
Accumulated Depreciation - equipment
|
($50,000)
|
($42,000)
|
|
Total Assets
|
$236,450
|
$209,620
|
|
|
|
|
|
Account Payable
|
$ 16,230
|
$ 9,900
|
|
Interest Payable
|
$ 810
|
$ 10
|
|
Income taxes payable
|
$ 10,800
|
$ 9,500
|
|
Dividends Payable
|
$ 1,800
|
$ 2,800
|
|
Long-term Notes Payable
|
$ 55,000
|
$ 62,000
|
|
Common shares
|
$135,000
|
$123,000
|
|
Retained Earnings
|
$ 16,310
|
$ 2,410
|
|
Total Liabilities & Shareholders' Equity
|
$236,450
|
$209,620
|
Additional Information:
1. Operating expenses include depreciation expense of $10,000
2. Accounts Payable related to the purchase of inventory
3. Equipment that cost $12,500 was sold at a loss of $2,500
4. New equipment was purchased during the year for $8,500
5. Dividends declared and paid in 20X5 totaled $3,000
6. Common shares were sold for $12,000 cash
7. Interest payable in 20X5 was $800 greater than interest payable in 20X4
Seaforce Manufacturing Inc. comparative balance sheet at December 31 20X5
Round answers to fit 2 decimal places in all questions (in % questions a 0.12 is presented as 12%, so a 0.124 is rounded as 12% and 0.127 is rounded as 13%)
Return on Common Equity at December 20X5 was:
Multiple Choice
- Between 20% and 39%
- Equal or above 82%
- Between 40% and 81%
- Not enough data provided to calculate it
- Equal or below 19%