Except as otherwise indicated assumethat all balance sheet

Assignment Help Accounting Basics

Reference no: EM13613933

Merchandise inventory. . . . . . . . . .. . . . . . . . . . . . $ 264,000
Notes payable ( long- term) . . . . . . . . . . . . . . . . . . .300,000
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . 900,000
Buildings and equipment . . . . . . . . . . . . . . . . . . . .504,000
Selling, general, and administrative expenses . . . . 72,000
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . .120,000
Common stock ( 42,000 shares). . . . . . . . . . . . . . .210,000
Income tax expense . . . . . . . . . . . . . . . . . . . . .. . 84,000
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . 192,000
Retained earnings, 1/ 1/ 09 . . . . . . . . . . . . . . . . . . .129,000
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . .. . 18,000
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . .540,000
Accumulated depreciation . . . . . . . . . . . . . . . . . . .216,000
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . .. 48,000
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . .90,000
Dividends declared and paid during 2009 . . . . . . .39,000

Except as otherwise indicated, assumethat all balance sheet items reflect account balances at December31, 2009, and that all income statement items refl ect activitiesthat occurred during the year ended December 31, 2009. There wereno changes in paid- in capital during the year.
Required:
a. Prepare an income statement and statement of changes in ownersequity for the year ended December 31, 2009, and a balance sheet atDecember 31, 2009, for Shae, Inc. Based on the fi nancialstatements that you have prepared for part a, answer the questionsin parts

b e. Provide brief explanations for each of your answers andstate any assumptions you believe are necessary to ensure that youranswers are correct. b. What is the companys average income taxrate?

c. What interest rate is charged on long- term debt?

d. What is the par value per share of common stock?

e. What is the companys dividend policy ( i. e., what proportion ofthe companys earnings are used for dividends)?

Reference no: EM13613933

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