MEGAFRAME COMPUTER COMPANY
Balance Sheet
As at December 31, 20X5
ASSETS
Cash $40,000
Accounts receivable $60,000
Inventory $90,000
New plant and equipment $220,000
Total Assets $410,000
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable $60,000
Accrued expenses $40,000
Long-term debt $130,000
Common stock $80,000
Retained earnings $100,000
Total Liabilities and Shareholders’ Equity $410,000
MEGAFRAME COMPUTER COMPANY
Income Statement
For the year ended December 31, 20X5
Sales (all on credit) $700,000
Cost of goods sold $400,000
Gross profit $300,000
Selling and administrative expense $100,000
Operating profit $200,000
Interest expense $40,000
Net income before taxes $160,000
Taxes (50%) $80,000
Net income $80,000
Megaframe's quick ratio is:
Multiple Choice
3:1.
1:1.
1.6:1.
1:2.
Group Ends