PROBLEM 1-6 You are an analyst reviewing Foxx Company. The following data are available for your financial analysis (unless otherwise indicated, all...

PROBLEM 1–6 You are an analyst reviewing Foxx Company. The following data are available for your financial

analysis (unless otherwise indicated, all data are as of December 31, Year 2):

Current ratio . . . . . . . . . . . . . . . . . . . . . . . 2 Days’ sales in inventory . . . . . . . . . . . . . . . . 36 days

Accounts receivable turnover . . . . . . . . . . 16 Gross profit margin ratio . . . . . . . . . . . . . . . 50%

Beginning accounts receivable . . . . . . . . . $50,000 Expenses (excluding cost of goods sold) . . . $450,000

Return on end-of-year common equity . . . 20% Total debt to equity ratio . . . . . . . . . . . . . . . 1

Sales (all on credit) . . . . . . . . . . . . . . . . . $1,000,000 Noncurrent assets . . . . . . . . . . . . . . . . . . . . $300,000

Required:

Using these data, construct the December 31, Year 2, balance sheet for your analysis. Current assets consist of cash, accounts receivable, and inventory. Balance sheet classifications include cash,

accounts receivable, inventory, total noncurrent assets, total current assets, total current liabilities,

total noncurrent liabilities, and equity.

Understanding Financial

Statement Relations:

Balance Sheet

Construction

CHECK

Total assets, $500,000

Subramanyam, K.R.; Wild, John (2013-05-24). Financial Statement Analysis (Page 54). McGraw-Hill Education. Kindle Edition.