A Blue Ocean Co. has the following balance sheet: Cash                                               P 5,000 Accounts receivable                          3,000 Inventories                                        7,000 Fixed assets                                     45,000 Accounts payable                               5,000 Notes payable                                    10,000 Long-term debt                                  15,000 Common stock                                   25,000 Retained earnings                                5,000  The company is not operating at full capacity. The sales for the current year is P100,000 and it is expected to increase by P5,000 per year for the next 4 years. The profit margin and the plowback ratio is forecasted to be constant at 5% and 30%, respectively.   how much is the increase in retained earnings?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A Blue Ocean Co. has the following balance sheet:

Cash                                               P 5,000

Accounts receivable                          3,000

Inventories                                        7,000

Fixed assets                                     45,000

Accounts payable                               5,000

Notes payable                                    10,000

Long-term debt                                  15,000

Common stock                                   25,000

Retained earnings                                5,000

 The company is not operating at full capacity. The sales for the current year is P100,000 and it is expected to increase by P5,000 per year for the next 4 years. The profit margin and the plowback ratio is forecasted to be constant at 5% and 30%, respectively.

 

how much is the increase in retained earnings?

the increase in spontaneous liabilities amounts to? 

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