HEIR JORDAN CORPORATION Balance Sheet Percentage of Sales Percentage of Sales Liabilities and Owners' Equity Current liabilities Assets Current assets Cash $ 2,450 Accounts payable $ 4,000 Accounts receivable 4,000 Notes payable 8,400 Inventory 9,000 Total $ 15,450 Total $ 12,400 Long-term debt Owners' equity $ 21,000 Fixed assets Net plant and equipment $ 37,600 Common stock and paid-in surplus $ 14,000 Retained earnings 5,650 Total 19,650 Total assets $ 53,050 |Total liabilities and owners' equity 53,050
HEIR JORDAN CORPORATION Balance Sheet Percentage of Sales Percentage of Sales Liabilities and Owners' Equity Current liabilities Assets Current assets Cash $ 2,450 Accounts payable $ 4,000 Accounts receivable 4,000 Notes payable 8,400 Inventory 9,000 Total $ 15,450 Total $ 12,400 Long-term debt Owners' equity $ 21,000 Fixed assets Net plant and equipment $ 37,600 Common stock and paid-in surplus $ 14,000 Retained earnings 5,650 Total 19,650 Total assets $ 53,050 |Total liabilities and owners' equity 53,050
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:**Income Statement for Heir Jordan Corporation**
Below is the income statement for the Heir Jordan Corporation, which summarizes the financial performance of the company over a specific period:
**HEIR JORDAN CORPORATION**
**Income Statement**
- **Sales**: $46,200
- **Costs**: $34,200
- **Taxable Income**: $12,000
- **Taxes (25%)**: $3,000
- **Net Income**: $9,000
**Breakdown of Net Income**
- **Dividends**: $3,800
- **Addition to Retained Earnings**: $5,200
This income statement highlights the company's overall revenues and expenditures. The taxable income is calculated by subtracting the costs from sales. Taxes are then computed as 25% of the taxable income, resulting in a net income of $9,000. Out of the net income, dividends amount to $3,800, while the remaining $5,200 is added to retained earnings.
**Application for Balance Sheet Information**
Based on this income statement, we can use the percentage of sales approach to complete the balance sheet for Heir Jordan Corporation. The application of this will consider that accounts payable vary with sales, whereas notes payable do not.
This structured information is crucial for analyses in financial decision-making, investment appraisals, and understanding the company's profitability and financial health.
Transcribed Image Text:**HEIR JORDAN CORPORATION**
**Balance Sheet**
---
### Assets
**Current Assets:**
- **Cash:**
- Value: $2,450
- Percentage of Sales:
- **Accounts Receivable:**
- Value: $4,000
- Percentage of Sales:
- **Inventory:**
- Value: $9,000
- Percentage of Sales:
- **Total Current Assets:**
- Value: $15,450
- Percentage of Sales:
**Fixed Assets:**
- **Net Plant and Equipment:**
- Value: $37,600
- Percentage of Sales:
- **Total Fixed Assets:**
- Value: $37,600
- Percentage of Sales:
**Total Assets:**
- Value: $53,050
- Percentage of Sales:
---
### Liabilities and Owners' Equity
**Current Liabilities:**
- **Accounts Payable:**
- Value: $4,000
- Percentage of Sales:
- **Notes Payable:**
- Value: $8,400
- Percentage of Sales:
- **Total Current Liabilities:**
- Value: $12,400
- Percentage of Sales:
**Long-term Debt:**
- Value: $21,000
- Percentage of Sales:
**Owners' Equity:**
- **Common Stock and Paid-in Surplus:**
- Value: $14,000
- Percentage of Sales:
- **Retained Earnings:**
- Value: $5,650
- Percentage of Sales:
- **Total Equity:**
- Value: $19,650
- Percentage of Sales:
**Total Liabilities and Owners' Equity:**
- Value: $53,050
- Percentage of Sales:
---
**Explanation of Graphs and Diagrams:**
This image provides a tabular representation (balance sheet) of the financial position of Heir Jordan Corporation. There is no graphical representation like charts or diagrams; hence, the balance sheet only contains numerical data and text. The balance sheet is divided into two main sections: 'Assets' and 'Liabilities and Owners' Equity'.
- **Assets Section:** Lists the current and fixed assets along with their monetary values, however, the percentage of sales columns next to each asset are left blank.
- **Liabilities and Owners' Equity
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